CHINA: New era of investment in the Pacific
31/10/2003 16:14:14 | Asia Pacific Programs
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Burma's flourishing business profile in the region, follows hot on the heels of China, which continues to make significant economic inroads in the South Pacific. In the past five years, Beijing's popularity with Pacific island nations has moved from strength to strength, mainly because of a steady supply of cash for aid projects.
Dr Ben Reilly, policy analyst, the Australian National University's Centre for Development studies; Roger Baker, from the US Based civilian intelligence organisation - STRATFOR; Robert Woonton, Cook Islands Prime Minister; Fred Sevele, Tongan Human Rights and Democracy MP
Transcript:
WOODS: Many Pacific nations have found a new friend in China - many of them ditching an "old" friend in Taiwan ... many seeing Chinese aid as more attractive to that from its traditional donor countries - Australia and New Zealand ...
From Tonga to Tuvalu and Cook Islands to Kiribati - China is making its mark in the Pacific - spending tens of millions of dollars on aid projects in island nations ...
From a 24-million dollar Sports and Aquatic centre in the Fijian capital, Suva to a new court house in the Cook Islands ...to the training of Tongan military officers and construction of two new high schools in Nuku'alofa... China has invested in the region in the past five years ...like never before ...
But what does it hope to gain ? - and why such an obvious increased presence?
Roger Baker from the US Based civilian intelligence organisation - STRATFOR :
BAKER: China is making an extensive effort in the Pacific, in South East Asia and even in other places in the world to demonstrate that they are not a threat, they're not a new challenge but they're a new partner in the region and in the world, and in such a way helping to build up their credibility and also build up their economic and political ties.
WOODS: In 2003 only five Pacific nations now maintain diplomatic ties with Taiwan. Others have walked the now well-worn route to Beijing - and many analysts say that in 5 to 10 years, many Pacific island nations will owe their primary allegiance to China. One of them is Ben Reilly - a political analyst at the Australian National University's Centre for Development studies :
REILLY: For the last five or six years now the very first overseas visit that a newly elected prime minister from any of these countries does is always to Beijing, that's the first place they go to, and that's become standard practice now. So they don't go to Canberra, they don't go to Wellington, they certainly don't go to Washington DC, they're going to Beijing. I think it's a good indicator of the importance attached to China in the region these days. So I think it's already happening.
WOODS: So what price do these Pacific nations have to pay for the assistance they are getting from Beijing? - very little in the short term according to STRATFOR'S Roger Baker.
BAKER: The intial tradeoff is they can't recognise Taiwan, they were only recognising Taiwan for the money too. In the end China may look here and there for some places to put listening posts, to put naval assets at times, they use the Pacific for tracking stations, for their space program, they're a little things of that sort. But at the moment the tradeoff is very little for these countries, and these countries are really in need of some economic and financial assistance.
WOODS: Many Pacific nations are walking away from aid from Australia and New Zealand because Chinese aid seemingly comes with no strings attached. Many Pacific leaders have openly admit that they are tired of the lectures that come with aid from Canberra and Wellington. The ANU's Ben Reilly :
REILLY: Particularly on issues like good governance, democracy, the kinds of issues that the western donors tends to be very demanding on, you don't get that kind of rhetoric from China. And in fact if you listen to Michael Somare or the Fijian Prime Minister, they've both said recently explicitly that one of the things they most appreciate about aid from Asian countries in general and from China in particular is that it doesn't come with these extra good governance strings attached.
WOODS: However, some in the Pacific are concerned with aligning themselves too closely to Beijing. Tongan Human Rights and Democracy MP, Fred Sevele, says his government has been dazzled by the seemingly bottomless pot of money being offered by China, without thinking about the long term implications :
SEVELE: They're always strings attached, one feels obligated to that and often it's not visible but the strings, the obligations that go with our receiving such aid are there, and often those intangible strings are the ones that turn out not to be in the best interests of the recipient countries.
WOODS: Fred Sevele says he would like to see Tonga re-establish strong ties with its traditional donors.
SEVELE: I would have been much happier had we stayed with our traditional donor countries, and that's Australia, New Zealand. We have been friends with for around a century, and I'd rather that we have stayed with them rather than getting involved with China. It's a big place China, it's a big country and it scares me.
WOODS: The Cook Islands has also accepted millions of dollars in aid from Beijing for the construction of a new court house and is considering usiing additional funds to build either a new parliament building or police headquarters. Cook Islands Prime Minister Dr Robert Woonton unashamedly admits that in return Cook Islands has promised to support China at international forums :
WOONTON: They just want us to support their stand in a number of regional issues or international issues, on security, on environment issues and no different from any other aid country that helps the Cook Islands.
WOODS: Doctor Ben Reilly says historically - and today - competition between China and Taiwan for UN votes and diplomatic recognition has driven much of their engagement with the South Pacific.
REILLY: As well as that story there's been a new story which is of China seeking to gain a little bit of strategic influence in the region, maybe gain a little bit of economic influence. But really making an investment for the long term China sees itself as a rising Pacific power and it sees the western Pacific as its kind of sphere of influence. So it's not surprising I think that given all the other things that are happening in China, given the incredible economic growth we're seeing, given the increasing military power, that they would also look to engage some of these small island states, not just for UN votes but for longer term strategic interests.
WOODS: STRATFORS Roger Baker agrees and says China's presence in the Pacific is set to grow dramatically :
BAKER: China's going to continue to be pushing itself into the region saying look, we're here, we're big, you can work with us instead of having to worry about being afraid of us militarily or being afraid of us economically, and when we all work together we actually have an opportunity to be able to at least present a block that can stand up to unilateral positions of the United States.
WOODS: However, many analysts says the extent of China's influence in the Pacific, will depend on how much China wants to compete with Australia - particularly in light of Australia's more pro-active role in the Pacific.
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