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SOUTH PACIFIC: Australia Unchallenged by Chequebook Diplomacy

Stephen de Tarczynski

MELBOURNE, Nov 15 2007 (IPS) - Despite the expanded involvement of a number of different powers in the South Pacific – exemplified by the European Union’s recently increased aid commitment – observers say that Australia remains the region’s dominant player.

The 38th Pacific Islands Forum, held in the Tongan capital of Nuku’alofa, on Oct. 16-17, saw the European Union (EU) pledge 392 million US dollars worth of aid to Pacific island nations over the 2008-2013 period, an amount described by the Prime Minister of Papua New Guinea (PNG), Sir Michael Somare, as “a massive increase” from previous years.

But while this “massive increase” in aid represents a greater role in the region for the EU, analysts argue that Australia – which has allocated some 702 million dollars for PNG and other island nations for this financial year alone, according to the country’s foreign minister, Alexander Downer – is still the main player in the South Pacific.

“Australia is still the dominant military, economic (and) political power in the South Pacific, but certainly its policy in the region is complicated by the very active engagement there (of other powers) and also because Pacific Island countries are seeking to diversify their aid, trade and political links,” says Nic Maclellan, a former senior policy advisor on the Pacific for Oxfam International, now working as a freelance journalist and researcher on the region.

China, Japan and Taiwan are also heavily engaged in the Pacific, but “none of these countries yet has anything like the involvement of Australia and New Zealand,” Benjamin Reilly, director of the Centre for Democratic Institutions at the Australian National University, told IPS.

Reilly says that most of Japan’s aid is linked to commercial interests such as fisheries, while Taiwan is using financial incentives to gain diplomatic recognition. Of the 24 nations which maintain formal diplomatic ties with Taiwan, six – Kiribati, Marshall Islands, Nauru, Palau, Solomon Islands, and Tuvalu – are Pacific island states.

China, which competes with Taiwan for recognition via chequebook diplomacy, sees the South Pacific as part of its “neighbourhood,” argues Reilly. Possibly more important for China, however, are the region’s natural resources.

“China’s increasing involvement with Papua New Guinea, which has massive gas and mineral reserves, can be seen in this context,” says Reilly.

The engagement of these powers and other key players in the Pacific – including the United States and multilateral agencies such as the World Bank and the Asian Development Bank – have, according to Maclellan, complicated Australia’s long-term strategic dominance of the region.

“A number of (Pacific island) countries have been willing to diversify their links – trade, aid, military, even – beyond their traditional reliance on Australia, New Zealand, the U.S. and France,” he argues.

In addition, Australia and other donors tend to attach substantial conditions to the aid they provide. The EU’s representative at the Pacific Islands Forum, European Commissioner for Development and Humanitarian Aid, Louis Michel, called for a new approach.

Speaking to Australian television’s Dateline program at the Pacific forum, Michel said: “The new approach is that we have to change the model of development based, to my opinion, from a very archaic, maybe neo-colonialist approach of donor beneficiary to a pure political relationship.”

While Michel argues that donors should “trust” aid recipients to allocate the funds they receive, Nic Maclellan says that the EU is playing hardball regarding trade negotiations.

“In spite of Louis Michel’s fine words, I don’t think we should see the Europeans as acting out of altruism when it comes to this,” Maclellan told IPS, adding that the EU, like others, has strategic interests in the region.

“The EU is running a pretty tough bargain with the Pacific over issues like fisheries, labour mobility and other areas of great concern for the Pacific,” he says.

But the expanding engagement of other players is not the only factor threatening Australia’s position in its “sphere of influence.”

“The other problem with that is that under the Howard Government relations between Australia and key Pacific countries have soured,” says Maclellan.

Australia has testy relations with Solomon Islands’ Prime Minister, Mannaseh Sogavare, who has been critical of the Australian-led Regional Assistance Mission to the Solomon Islands (RAMSI) for “having more to do with Australian interests in the region than that of Solomon Islands itself.”

In addition, Australia has taken a tough stance on Fiji. It applies sanctions to the government led by interim Prime Minister, Commodore Frank Bainimarama, who came to power in a coup last December.

Also, Australian relations with the government of PNG remain shaky over the Julian Moti affair. A PNG Defence Force Inquiry report has implicated Prime Minister Somare in the escape of Moti – an Australian citizen wanted in Australia to face child sex charges, and who is now Solomon Islands’ Attorney-General – from PNG to the Solomon Islands last year. As a result, Somare was snubbed by Australia at September’s APEC forum in Sydney.

Despite the challenges facing Australia’s role in the Pacific, Australia is responding, argues Maclellan. He says that a substantial amount of the increase in Australia’s overseas development assistance programme – both the governing coalition and opposition Labor Party have pledged a significant expansion of aid ahead of the November 24 federal election – will be allocated to the Pacific.

According to Maclellan, this follows a pattern of renewed Australian involvement in the region since 2000, particularly after coups in both Fiji and the Solomons in that year.

“There was a renewed engagement from the Howard Government and that was amplified by concerns in the so-called war on terror,” he told IPS.

Maclellan argues that Australia’s re-engagement in the Pacific has been focused on trade and the “so-called trans-boundary security threats, so-called security threats about gun-running, money laundering, drugs, and indeed, the perceived threat of terrorism from Al Qaeda.”

However, Australia’s focus on these issues has allowed other powers to expand their involvement in the region. “There are other players, particularly China and Taiwan, who are happy to expand their financial support for the Pacific,” says Maclellan.