Seeks Security With Pacific Union
August 17, 2003
MARK CHIPPERFIELD IN SYDNEY
AN AUDACIOUS plan to fashion a European Union-style trading bloc in the
Pacific is being pursued by Australia in a bid to shore up the failing
economies of islands in the region.
Under the proposals, which are being discussed by South Pacific leaders
at a meeting in Auckland, 16 nations would adopt a single currency and
co-ordinate policing, transport, education, health and economic
Australia and New Zealand, the region’s two most prosperous nations,
would be expected to play a leading role in establishing the new
organisation and funding its operation.
The new union would unite them with populous, resource-rich countries
such as Papua New Guinea and micro-states like Tuvalu, Niue and the
Australia, in particular, fears that an ‘arc of instability’ of near
bankrupt states stretching from Papua New Guinea to Western Samoa could
have damaging knock-on effects on its economy and also prove a fertile
breeding ground for terrorists.
The idea of a pan-Pacific trading block is contained in a foreign
affairs report prepared by an Australian parliamentary committee, which
has been largely endorsed by Australian Prime Minister John Howard.
Among the committee’s recommendations are the creation of a common
labour market and the adoption of a common currency "based on the
"Many of the countries suffer the problems that arise in small nations
with micro-economies," the report says.
"To obtain sustainable economic growth, reform needs to be pursued
across the region."
Howard has been treading carefully around the issue but his stance has
still incensed some Pacific leaders, who fear the creation of a trading
bloc controlled by Australia and believe the plan smacks of
"It would be a very sad day if Australia tried to bully the island
nations," said Noel Levi, departing secretary of the Pacific Islands
"We hope to look at all these initiatives and try to extract from them
what is best for the Pacific."
Even New Zealand, which is supporting Australia in its current
peacekeeping mission in the Solomon Islands and shares its concern about
regional security, is reluctant to endorse an European Union-style
trading bloc in the Pacific.
Although the New Zealand business community and a growing number of
government advisers support monetary union with Australia, prime
minister Helen Clark believes dropping the NZ dollar would be political
Howard’s stated aim of creating a union of the eight smallest Pacific
nations - Kiribati, Nauru, Niue, Palau, the Marshall Islands, Tonga,
Tuvalu and the Federated States of Micronesia - is seen as a first step
towards the larger bloc.
However, even this is proving hugely controversial with many reluctant
to cede power to a centralised Pacific body.
Speaking ahead of the Pacific Islands Forum, Howard said it was clear
that independence had not delivered any benefits to the people of these
tiny Pacific nations, quite the reverse.
"With the greatest goodwill in the world, many of these countries are
too small to be viable in the normal understanding of that expression,"
he said. "We really have to develop an approach that I could loosely
call ‘pooled regional governance’."
Other regional bodies look set to appear, with Australia saying it will
pay for a new police academy on Fiji that would train recruits from
across the region, apart from New Zealand and Australia.
The Pacific already has a regional university (the University of the
South Pacific in Suva) and several countries already use the Australian
dollar or New Zealand dollar.
How other supra-national organisations will be funded has not been
disclosed, although Australia’s new-found interest in Pacific affairs
has been spurred on by intelligence warnings that bankrupt or "failed"
island nations could be used by terrorists from South-east Asia or the
This is a sensitive issue for the Australian government as 88 of its
citizens were killed in last October’s bombing in Bali.
International agencies have already clamped down on a raft of illegal
activities in the region, including money-laundering, drug-running, arms
smuggling and the sale of passports.
In May this year, Tonga was forced to close its international shipping
registry after a vessel flying its flag was intercepted carrying
terrorist munitions off the coast of Israel.
When an Australian-led peacekeeping force was dispatched to the war-torn
Solomon Islands last month, the only criticism from opposition
politicians was that Canberra should have acted sooner.
Outside Australia, political leaders are nervous and view the
peacekeepers’ deployment as a worrying precedent.
Vinci Clodumar, a former finance minister from Nauru, said it was feared
Australia would take advantage of its financial clout on the forum,
rather than working as part of a general consensus. "They are now taking
a tougher position," he said. "I hope they are not trying to upset the
Pacific way of doing things."
Only the prime minister of Fiji, Laisenia Qarase, has publicly endorsed
the Australian proposal for closer economic co-operation; although his
comments were fairly muted.
While Howard claims that Australia is merely trying to be a good
neighbour - and guarantee that its aid budget $A500m (£207m) is being
well spent - others question Canberra’s long-term aims.
Steven Ratuva, a visiting fellow at the Australian National University,
believes that the creation of a regional authority would result in many
island issues being overlooked.
"In the Pacific, a lot of the national problems are best solved
internally," he said. "The over-reliance on regional solutions would
undermine local potential for creativity and innovation in favour of the
security and governance interests of others."
Judging by the reaction so far, it seems unlikely that delegates
attending this weekend’s Pacific Islands Forum will adopt any of the new
For the past 32 years, the post of secretary-general of the Pacific
Islands Forum has been held by a Pacific islander. But Howard’s attempt
to install an Australian diplomat, Greg Unwin, made clear that he is
keen to see his country take more of a lead in the area.