Can the region protect their sovereign interests?

Maureen Penjueli



As the dust settles after the Pacific Islands Forum Trade Ministers meeting in Samoa (June 17 – 18),  Australian Trade Minister Simon Crean and New Zealand Trade Minister Tim Groser will be pleased with the outcome.
They certainly got what they wanted—commitment to enter into formal negotiations on PACER-Plus with islands countries immediately after the Leaders’ meeting in August in Cairns.
 In return, they have provided very little in way of financial support to establish a Trade Advisor’s position—just $500,000 per year over three years, a mere drop in the ocean in terms of the cost to run trade negotiations with smaller islands partners in the region.
 At the meeting, Islands Trade Ministers were taken aside by their Australia and New Zealand counterparts to a lunch meeting without their advisors and officials, and agreed, five hours later, to enter into negotiations immediately after the Leaders’ Meeting in August. 
Green room
negotiations
This manoeuvre is similar to the use of ‘green room’ negotiations at the World Trade Organisation (WTO)—often described as the most undemocratic process of decision-making at the WTO.
Worryingly, the ministers also agreed to complete negotiations within a five-year timeframe. Five years would be the best-case scenario for our islands leaders.
This would allow time for national consultation and research into the implications of PACER-Plus.
But it is unlikely that Australia and New Zealand will allow negotiations to go on for five years and they will most likely push for completion of negotiations in two years. 
In addition, Pacific Ministers agreed to enter into negotiations immediately after the Cairns Forum Leaders meeting in the absence of a fully functional regional office to assist the Pacific during negotiations (Office of the Chief Trade Advisor—OCTA).
Senior trade officials pointed out that the green room manoeuvre would not have been possible if not for the support from Samoa as the Chair of the meeting and the Secretary-General of the Pacific Islands Forum Secretariat (PIFS).
Some even commented it was reminiscent of the WTO 2003 Cancun Ministerial where the Mexican Chair, under pressure from developed countries, sidelined important development discussions in the Doha Development Agenda to instead discuss new trade rules on investment, competition and intellectual property rights (the Singapore issues). Very disappointing indeed, one official commented. 
The concessions made by islands countries in Samoa raise a fundamental question about whether islands countries can protect their sovereign interests in trade-related negotiations with Australia and New Zealand, which are not only members of the Forum but also key donors. 
At the earlier Pacific ACP Trade Ministers meeting, where Australia and New Zealand Trade Ministers were not present, islands countries stated, “national consultations were needed prior to any PACER-Plus negotiations and that OCTA had to be in place.”
They went further to state that “PACER-Plus issues needed to be considered very carefully, particularly as the implications for trade liberalisation are not always clear”.
Disappointing then, that after five hours these express concerns seem to have been overcome. The consolation prize for Island sTrade Ministers is that they were able to secure a commitment that “further and future funding for OCTA, building on the Australian and New Zealand contributions, can be also sought from other donors”. 
In addition, they could argue that they were able to also secure the independence of the governance structure of the OCTA. 
The stated need to proceed with caution and to ensure that necessary resources are in place to assist islands countries before, and during, any negotiations is a logical recognition of the realities of islands economies and capacities.
Reactions to the outcome of the Samoa meeting from some senior trade officials to whom I spoke to were mixed – anger at the way the process was undertaken but also admittedly, for some at least, a sense of powerlessness. For how can you bite the hand that feeds you?  
Suspicion
The Samoa meeting has raised the level of suspicion amongst islands countries, particularly the larger Melanesian countries that stand to lose the most from PACER-Plus, that some of the smallest states will set a poor precedent on PACER-Plus by conceding to Australian and New Zealand demands early. The small states are viewed as those least able to resist Australia and New Zealand pressure in all its forms. 
Increasingly the perception is that the Forum Secretariat is becoming irrelevant for the Forum Islands Countries.
The secretariat is perceived by many to be beholden to Australian and New Zealand interests rather than a body to assist them in preparation for PACER-Plus negotiations.
The temporary housing of OCTA at the Pacific Islands Forum Secretariat before it is moved to Vanuatu is eyed suspiciously. 
The growing division between the Pacific islands does not bode well for regional solidarity. The upcoming trade negotiations are set to challenge the fundamentals of the Pacific Way.
The use of consensus to reach decisions and lack of transparency in trade talks may need to be changed if islands countries are to have any chance in protecting their sovereign interests and effectively address the ill-effects of hasty liberalisation. 
Tied aid and the politics of power have blurred the landscape for genuine trade and development discussions. As pointed out by one senior official, the time may have come for the region’s islands leaders to relook at the original vision of the region’s forefathers and to map out an alternative Pacific Way.
A way that will guide the region through the difficult challenges that it faces – climate change, the global financial crisis and human security issues – without the interests of Australia and New Zealand dominating the islands’ agenda. 

*Maureen Penjueli is the Coordinator for the Pacific Network on Globalisation.