Pacific Scoop

Canberra’s veto of Fiji aid evidence of ‘crash tackling’ regime

Professor Stephen Howes

Professor Stephen Howes – accuses Australian government of “using its muscle” to veto loans to Fiji by both the World Bank and the Asian Development Bank. Image: Crawford/ANU

Pacific Scoop:
Commentary – By Graham Davis in Suva

Relations between Fiji and Australia have taken yet another turn for the worse with the revelation that Canberra has been secretly blocking Fiji’s access to hundreds of millions of dollars for development projects.

A senior Australian academic – Professor Stephen Howes – told The Australian newspaper that the government had used its muscle to veto loans to Fiji by both the World Bank and the Asian Development Bank.

They would have been used to finance improved basic services for ordinary Fijians such as water, roads, hospitals and schools. Instead, Fiji was forced to turn to China to secure low interest loans and was also obliged under these contracts to use Chinese firms and Chinese workers.

Professor Howes is director of the Development Policy Centre at the Australian National University so his sources are presumably credible. And while an official Australian government spokesperson responded that the two banks are independent institutions with their own decision-making processes, there was no outright Australian denial of the professor’s claim.

All of which constitutes more evidence that in spite of Fiji’s clear timetable for a return to democratic rule by next September, Australia is intent on crash tackling the Bainimarama government at every turn.

The hostility is even more remarkable when the relationship between ordinary Fijians and ordinary Australians remains warm, even affectionate, and the business communities of both countries maintain their cordial, mutually profitable ties.

Australia keeps saying that it’s not targeting ordinary Fijians, just the Bainimarama government, and has increased its Fijian aid program to more than $F100 million for the first time.

Purse strings
But Canberra controls the purse strings and chooses the projects in a way that Fiji naturally finds highhanded, even offensive.

“Not surprising” was the reaction to the disclosure of the loan veto by Fiji’s Acting Prime Minister and Attorney-General, Aiyaz Sayed-Khaiyum, who added that Australian policy reflected its unwillingness to understand what was happening in Fiji.

“Representatives of a number of developed democracies have confided to us that they consider the Australian posture unwarranted, counterproductive and not supported by the facts in Fiji,” he said.

Those countries include the United States, some of whose diplomats, both in Washington and Suva, are confiding privately to the Fijians and others that they are perplexed by Australia’s continuing hardline stance.

The Americans are clearly torn between their desire not to unduly offend their Australian ally in ANZUS and their increasing concern that Canberra’s intransigence is driving Fiji steadily closer to the Chinese.

That concern can only have been exacerbated this week by the sight of the Prime Minister, Voreqe Bainimarama, hobnobbing with the new Chinese leadership in Beijing and becoming the first Pacific leader ever to be granted access to the very top.

All along, Commodore Bainimarama has confounded the Australian attempts to dislodge him. And the more the Aussies bait him – it seems – the more he rubs their noses in the dirt.

Dangerous face-off
In a strategic sense, the Pacific has emerged as the setting for what some analysts fear could become a dangerous face-off between the Chinese and the Americans down the track.

China is already flexing its muscles and trying to impose its will on some of its neighbours such as Japan with a string of territorial demands. And while some commentators – who can be loosely termed the “doves” – insist that Beijing is only interested in promoting its commercial interests and wants to work in partnership with countries like the US and Australia to guarantee regional stability, others – the “hawks” – aren’t so sure.

Just this week came yet another example of Beijing’s less-than-friendly attitude when it was revealed that China had hacked into, and compromised, Australia’s new intelligence headquarters in Canberra. That story has not been officially denied.

The “hawks” are especially concerned about the way in which Australia’s Labor government has steadily degraded the country’s defence capability. One of them – The Australian’s foreign editor, Greg Sheridan – has described the defence wind-down as a “national disgrace”.

He said that while Australia could still readily cope with an emergency in one of its island neighbours, it was now so denuded of appropriate weaponry that it was no longer able to contest a wider conflict.

The United States, of course, is certain to find this perplexing on two fronts – a close ally which it saved from a Japanese invasion in World War Two disconcertingly sanguine about its own defences and an emerging superpower in the form of China increasingly active in Australia’s backyard.

As Chinese missile and satellite tracking ships become a regular fixture in Suva Harbour and the overall Chinese presence becomes ever more visible in Fiji, some Americans are asking a pointed question. What on earth happened to the “deputy sheriff” badge that was given to John Howard by George W. Bush to keep the South Pacific pacific and inside the Western orbit?

Chinese sail-in
Answer: The deputy sheriff’s successors turned their backs on the region’s most influential country, Fiji, in support of an unenforceable principle and allowed the Chinese to sail right on in.

The Australians themselves, of course, are in a terrible bind. Their economic success and pampered lifestyle has just earned Australia the tag of “happiest Western democracy”.

Yet that happiness depends entirely on China continuing to buy Australia’s natural resources. Simply put, the Chinese have the Aussies by the vitals with a narrative that goes something like this: “While we prop up your economy, you will not only keep selling us your minerals and gas but will refrain from rattling your sabres in our direction.”

Not that there seems much to rattle, if Australia’s more pessimistic defence analysts are to be believed. So China is free to make inroads in the region and that includes establishing a strategic beachhead in Fiji.

By shunning the Bainimarama government and cutting off its access to alternative sources of funding, Canberra abandoned its influence in Fiji long ago and smoothed Beijing’s way. How could the Australians have made such a major strategic blunder?

The simple answer is that since Labor came to power in 2007, the country’s trade unions have largely dictated Australian policy towards Fiji.

Acting in the interests of a handful of local union leaders, the Australian unions that installed Prime Minister Julia Gillard after removing her predecessor, Kevin Rudd, in 2010, have insisted on Canberra maintaining a hardline stance.

Union narrative
They have bought the local union narrative of “repressive regime tramping on workers’ rights” lock, stock and barrel. That’s why they’re still trying to deter international visitors from coming to Fiji irrespective of the potential impact on the jobs of ordinary Fijians or the evidence that Fiji’s labour reforms were essential to save crucial state-owned industries like Air Pacific, the national airline.

Yet with every week, that uncompromising stance – the so-called smart sanctions and the entire panoply of punitive measures – becomes more and more untenable.

Yes, there have been a few hiccups along the way to restoring parliamentary democracy – the junking of the Ghai Draft Constitution among them. But by any rational measure, the election countdown in Fiji is well underway.

Even if one doubts the assurances by the Prime Minister of a free and fair “battle of ideas” to determine Fiji’s future, there’s still plenty of concrete evidence to support the notion that an election will be held as promised. Among them:

• Four political parties formally registered thus far to contest the polls – including all the pre-2006 political entities.

• More than half–a-million Fijians electronically registered to vote, with a new registration phase beginning next week. And…

• The acceptance of offers of international assistance to conduct the poll, including a highly-prized $F30-million donation “without strings” from Papua New Guinea.

Lingering suspicion
Last week the Australians, the New Zealanders and the Europeans filed into Aiyaz Sayed-Khaiyum’s office to discuss what they might bring to the table. Yet in the case of the Australians, there’s plenty of lingering suspicion about a nation dangling the promise of assistance while doing all it can to derail the Bainimarama government even at this late stage of the countdown.

The disclosure of Australia white-anting Fiji’s ability to raise loans is just the latest in a long line of crash tackles that might have been irritants and even glancing blows yet failed to derail the Bainimarama juggernaut.

For a start, how can anyone describe the so-called smart sanctions as anything but dumb when they’ve been so patently capricious and petty, as in the case of the Australian travel bans.

Take what happened when Dave Pflieger – the recently departed head of Air Pacific – took one of his planes to Brisbane to visit the airline’s biggest market. This American citizen found himself on the Australian watch list and was turned away and forced to return to Nadi.

Why? Not because he was the head of Air Pacific but because he’d taken the job of Chairman of Tourism Fiji, a Government statutory authority. Air Pacific happens to be 49 per cent owned by Qantas, the “Flying Kangaroo”.

Surely – one is entitled to ask – Pflieger was an American working on behalf of an airline almost half-owned by Australia? Didn’t he have a right to visit Australia to pursue the interests of Air Pacific’s Australian shareholders?

Yes, but that didn’t matter. The Australian action penalised an American citizen, not a Fijian, and contravened every conceivable principle of the right to free trade. In the event, Pflieger turned Air Pacific around, returned it to profit, bought new airplanes and the airline will fly even higher next month as the reborn and rebranded Fiji Airways.

UN peacekeeping
But no thanks to Australia.

Then there’s Canberra’s repeated attempts to get Fijian troops removed from UN peacekeeping duties. Time and again, Australian diplomats and most notably the former Prime Minister Kevin Rudd, tried to get Fijian soldiers sent home.

Blind Freddy – and certainly the UN hierarchy – could see that the attempt was utterly counterproductive. The RFMF has repeatedly proven its metal by keeping order in a string of potential humanitarian disasters, from the Gaza Strip and the Sinai to Lebanon and Iraq.

They have been popular on the ground for being the opposite of trigger-happy. Indeed it’s become well known among the citizens of these blighted places that the time to really fear a Fijian soldier is when he puts his weapon down.

It’s a sure sign, as he strides purposefully towards you, that a cuffing is in the offing and this has come to be regarded as more fearsome than any bullet.

So Fijian peacekeepers are supported by almost everyone. Except, of course, the Aussies and their trans-Tasman clients, the Kiwis.

The real point about this attempt to damage Fiji isn’t that it happened but that it failed. Once again, Australia’s impotence has been laid bare. Because not only are Fiji’s existing UN commitments continuing, there’s every sign that they could well be expanded.

Packed bags
How will Australia react publicly? Who cares. Certainly no-one in the Fijian government, where even the mention of Australia nowadays is sometimes enough to trigger a sharp expletive and a rapid change of subject.

Which is why Fiji is in no hurry to accept a new Australian High Commissioner in Fiji, no matter how pleasant she might be personally in the case of Margaret Twomey, who presently has her bags packed in Canberra and is sitting there with nowhere to go.

A couple of weeks back, Australia’s Foreign Minister, Bob Carr, said Fiji was “diminished” by not accepting Twomey in Suva. Fiji responded by describing Australia as prescriptive and highhanded.

Yet the irony is that diminished is the very word to describe Australia’s status not only in Fijian eyes but in the eyes of many of its neighbours as its punitive stance continues into a seventh year. The legacy of that policy includes :

• The abject failure of a sanctions policy that Canberra and Commodore Bainimarama’s opponents were convinced would eventually bring him to his knees.

• The abject failure to isolate him internationally. On the contrary, the PM is the current chair of the Melanesian Spearhead Group, chair of the G77 Plus China – the biggest voting bloc at the UN – and chair of the International Sugar Organisation. Under it’s “Look North Policy”, Fiji has also joined the Non Aligned Movement and established diplomatic links for the first time with almost 50 countries. And it’s chaired the United Nations General Assembly. Some isolation.

• Severe, possibly irreparable, damage to the Pacific Islands Forum, once the preeminent regional organisation but now largely reduced to an Australian, NZ and largely Polynesian club as the Melanesians express their preference for their own organisation – the Melanesian Spearhead Group. Suspending Fiji – the most influential island nation – has been a disaster for the Forum. Not only may Fiji never return, the Pacific island states no longer speak with one voice. Polynesia and Melanesia have been split.

• Fiji and Papua New Guinea are leading moves to strengthen the MSG, make it the pre-eminent regional grouping and turn its member countries into a common market, with free trade in goods, services and labour. Papua New Guinea is cool on the Pacer Plus trade arrangements with Australia and NZ, saying it would prefer to pursue the MSG option. This too is a stunning break with the past.

• Fiji’s militant stance against Australian hegemony is beginning to spread to the rest of the MSG, with Papua New Guinea now publically castigating Australia for being high-handed and praising Fiji for its foresight and leadership.

Diminished standing
So, Senator Carr, who precisely is diminished here? To add insult to injury, the Australian government looks set to be destroyed in just under four months time at the hands of its own voters.

Public support for the Labor Party hovers at around 30 percent and even many Labor MPs have written it off as a lost cause.

So here’s a delicious irony. Voreqe Bainimarama will still be around long after Julia Gillard and Bob Carr are truly diminished – consigned to the history books as perhaps the worst Australian government since the disastrous “Whitlam Experiment” of the early 1970s.

The other day, the Australian unions had the temerity to demand that Fiji be given until September to prove that its elections next year would be free and fair.

Why September? Because on September 14, they too will be history as their ability to influence Australian policy towards Fiji is crushed by Tony Abbott’s juggernaut.

The real import of The Australian’s story on the loan veto – conveniently ignored, incidentally, by the Eeyores at the Fiji Times – were some comments from Abbott’s likely Foreign Minister, Julie Bishop. She said that if elected, the Coalition would “review the sanctions against Fiji that remain place to ensure they are meeting their declared goals”.

They aren’t so presumably they’ll be modified. And then the sweetest sentence of all.

“We would seek to re-engage with Fiji and to help it return to democracy and normalise relations as soon as possible”.

Bye-bye Julia and Bob, hello Tony and Julie. For Fiji, the change of government in Australia can’t come soon enough.

Graham Davis, a dual Fiji-Australian journalist works in both countries. He hosts the political affairs programme The Great Divide on Southern Cross Austereo television, publishes the blog Grubsheet, is a regional adviser to Qorvis – the global US communications giant contracted to the military-backed Fiji government – and writes opinion for Fiji’s biggest selling newspaper, the Fiji Sun.

1 comment:

  1. Scott MacWilliam, 15. June 2013, 16:54

    Graham Davis and I agree on the errors and incompetence of ANZ policy toward the Bainimarama regime. However we strongly disagree on the reasons for the foreign policy stance adopted by Australia. Graham seriously over-estimates the influence of the Australian trade unions, and is too sanguine regarding the opposition LNP Coalition’s sweet talk about supposed `re-engagement’. He is also too welcoming of any change of government here, which is likely to lead to major and quite deep cuts in Australia’s foreign aid budget. South Pacific leaders should prepare instead for the possibility of a change in government which will be no more sensitive in its handling of relations with regional countries. Indonesia has already flagged as strongly as possible that it will not accept the principal plank of Coalition policy toward asylum seekers, dubbed `sending back the boats’. Bishop only just over-turned a major drive within her own ranks to propose major cuts to foreign aid,. There remains far more weight behind that position in conservative Coalition ranks than in the parties which make up the current governing coalition.
    If trade unions play a minor part in determining Australian policy toward Fiji, then from where does the `sanctions policy’ imposed on December 6, 2006 derive? Look instead to the DFAT old guard, the then LNP John Howard-led coalition government and in particular the Foreign Minister Alexander Downer. Recall that Australia imposed sanctions against the military regime immediately after the 2006 takeover and long before the Bainimarama regime began attacks on Fiji’s trade unions and unionised workers. DFAT and Downer were strong supporters of the Qarase regime, even in its most reprehensible actions. Expect funding and other forms of support from conservative circles in Australia toward whatever the remnants of the SVT-SDL manage to cobble together as a party running candidates in the 2014 election. Mahendra Chaudhry’s FLP is not the only party which will receive funds from overseas in the run up to the election in Fiji.The opposition to this military regime in Fiji is almost as deep in LNP ranks as it is among the ALP, trade unions and other left-of-centre political parties in Australia.
    The ALP-Green-Independents government’s errors have been to maintain what they were handed in 2007. When this government came to power it had a domineering PM who presided over all areas but especially foreign policy constantly. Rudd then became Foreign Minister and continued his preoccupation with big-power events, conferences etc. For Rudd the South Pacific was largely irrelevant while he pranced on the global stage. Julia Gillard’s government has done little more than follow Rudd’s priorities, even if AusAID has increased it funding for Fiji.
    This constancy between LNP and the subsequent governments far better explains the bi-partisan stance toward Fiji’s military regime than any excessive trade union influence. It might also suggest that Graham Davis and others hoping for a major change in government here and thus Australia’s foreign policy stance toward the Bainimarama regime shouldn’t count their chickens just yet.