| FEMM: THUMBS UP FOR TONGA AT PALAU FORUM MEET |
FEMM wants to shed ‘no action’ image
Samisoni Pareti
Tonga got a big endorsement for its austere public sector reforms programme when economic ministers of Pacific Islands Forum member countries met in Palau in July.
In their Forum economic action plan 2007, the Polynesian kingdom was listed with countries like Nauru, Papua New Guinea and Samoa for having surged ahead with economic reforms.
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Talking economies... finance and economic ministers of Forum member countries in Palau.
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“Ministers heard these experiences reinforced the key message that amongst other factors, strong political leadership is necessary for reforms to succeed,” commented the action plan.
“This will enable a predictable policy environment that is conducive to private sector growth,” it added.
While the thumbs up given by the Forum Economic Ministers Meeting (FEMM) may displease pro-democracy campaigners in Tonga itself, FEMM 2007 is perhaps wanting to show that its concern and focus is purely economics, not political.
The latter is the business of islands leaders when they hold their annual Forum summit, to be held this year in Nuku’alofa, Tonga, in October.
Yet, still, in an era where the United Nations’ MDGs (Millennium Development Goals) is the watchword, purely economic meetings like FEMM could not meet in a vacuum and avoid talking about other issues like poverty reduction, gender equality and climate change.
At FEMM 2007 in Palau’s old capital of Koror, poverty and gender were not featured on the agenda, but climate change was.
Representing environmental ministers of Forum member countries, Palau’s minister for resources and development, Fritz Koshiba told FEMM 2007 that the region has lost more than US$1 billion through adverse weather conditions.
Bulk of that economic loss was from Cyclones Ofa and Val that caused havoc in the islands of the eastern Pacific in the 1990s.
Even the World Bank, Koshiba said, had done some work on the likely cost of climate change in islands like Kiribati and Fiji.
“A high island such as Viti Levu in Fiji could experience an average annual economic losses of between US$23 million-US$52 million, equivalent to losses of 2—4 percent of Fiji’s GDP from climate change,” said the Palauan minister.
“A low group of islands such as the Tarawa atoll in Kiribati could face an average annual damage from climate change of US$8 US$16 million, compared to its GDP of US$47 million with costs likely to be considerably higher in years of extreme weather events.
“Given the predictions by the world’s top scientist, however, it is clear that without strong measures to reduce global greenhouse gas emissions, comprehensive adaptation in many Pacific islands will be very difficult.”
FEMM 2007 however was not all that doom and gloom.
In its outlook for 2007, the Pacific Islands Forum Secretariat was actually predicting higher growth rates for most Forum Islands Countries, at least better than the estimated 2.7% growth rate of 2006. This year, average growth of islands countries should be around 3%, the Secretariat paper predicted.
Four factors, it says, will generate this growth are:
• Possible boost in remittance because of the seasonal worker scheme that began this year in New Zealand. Five thousand workers from Vanuatu, Tonga, Samoa, Tuvalu and Kiribati are involved.
• Aid receipts are also due to rise through the United States’ compact of free association with the Federated States of Micronesia, Marshall Islands and Palau.
• Through Virgin Blue airline, Samoa, Tonga and Vanuatu now have a “more reliable airline service” which is fuelling growth in tourism.
• Spin-offs from economic growths in the major markets of Australia, Japan and New Zealand
Like in FEMM 2006, economic ministers were told in Palau that they needed to work on the public perception that FEMM is mostly full of talk but no action.
Invited as the FEMM 2007 keynote speaker, Rick Hou, governor of the Central Bank of Solomon Islands, delivered a message similar to that presented to FEMM 2006 by leading Pacific economist, Dr Satish Chand, of the Australian National University.
“We are not short of documents to make reference to, we are not short of advice, the problem is, we just don’t implement,” said Hou.
“That is why I was using the picture of a patient. You go to the hospital, they tell you this is the medicine to take.
“But like many of us, we either just live with our sickness or we just refrain from taking the medicine, it’s just too difficult.”
Hou said the Forum need not look afar, as Samoa is a shinning example of a country that is now enjoying the benefits of sweeping economic reforms.
To be fair, FEMM 2007 has at least five plans for action.
• It wanted a feasibility study conducted on the possibility of establishing a sub-regional Customs service. This recommendation was based on a study conducted by the Pacific Islands Forum Secretariat, which noted that while revenue collection is still a major function of Customs services in the region, a sub-regional service can assist in more technical areas. This may include help in the interpretation and application of the harmonised system of tariff classification, proper valuation techniques, post-clearance audit techniques and risk-based approach for cargo clearance.
• Directed the Forum Secretariat to work with the World Bank in ways the matter of labour mobility can be enhanced in the Pacific. Ministers wanted a “closer examination of opportunities, challenges and constraints” raised by the pilot seasonal workers scheme of the World Bank in New Zealand involving ni-Vanuatu workers.
• Based on a study by University of the South Pacific’s Professor Ron Duncan, FEMM has asked the International Monetary Fund’s Pacific Financial Technical Assistance Centre (PFTAC) to pilot an arrangement where it oversees the delivery of technical assistance in the region. The Duncan Report had noted limited donor coordination and high transaction costs to islands countries in the area of technical assistance delivery. A recommendation by the Duncan Report that a new regional body should oversee this work was however not endorsed.
• The secretariat to convene a workshop to fine-tune the a package that will make the islands attractive for investment. The package is proposing a regional approach in the key areas of foreign investment, competition, pricing and access and consumer protection and fair trading.
• The Forum Secretariat will need to work with PFTAC in developing a regional mechanism that will regulate and supervise the islands’ financial sectors covering banks, insurers and pension funds. PFTAC had done a study on this proposal.
Economic ministers—perhaps picking up on a suggestion from the Forum Secretary-General Greg Urwin—also wanted changes to the way its agenda is set and implemented.
It wanted the agenda to be more focused, and allow more time for ministers to deliberate and discuss issues.
Presentations by experts should be done before the officials, not to them as is currently the practice.
“Presenters (should be) available during the ministerial plenary to answer questions if required,” the ministers said in their economic plan for 2007.
“The formal plenary should deal with agenda items issue by issue rather than clustering several items.”
The Forum Secretariat was further directed to provide a half yearly update on the progress made on FEMM decisions.
That officials can mislead their bosses was evident during FEMM 2007 when in opening this year’s plenary, host and outgoing president of Palau, Tommy Remengesau Junior decried the way the Forum was introducing free trade agreements like PICTA and PACER into the region, saying it has been introduced in a “round-about way.”
“The Pacific Plan currently envisions our nations becoming legally committed to trade agreements such as PICTA and PACER,” said Remengesau Jnr.
“While I do not know yet the ultimate outcome of this endeavour, it must be noted that we are all asked to join into this strategy despite the fact that the studies and discussions regarding the impact of such actions are not even completed.”
Both Urwin and one of his co-deputies Peter Forau, however, defended the approach the secretariat had taken.
Urwin said all that they have done was to invite Forum member countries like Palau to join negotiations for a free trade agreement.
Forau said the only feasibility study the Forum is doing concerns PACER, which has yet to be formalised.
Media access interestingly developed as a side issue of FEMM 2007 when a group of journalists led by Tia Belau publisher Moses Uludong petitioned FEMM chair Elbuchel Sadang, to open all FEMM sessions to the media.
Apart from the opening speeches, the main plenary of FEMM has always been a closed-door meeting, although the Forum Secretariat organises a media workshop and flies in journalists from around the Pacific to attend in collaboration with the Pacific Islands News Association.
“If they really believe in the principles of good governance and transparency that they constantly teach and preach about, then what is there to hide in their meetings,” said Uludong.
Urwin during the post-FEMM news conference noted that to open up FEMM to the media would be a “considerable departure from Forum practice.”
But the petition would be considered, he said.
“We have been working in the last couple of years to open up these meetings as much as we can. You’ll find for example that the NGO community has got access to a wide range of our meetings in a way that wasn’t the case before.
“Frankly, it’s a bit of a step to take as far as your petition did. But it is a moving frontier, now you have asked us about it, we’ll try to take it forward.”
Sadang was more apologetic and implied that the decision to keep their sessions closed was not the decision of the ministers.
“This organisation has been promoting good governance and transparency and we do not like to deviate from what we preach on those issues. So any inconvenience we have caused any media, we apologise for that. We want to assure you that we will take this very seriously and move forward to have an open policy on the media on the issues that we want to discuss.
“A lot of these issues are very critical to the development of each country and our people need to be informed of the decisions that the Forum has made.”
• Samisoni Pareti was hired as FEMM 2007 media workshop trainer in Palau.
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