General

GENERAL RELEASE

The Pacific Institute of Public Policy is deeply saddened to hear of the devastating news coming out of Samoa today. At this stage it is too early to state what the full impact of the disaster will be, but indications are of a significant human toll and destruction of physical infrastructure.

The earthquake was severe and the extent of damage from the tsunami is just beginning to be known. It is reported from sources on the ground in Apia that parts of the south side of Upolu have been severely affected. Access to these areas remains difficult due to the roads being impassable, but it appears that some villages may have been completely devastated. There have also been reports of extensive damage to hotels and tourist facilities on the south side of the island. A number of tourists are feared to be among the dead. More fatalities are expected as emergency services reach the affected areas.

There are also reports of humans casualties and extensive infrastructure damage in American Samoa including the fish cannery, which is a major source of employment for Samoans.

Mr Derek Brien, Deputy Executive Director of PiPP says “in a small communal society like Samoa it is the human cost that will be felt most immediately and will impact on communities across the Pacific, including New Zealand and Australia. Our thoughts and prayers are with the Samoan community at this difficult time”.

The impact on the nascent tourism industry will be a further blow to a country already suffering from the impact of the global financial crisis. Short term restoration of basic service issues and public health will be a priority. Mr Brien notes “at this stage the focus is very much on saving lives and after that, when more information becomes available, it will be possible to assess the full extent of the damage and look at ways to assist the people and Government of Samoa to recover from this disaster”.

FAST GROWTH IN THE PACIFIC IS POSSIBLE – LOOK AT VANUATU

Analysts have been slow to notice Vanuatu’s economic turn around reflected in an annual average growth rate of 6.6% between 2003 and 2008. Stephen Howes, Professor at the Crawford School of Economics and Government at the Australian National University and co-author of the latest briefing paper from the Pacific Institute of Public Policy (PiPP), says that this growth trend ‘dispels the myth that the Pacific island  economies cannot grow’.

The briefing paper by Dr Howes and Mr Nikunj Soni, PiPP Executive Director, identifies a range of factors that are important for growth in the Pacific – tourism, active land markets, deregulation, and macroeconomic and social stability. Tourism is highlighted as a major driver of growth in Vanuatu with arrivals by air increasing annually by an average of 12.5% between 2003 to 2008 following the deregulation of the airline sector. Cruise ship visitors also doubled in the same period, reaching 106,000 in 2008.

Another main contributor to growth has been the construction sector. Construction growth increased from about 7% in 2004 to 25% in 2008. The construction boom has been driven in part by tourism growth, in part by expatriates and locals building houses, and in part now by the Millennium Challenge Corporation’s large road-building project.

Dr Howes states that Vanuatu’s recent growth has been led by the private sector and not by aid, noting ‘while average annual aid has decreased from its levels in the 1990s, commercial lending has increased across most sectors. This bears testimony to Vanuatu’s growing middle class, as well as the country’s active land market’.

Mr Nikunj Soni points to social stability as a key factor behind Vanuatu’s recent economic success. ‘Despite a fiscal crisis in the late 1990s and a tradition of intense political instability, the underlying social stability in Vanuatu, and and its ability to make transitions of power peacefully have helped lay the foundations for growth, including by enhancing the country’s reputation among potential investors and tourists and by promoting its prospects for inclusion in seasonal workers programmes’, says Mr Soni.

The authors caution that, as a small island economy, Vanuatu inevitably faces high risks. The global recession poses uncertainty about Vanuatu’s short-term prospects. The Government predicts growth of 4.4% for 2009. A downturn in tourism numbers is the major risk, but has not happened yet. In fact in the first four months of this year growth in visitor arrivals has accelerated.

Traditionally, analysts have distinguished between the relatively good performance of the Polynesian countries (Samoa, Tonga, Cook Islands) and the relatively poor performance of the Melanesian countries (Vanuatu, Solomon Islands, Fiji and PNG). That Vanuatu’s recent performance is making the contrast between these two regions less stark is a welcome development.

A copy of the briefing paper is available here.

THE NEED FOR INTERNATIONAL ENGAGEMENT AND A NATIONAL DIALOGUE

The Pacific Institute of Pubic Policy (PiPP) has today released a briefing paper on the Fiji crisis, calling for international engagement and the commencement of a national dialogue to bring an end to military rule.

International condemnation of the self imposed military regime has been loud, most noticeably from Australia and New Zealand. The briefing paper recognises the barrage of criticism is not without some validity, but judges the policy of international isolation as failing the peoples of Fiji and the region. Calling for an immediate return to democracy seems straightforward, and it is simple to condemn outright the sort of dictatorship that Commodore Bainimarama is busy implementing. But PiPP spokesman Derek Brien says “the situation in Fiji is anything but simple or straightforward and misreading the complexity and history divorces the discourse from reality.” The reality is that Bainimarama is there and showing no sign of going away. Non-engagement will only prolong his hold on power.

The PiPP briefing paper explores the evolution of the crisis, unearthing a host of fault lines that have long simmered. Apart from the indigenous Fijian versus Indo-Fijian issue is the east-west rivalry, which sees the more Melanesian west long ruled by Polynesian eastern kingdoms. There is spiritual rivalry between the dominant Methodist Church and other faiths including Catholicism, Hinduism and Islam. On top of this is a lingering class struggle, which has united many ordinary workers of all ethnic backgrounds in a sense that they are being exploited by their own elites. Add to the mix a disparate group of individuals, all for diverse reasons, exploiting the tensions and divisions for their own gain. 

For decades the Australian, New Zealand and US alliance invested their political capital in making Fiji the hub of the Pacific only to have Bainimarama pull the rug from under them in 2006. Fiji has already been suspended from the Pacific Islands Forum and suspension from the Commonwealth is looming. The rhetoric from Canberra and Wellington is especially terse, and yet it seems that if the international response remains negative then nothing, outside inciting rebellion there, is going to change Fiji’s course for the next few years. PiPP suggests that the leaders of the Melanesian Spearhead Group, a sub-regional political alliance, hold the key to brokering Fiji’s return to the community of nations.

PiPP also calls on the military government of Fiji to lift its censorship of the media and restrictions on political activity. Mr Brien says “for Fiji to reconcile the deep-seated hostilities and mistrust that have long plagued the political landscape, there needs to be a rigourous, participatory national dialogue and that should commence without delay”.

A copy of the briefing paper is available here.

Julia Gillard, Australia’s first female Prime Minister, will also chair the Pacific Islands Forum in the lead up to the August meeting of leaders in Port Vila, but does she offer the region fresh hope? Derek Brien, PiPP Executive Director, and Fei Tevi, Secretary General of the Pacific Conference of Churches, join Barbara Heggen and Isabelle Genoux on Radio Australia’s In the Loop programme to discuss what this may mean for the Pacific island countries.

Listen to the discussion here

Julia Gillard, Australia’s first female Prime Minister, will also chair the Pacific Islands Forum in the lead up to the August meeting of leaders in Port Vila, but does she offer the region fresh hope? Derek Brien, PiPP Executive Director, and Fei Tevi, Secretary General of the Pacific Conference of Churches, join Barbara Heggen and Isabelle Genoux on Radio Australia’s In the Loop programme to discuss what this may mean for the Pacific island countries.

Listen to the discussion here

DISCUSSION PAPER #14: Rethinking the aid-centric approach to development.

Download the briefing note here.

PRESS RELEASE

The discourse on foreign aid is still haunted by colonial era issues of guilt, greed, and good intentions. Little wonder that the topic has been steeped in controversy and misunderstanding, which often overshadows the importance that aid can play in improving the lives of many poor people around the world. A recent review of the Australian aid programme in Papua New Guinea has thrown open a raft of new questions.

In the search for answers, the Pacific Institute of Public Policy (PiPP) has released a discussion paper suggesting that it may be time to rethink some of the language and underlying assumptions of the aid-centric approach to development in the Pacific islands.

Derek Brien, Executive Director of PiPP, notes ‘most people equate aid with charity, but the reality is far more complex than that. The aid industry now spans so many disciplines, that it is impossible to determine its overall success or failure without delving further into the humanitarian, political, economic and social dimensions. Some countries, for example, use aid money to  influence solidarity or security; these are rational foreign policy objectives, but it is not aid. Let’s call it for what it is’.

The discussion paper points to the Paris Declaration on Aid Effectiveness and Cairns Compact as examples of efforts to re-think aid, but questions whether these and other pronouncements have really advanced our understanding of what aid is and how it should best be delivered.

The PiPP discussion paper focuses on the Australian aid programme, being the largest in most Melanesian and Polynesian countries. Mr Brien says ‘the 2008 Port Moresby Declaration was a welcome start by the Australian Government in reshaping the aid relationship in the Pacific. The recent Review of the PNG-Australia Treaty on Development Cooperation, a joint initiative of Prime Ministers Somare and Rudd, is another welcome step for embodying a partnership approach as well as for its transparency. Beyond the main messages, this latest review has a number of specific recommendations directed to both governments in relation to the aid program. The Pacific will be watching eagerly to see how these are implemented’.

Mr Brien adds ‘in order to bring aid programmes into line with new political, social and economic realities, it is timely to have a frank Pacific discussion on the topic with the aim of shifting the relationship between donors and recipients to something more befitting a true development partnership’.

The PiPP paper is released as a means of sparking such a discussion.

One suggestion is for Australia to reconsider its migration policy to embrace Pacific islanders as part of the broader Australia community. Another is to use aid to invest in arts and kastom to break the perception that donors only see the islands through the prism of governance and economic issues, something which means nothing for the 80 per cent of islanders living away from towns.

Well-directed aid, development support and foreign policy has the ability to transform lives – and relations between nations – for the better.

Download the briefing note here

Defining a Pacific Agreement on Closer Economic Relations between the island countries, Australia and New Zealand

Informal meetings between Pacific island trade officials and their Australian and New Zealand counterparts have been underway since mid 2008. Behind closed doors, trade officials have sought to define a mutually acceptable structure to commence formal discussions. Australia and New Zealand are evidently frustrated at the pace of proceedings. The Pacific island countries, without the same hang ups about time and potentially more at stake, are adamant there should be a phased approach to entering into negotiations. In the public arena, the debate has forged ahead with many interpreting PACER Plus as a free trade agreement. Others simply argue against any new trading arrangements between the Pacific islands and their bigger regional neighbours.

The pacific Institute of Public Policy (PiPP) has released a briefing paper PACER Plus: the art of negotiation in an attempt to focus discussion to address the fundamental question: What should a Pacific Agreement on Closer Economic Relations between the Pacific island countries, Australia and New Zealand entail?

Mr Derek Brien, Deputy Executive Director of PiPP says “PACER Plus is essentially a blank canvas waiting to be painted jointly by the parties”. He adds “as with any painting, first the artist needs to have an idea of what they want to paint, then sketch it out, often many times, and finally, start applying the paint to canvas. Essentially, Australia and New Zealand want to start painting now. The Pacific island countries are in some cases still formulating ideas, and in others going through the process of sketching out these ideas”.

The Pacific islands have called for a “phased approach” to negotiations, and this is understood to include national consultations and further research to determine national interests. This may come as a surprise to many, including Australian and New Zealand officials, having assumed these tasks would have been completed during the EPA negotiations with Europe.

It is not yet clear what a PACER Plus version of Pacific economic integration will look like, but two issues look set to dominate discussions: first, labour mobility; and second, how much, if at all, governments will be compensated for import tariff revenue losses. Whilst the establishment of new job opportunities under PACER Plus presents an opportunity – albeit a slim one – many island governments worry about the costs of the agreement.

The negotiating capacity of Pacific island governments is so limited that they will probably succumb to the demands of their bigger neighbours on tariffs. This is unlikely to be catastrophic. The islands will maintain market access to Australia and New Zealand, even if this is increasingly worthless owing to preference erosion. Further, any tariff cuts by the island governments are likely to be gradual and may be back-loaded by up to 10 years.

Other than people, the islands have very little to export, meaning that the upside is limited. After more than a decade of trade liberalisation, resulting in broad-ranging goods market access, most regional countries continue to run trade deficits, as they have since independence. Poor infrastructure, unreliable transport, limited access to credit, and growing social inequalities all restrict the development of productive capacity in both goods and services. In this woefully under-developed environment, new foreign competition will do little to generate growth.

Freer trade is not a panacea and PACER Plus needs to be considered as more than just a free trade agreement.

Auckland and Canberra should at the very least formalise access to jobs in their own countries, invest in infrastructure, fund financial institutions, enact measures to combat inequality, and deliver more effective aid programmes in line with the Paris Declaration and Accra Forum.

For their part, Pacific governments need to look beyond the massive imbalances of today and yesteryear to best position their countries in the ever shifting global political and economic landscapes. Nation building requires political foresight to guide the government officials charged with the task of delivering the services and environment to improve the standard of living of the population. Against the backdrop of protecting the national interest, the fundamental challenge for Pacific governments will be how, and over what time frame, to introduce the necessary economic and structural adjustments to maximise future opportunities.

In looking beyond just a free trade agreement, PiPP Board Member Mr Kaliopate Tavola suggests “the challenge for PACER negotiators is really to put meat into this concept with the aim of producing an agreement that is unique, visionary and enterprising that the region can be proud of”.

It will take time, hard work and creative thinking, but through the fine art of negotiation, PACER Plus offers all parties an opportunity to turn a blank canvas into a collective regional masterpiece.

The full briefing note can be downloaded HERE

Pacific Way?

The Pacific Institute of Public Policy calls on the Prime Ministers of Australia and New Zealand to accept the invitation of Commodore Frank Bainimarama to meet to discuss the crisis. “Fiji is in crisis and it is starting to affect the region. From a Pacific perspective, now is the time for big chiefs to sit together and talk”, says Vanuatu’s first President and member of the Pacific Institute of Public Policy Advisory Council, Ati George Sokomanu.

“Fiji is in crisis and it is starting to affect the region. From a Pacific perspective, now is the time for big chiefs to sit together and talk”, says Vanuatu’s first President and member of the Pacific Institute of Public Policy Advisory Council, Ati George Sokomanu. Paramount Chief Vincent Boulekone, former Speaker of Parliament in Vanuatu, suggests “if Kevin Rudd truly wants to develop constructive partnerships in the Pacific, then as a Pacific leader he must be prepared to act like a chief – and that means sitting down with rival chiefs, supping a shell of kava and talking things through”. He may not be able to change Bainimarama’s mind, but he will have a much more personal appreciation of why the Commodore has embarked on his plan and who is supporting him. Wouldn’t he want to get a first hand idea of how, for example, China is increasing its posture in the South Pacific through places like Fiji? Chinese financial support to Fiji has reportedly more than quadrupled in recent years. The latest Defence White Paper reaffirms the need for Australia to focus on its immediate region.

Surely there is an argument for the Australian Prime Minister to at least take the measure of his opponent; like the mafia maxim “keep your friends close and your enemies closer”. President Obama recently met with US foe Hugo Chavez, shook his hand and said that while there were many differences they would try to work things through. Chavez wants to rule for life; Bainimarama says he needs 5 years to set Fiji straight. 

For his part, the Commodore needs to clearly articulate how he intends to introduce one-person one-vote, which is the last vestige of his legitimacy, otherwise his position looks like a naked power grab. “He too must be prepared to assume the role of chief,” says Ati George Sokomanu, adding “if the invitation to Mr Rudd and Mr Keys is a genuine attempt to commence dialogue, then we may yet find a way out of this mess. A Pacific way – or nai tovo vakavanua.” 

Fiji sits on a host of fault lines that have long simmered. Apart from the indigenous versus Indo Fijian issue is the east-west rivalry, which sees the more Melanesian west long, ruled by the (Polynesian) Tonga-influenced eastern “kingdoms”. There is spiritual rivalry between the dominant Methodist Church and other faiths including Catholicism, Hinduism and Islam. On top of this is a lingering class struggle, which has united many ordinary workers of all ethnic backgrounds. 

In terms of democracy, four coups in 20 years suggests that the system is broken and needs a circuit breaker. Examining the nuances of these disputes is essential if Fiji is to finally define a workable and truly democratic system of governance.  Fiji’s Melanesian siblings are also going through processes of shaping political frameworks a generation in from independence. The Melanesian Spearhead Group has a clear role to play in co-ordinating shared interests and engaging leaders as they chart the next phase of nation building.

None of this is to justify the abrogation of the Fiji Constitution or the ham-fisted crackdown on media, political dissidents and the judiciary that the Commodore has embarked on. The media crackdown is particularly odious and calls to mind the paranoia of certain other military regimes. 

There is so far no blood on the streets, but the economy is haemorrhaging. As businesses fail, sanctions are applied and Bainimarama is backed further into a corner, we will likely see a breakdown in civil order. And then what?

The apology to the indigenous peoples of Australia has not gone unnoticed in the region. “By saying sorry on behalf of all Australians, Mr Rudd has demonstrated a commitment to appreciating the importance and diversity of cultures that make up our region. In return we welcome him as a Melanesian brother” says Ati George Sokomanu.

So go Chief Kevin and Chief John! Put on your best floral shirt, be prepared to drink kava and get to know the Commodore so we are better informed about this strategic front-line in our immediate region. Otherwise Frank will just continue doing it His Way.

The Pacific Institute of Public Policy will continue to monitor developments in Fiji.

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Telecommunications Research

The flagship research project for 2008 was a detailed study into how people in urban and rural Vanuatu exploit access to telecommunications, and how the use of telephony impacts on household livelihoods. Undertaken in the backdrop of a newly deregulated market, the study also considered the implications of telecommunications for gender dynamics, small and medium enterprises, and rural-urban linkages. The study draws on recent research conducted by the British Government Department for International Development (DFID), assessing the impact of telecommunications on poverty reduction and rural livelihoods in India, Mozambique and Tanzania. The underlying conceptual framework of the DFID study uses the Sustainable Livelihoods Framework. The research methodology was presented at the regional telecommunications conference held at the University of Samoa, and has received wide acclaim for its approach. A series of media articles accompany the main research findings report, a briefing note and a paper that submitted to the Pacific Economic Bulletin.

Trade policy briefing series

A series of five trade briefing papers have been prepared and disseminated covering the Economic Partnership Agreement (EPA) negotiations, the Melanesian Spearhead Group trade arrangements, the trade pacts in place that affect the Pacific island countries, the special needs of small island states, and PACER Plus agreements and the emerging trade facilitation programs being negotiated to assist the Pacific island countries. The briefing papers have been well received and have led to the institute working closely with the Department of Trade in Vanuatu and being selected as one of six preferred suppliers for the AusAID Pacific Trade Research initiative announced at the Forum Trade Ministers Meeting in July 2008. Each Forum island country has been allocated grant funding to spend on national research priorities at on of the six pre approved regional research institutions.

Research into political parties and groupings of Vanuatu

In partnership with the Australian Labor Party International Projects Unit, PiPP published a concise booklet profiling the political parties contesting the 2008 Vanuatu general election including an overview of each party/grouping policy platform. A first of its kind in Vanuatu, this publication was supported by a series of workshops for young leaders and party officials as well as ongoing engagement with political parties, civil society groups and media organisations.

Human rights training module

In association with the Vanuatu Rural Development Training Centres Association, PiPP published a basic human rights training module that included trainers’ manual and participants’ handbook. The module covers topics such as introduction to human rights, culture and human rights, human rights and development as well as sections on rights of women, children, people living with disabilities and HIV/AIDS.

Road infrastructure in Samoa and Vanuatu

A research project that examines, compares and contrasts the governance and administration practices in Vanuatu and Samoa in relation to land transport. The findings identify the public sector governance and administration arrangements in Samoa and Vanuatu and how they impact on new road infrastructure projects, and contributes to the retention of institutional knowledge of reform processes in both countries.

Drivers of Change

Drivers of Change is a tool used by development agencies to identify and study the linkages between a country’s political framework and the factors that support or block development. It considers the interaction between economic, social and cultural systems and the goals, behaviours and actions of the development actors. PiPP personnel were part of the Drivers of Change team that mapped out possible development scenarios for Vanuatu over the coming 10-15 years, based on different assumptions around political governance. PiPP was later commissioned to distil the key messages of the report into a series of briefing papers to inform a nation wide dissemination program.

Pacific Economic Survey

The Pacific Economic Survey (AusAID 2008) is the first of a series of annual surveys that provide an overview and update of economic developments in the Pacific island region and Timor-Leste. Each Survey also includes separate chapters on particular issues of importance to the region. The 2008 survey examined the challenges of better connecting the Pacific through improved telecommunication, aviation and shipping services. PiPP was engaged to facilitate a number of round table discussions to accompany the launch of the Pacific Economic Survey in both Vanuatu and Solomon Islands and ongoing media engagement on the survey themes.

Network mapping & building

A key activity of the start up period was network building, which included network mapping exercises in Vanuatu, Solomon Islands, Samoa and Marshall Islands to further develop the PiPP network and understanding of the local political context. Additionally, we have forged strong links with a number of local, regional and international institutions (see Appendix 2) and attended/presented at a number of regional seminars in Vanuatu, Solomon Islands, Samoa and Australia.

Media Engagement

PiPP has developed a close collaboration with local and regional media agencies including the Pacific Islands News Association (PINA). In particular we have developed strong ties with the Media Association of Vanuatu and individual media outlets in the preparation and delivery of a series of media forums that were undertaken throughout the 2008 Vanuatu national election campaign. Additionally, we have a working partnership with the media unit at the Vanuatu Institute of Technology, providing mentoring support to media students and places in the internship programme (see below). Through its media engagement, PiPP has been regular contributor to local and regional media and now has a reputation for credible commentary on policy issues in the region.

Internships

An agreement is in place with the Public Service Commission (PSC) of Vanuatu to develop a public service fellowship/internship program that would see PSC approval to grant leave without pay for a period of up to 3 months for approved applicants to join PiPP to undertake a specific piece of research. PiPP will fund applicants (i.e. cover PSC salary) and provide research mentoring support through its Advisory Council. We are currently undertaking an awareness program across the public service and will soon call for applicants. It is envisaged that up to three such placements will be funded through 2009. If successful it is expected that the arrangement be replicated in other Pacific island countries. We also encourage interested individuals to apply to undertake an internship with the institute to carry out a specific piece of research.

Website

The PiPP website (pacificpolicy.org) was re-launched in July, 2008 to include an overview of the organisation and details of activities. The site is being further developed to encourage user interaction (including submission of articles and use of media such as audio and video podcasts) as well as member blogs and links to other relevant information sources.