Tensions between Fiji and the two South West Pacific regional powers, Australia and New Zealand, intensified further this week after Suva expelled two top diplomats for interfering in the country’s internal affairs.

 

Fiji’s Prime Minister Commodore Frank Bainimarama, who came to power through a military coup in December 2006, announced the expulsion of Australia’s High Commissioner James Bartley and New Zealand’s Deputy High Commissioner Todd Cleaver on 3 November. Canberra and Wellington retaliated by ordering Fiji’s top diplomat in each country to leave.

 

The immediate reason given for Fiji’s decision was an attempt by the Australian government to prevent the recruitment of Sri Lankan judges and magistrates to the Fijian judiciary. Fijian Chief Justice Anthony Gates claimed last weekend that Australian consular officials in Colombo had contacted Sri Lankan judges to advise them against taking up the positions and warning that they would be banned from landing in Australia. Gates, an Australian citizen, alleged that they had been forced to fly via Korea due to Australian travel bans. The Australian and New Zealand governments imposed the travel bans and other punitive measures on Fiji after the 2006 coup.

 

Announcing the expulsions, Bainimarama declared: “I cannot understand why Australia and New Zealand are engaged in dishonest and untruthful strategies to undermine our judiciary, our independent institutions and our economy. I can accept their ban on me and my senior officers, given the personalisation of matters. But why punish individuals both Fijians and non-Fijians who join the judiciary?”

 

The junta further consolidated its hold on power on Thursday by swearing in Ratu Epeli Nailatikau, a former military commander, as Fiji’s president. Chief Justice Gates officiated at the ceremony. Later in the day, President Nailatikau presided as the five Sri Lankan judges and magistrates were sworn into office.

 

The military junta rests on sections of the Fijian chiefly elite more open to foreign investment and Indo-Fijian business layers who were marginalised by ousted Prime Minister Laisenia Qarase’s discriminatory policies in favour of ethnic Fijians.

 

Australian Prime Minister Kevin Rudd condemned the diplomatic expulsions, saying: “We’re not about to simply allow a coup culture to spread. That’s why we’ll maintain a hardline in relation to this regime.” Australia and New Zealand have been demanding that Bainimarama hold fresh elections, which the junta has delayed until 2014, and pressed hard for the suspension of Fiji from the Pacific Islands Forum (PIF) in May. The governments extended the travel bans on Fiji to judges in April.

 

In August, Australia took over the PIF’s rotating leadership for the first time in bid to tighten its grip over the small island nations of the South West Pacific. Fiji was excluded from the meeting even though a regional free trade agreement known as PACER Plus was under discussion. In October, Suva suspended its involvement in PACER after its pleas for inclusion in further discussions failed. The main purpose of the proposed agreement is to further open the region to Australian and New Zealand companies.

 

Australia has been lobbying the United Nations to end the use of Fijian troops in peace-keeping missions. The move would be a significant further blow to the Fijian economy as remittances from Fijian soldiers deployed by the UN provide a major source of income. So far the UN has rejected the Australian proposal.

 

The Rudd government’s tough stance has been backed by the Obama administration. US State Department spokesman Ian Kelly warned on Thursday that Fiji’s diplomatic expulsions “had undermined any opportunity for progress toward re-engagement and constructive dialogue with its neighbours”. He reiterated US support for the demand by Australia and New Zealand for fresh elections.

 

The posturing of the Australian and New Zealand governments as defenders of Fijian democracy is completely cynical. Their increasingly heavy-handed bullying, including military interventions in East Timor and the Solomon Islands, is driven by concerns that regional rivals, particularly China, are gaining influence in an area that the two countries have long regarded as their sphere of influence.

 

In turn, the ability of the Fijian junta to resist pressure from Canberra and Wellington is dependent on closer relations with China, which has provided significant economic aid. According to the Australian-based Lowy Institute, Chinese aid to Fiji increased from $A1.6 million in 2005 to about $36 million in 2006. In the year after the coup, it rose to more than $251 million. Beijing now provides more financial assistance to Fiji than to any other Pacific nation.

 

The Xinhua newsagency reported this week that China had donated a further $US850,000 to the PIF Secretariat based in Suva. Another indication of closer ties is the commencement of regular flights between Hong Kong and Fiji to cater for increasing Chinese tourism.

 

An editorial in the Australian on Thursday warned Canberra of the dangers of its aggressive policy toward Suva, pointedly referring to China. “Fiji is the hub of the Pacific, the nation that must not fail, and there are dangers in isolating it further. The stakes are high, given the potentially contagious effect of its errant behaviour on other fragile Pacific nations… The Pacific is increasingly contested terrain as China pours in aid money (about $254 million last year) in ‘soft power’ diplomacy that could undermine Australia’s influence,” it stated.

 

In many respects, the Bainimarama regime has carried out policies previously demanded by Canberra and Wellington—ending the communal programs of the former Qarase government, favouring foreign investment and slashing public sector spending through job cuts and a pay freeze. Noting that “Australia does not have a lot of fresh options to influence events in Fiji,” the Australian editorial suggested a more accommodative approach—“open dialogue” while refusing, at this stage at least, to legitimise the 2006 coup.

 

Behind the Australian editorial are fears in Australian business circles that continued tensions are adversely affecting their dealings in the Pacific. Fiji is the major administrative centre in the Pacific, including for larger business. Suva is the Pacific headquarters of major Australian banks—ANZ, Westpac and Colonial National, a subsidiary of the Commonwealth Bank.

 

Following the diplomatic expulsions, Australia-Fiji Business Council President Brian Anderson told the Australian Broadcasting Corporation: “Fiji is struggling for more investment as it is, and this sort of thing only creates more uncertainty. Business cannot operate in a climate of uncertainty.”

 

According to the Melbourne Herald Sun, the Commonwealth Bank is selling the Colonial National Bank due to a regulatory crackdown in April. The Reserve Bank of Fiji devalued the currency by 20 percent, suspended certain banking transactions and limited others. The ANZ and Westpac face a decline in profits in Fiji this year after the imposition of interest rate margin limits on lending and measures forcing them to provide finance to disadvantaged communities.

 

There is no sign, however, that the Australian and New Zealand governments intend to adopt a softer approach.