10:12 AM |
Helping Pacific nations so we can help ourselves
By KARLO MILA - The Dominion Posthttp://www.stuff.co.nz/dominion-post/opinion/3231946/Helping-Pacific-nations-so-we-can-help-ourselves
OPINION: In Hawaii a few days ago, Hillary Clinton said that half of life may not be showing up, but half of diplomacy certainly was.
In terms of United States relations in the region, Australia has long been deputy sheriff and we've been more like the lone ranger. Maybe we were right to get our hopes up when Barack Obama described himself as the first "Pacific President". In an Asia- Pacific context, the Pacific is often referred to as the silent partner. Unfortunately, in Mrs Clinton's Hawaiian speech the word Pacific dropped off the end of the hyphen.
Like it or not, Hillary Clinton is the money. The TransPacific Partnership is a four-way that has our Government heavy breathing in anticipation. Nothing gets a government salivating more than trade agreements. Unless, of course, you are a small Pacific nation with nothing to trade but a lovely bunch of coconuts. Then free trade agreements might make you sweat.
Right now, Pacific Agreement on Closer Economic Relations (PACER- Plus) is the agreement that Australia and New Zealand are pushing in the Pacific. This would see the end of "substantially all" tariffs.
The introduction of PACER-Plus happily coincided with the Pacific Forum's decision not to renew the contract of Roman Grynberg. He was the director of the Economic Governance Programme at the Pacific Islands Forum Secretariat for the last 20 years. It was argued that Dr Grynberg, with his track record of providing expert advice to developing countries on trade negotiation, was no longer "client- centred" enough.
Which makes you wonder exactly who the Pacific Forum's clients are?
With the most experienced trade negotiator out of the way, Australia then offered to build the capacity of Pacific negotiators itself. An Australian-based capacity building programme so that Pacific nations would successfully be empowered to negotiate with Australia. Hmm.
Thanks to existing agreements, the Pacific countries already have relatively open, duty-free access to Australian and New Zealand markets. Yet two-way trade is far from a reality. Last year New Zealand exports to Samoa were close to $100 million. Samoa imports to New Zealand were capped at $6.7m. Exports to Tonga tipped $50m, against imports from Tonga of $3m.
Fiji was worth $363m in exports for New Zealand. (Notably, despite icy diplomatic relations, economic and trade sanctions have never been applied.) Imports from Fiji were worth $71m, making them the big Pacific player. If Fiji signed up to PACER-Plus, they are actually poised to lose something substantial. Professor Wadan Narsey, an economist at the University of the South Pacific, has predicted that under PACER-Plus, up to 80 per cent of Pacific manufacturing could close.
For many other Pacific countries, as Oxfam explains, it is "the lack of viable supply that is the main constraint that an economic co-operation agreement must address". That is the PC way of saying that many Pacific nations have nothing to trade but a lovely bunch of coconuts.
Of course, this is not completely true. The Pacific's greatest exports have been its people. They have been the gift that keeps on giving. Remittances total over $690m a year, more than two and half times the NZAid budget for the Pacific.
Then again, perhaps having very little to trade is a blessing in disguise. Otherwise someone's going to try and Avatar your island. Papua New Guinea, Nauru and Banaba, for example, are endowed with their fair share of "unobtanium": gold, copper, oil, natural gas and other minerals. They've been mined, in more ways than one, up the wazoo.
Last year, New Zealand's trade with the Pacific region was worth over a billion dollars. Foreign Affairs Minister Murray McCully and National MP John Hayes have both said on Pacific aid: "We want to deliver a hand up, not a hand out". Appraise the balance of trade, the aid, the remittances, the markets – you've got to wonder about where, exactly, that hand is up?
PACER-Plus is about ensuring Australia and New Zealand have unprecedented, unlimited, unfettered access to the Pacific pie. As one hand gives, the other reaches for a bigger slice. The hands only ever seem to meet in transit, no doubt in the Koru Lounge.
And of course, the tying of aid to free trade is one way to ensure that there will never be any biting of the hand that feeds.
http://www.stuff.co.nz/dominion-post/opinion/3231946/Helping-Pacific-nations-so-we-can-help-ourselves (please click on the link if you have read this article for Dominion Post's website stats)
Given New Zealand has allowed migration within the free trade deal with China (at their request) and Australia seeks to emulate that deal, it would be churlish for Australia not to allow a similar arrangement with Pacific nations in return for the PACER-plus.
That said, when countries dependent on foreign aid are negotiating directly with their aid donors on unrelated matters like free trade arrangements, there is the question of undue influence and the principle that any contract signed under duress is legally suspect.
Is PACER-plus truly in the best interests of all involved, and if not what can be done to mitigate the inherent lack of equal outcomes for all parties.
The altruistic option is to allow unlimited tariff free movement of goods into Australia and New Zealand, but allow each of the Pacific nations to determine if they want to protect domestic industries from imports – only requiring that terms for our exports be no more onerous than for any other Pacific country (a Pacific standard preferential to that for the rest of the world).
The export potential of the Pacific's people seems great, as you have acknowledged. In exchange for lowering tariffs on substantially all their trade with Australia and New Zealand, the Pacific countries should be arguing for expanded temporary work opportunities - like our RSE scheme. Australia has large proportions of their fruit crops that go to waste because there are not enough people to harvest them and given that the RSE scheme has worked well here, it should also be applicable to Australia (but in a bigger way obviously). This could significantly enlarge the remittance pie for Pacific people. This may reduce that trade imbalance.
0 comments:
Post a Comment