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PACER Plus, OCTA and FICs: beggars can’t be choosers


(Pacific Scoop, 30 April 2012)  

  Everyone knows that PACER Plus negotiations, if successfully conducted by Office of Chief Trading Adviser (OCTA), have the potential for offering major development benefits to Forum Island Country (FIC) peoples.

The most important benefit should be generous access for unskilled guest workers to Australia and NZ, to assist in employment of unskilled FIVC people, and the strengthening of remittance flows of valuable foreign exchange, in return for trade liberalisation.

FICs however allege that Australia and NZ are dragging their feet when it comes to the funding of the  (OCTA) which is supposed to be the secretariat for PACER Plus negotiations.

FICs are also concerned that Australia and NZ are not keen on OCTA doing work on the EPAs with European Union.

Both these criticisms may well be true, given the departing comments of Dr Chris Noonan, the first director of OCTA who resigned within a couple of years of taking up the post.

But FIC leaders must ask themselves two questions:

1. Why are FICs not funding OCTA themselves, using their own financial resources?

2. Why does the OCTA agenda not include all international trade and service relationships, in particular, closer economic ties with US and Canada, who have the potential to offer far more benefits, and much faster, than Australia and NZ?

On both questions, why do FIC leaders not understand the popular saying “he who pays the piper, calls the tune”, and that “beggars cannot be choosers”.

FIC leaders need genuine independence and a greater willingness to pay for genuine sovereignty over their organisations, and not pay lip-service to these important concepts in the constitutions of these organisations.

Lack of progress on PACER Plus

  In a recent Island Business article, Dr Chris Noonan the first Director of OCTA,  was asked whether OCTA had enough financial resources for the range of tasks that were being set by FICs. Noonan’s answer was quite revealing:

“One part of our mandate was to seek funding from donors other than Australia and New Zealand. … Some additional funding has been sought from a couple of sources, but nothing has been confirmed yet.  If we were restricted to the resources provided by Australia and New Zealand at present, we could not provide the sort of services or support the FICs require for these sorts of negotiations.”

How much does OCTA need?

  Fast forward to 12 March 2012.

OCTA and Australia/NZ have apparently agreed on the funding arrangements which would apparently give OCTA the relatively small sum of one million Australian dollars per year for two years.

The new Chief Trade Adviser (Dr Kessie) said (Press Release on OCTA website):  “I thank the Government of Australia for the funding resources provided. These funds will  enable OCTA to continue providing independent advice and technical support to our members in PACER Plus negotiations.”.

This is quite contrary to Noonan’s view.

Dr Kessie went on:  “With funding negotiations concluded, we can now look forward to making substantive progress in PACERPlus negotiations with a view to coming up with a truly developmental trade agreement that would promote economic growth and sustainable development of the FICs as aspired to by PACER Plus parties.”

Funding negotiations already “concluded”?   But what about Dr Noonan’s point that he was hoping for other donors to come in with funding that would make OCTA more independent of Australia and NZ in the Pacer Plus negotiations, and also allow OCTA to provide assistance on EPAs with the European Union.

But why are FICs even asking Australia and NZ to provide this mere one million Australian dollars per year?

Why are FICs not providing funding to OCTA themselves so as to obtain real sovereignty over OCTA?

Unfortunately, as employees of OCTA, neither Dr Noonan nor Dr Kessie could tell these thirteen FICs which include PNG, Fiji, Solomon Islands etc etc. that for FICs even one million dollars a year for OCTA is peanuts, given that they have wasted hundreds of millions of dollars on all kinds of financial disasters and scams.

Fiji alone has wasted $200 millions on the National Bank of Fiji disaster, $100 million on the Agricultural Scam and the Commodity Development Fund; at least $200 million on the FNPF investment disasters in Natadola and Momi Bay; hundreds of millions of over-expenditure on the Fiji military since the 1987 military coups; and no one knows how much is going to be lost out of FNPF’s stupid $100 million loan to FSC and equally risky $200 million loan to Air Pacific.

OCTA employees also cannot remind the FICs of the hundreds of millions lost though corruption and scams by Nauru, PNG and Tonga.  Nor the tens of millions lost by the Trust Funds of Kiribati and Tuvalu because of the Global Financial Crisis.

And FICs cannot find a miserly one million or even five millions per year for OCTA?

Note also that Kessie stated that the OCTA objectives included “development of the FICs as aspired to by PACER Plus parties”.  “PACER Plus parties” include Australia and NZ.

But OCTA was created to assist the FICs, not Australia and NZ, who have their own armies of advisers.

Of course, the constitution of OCTA blabs on about being accountable only to FICs. But is it just lip service and empty rhetoric?

How determine the OCTA agenda?

  It is surely natural that Australia and NZ don’t want their funds to be used for assisting FICs on EPAs with the European Union.  Let the EU pay for this.

The same problem plagued Forum Secretariat ten years ago, when they put all their negotiation eggs into the EPA basket, ignoring the PACER Plus (contrary to my futile advice).

Why did the Forum Secretariat spend millions on negotiation strategies for EPAs and not PACER?

Easy answer: the EU was giving them the sacks of dollars for EPA negotiations, all spent on consultancies after consultancies and regional talk-fest meetings after meetings which FIC leaders and civil servants enjoyed thoroughly.

Australia and NZ did not give them money for PACER; neither did FICs give them any money for PACER. So PACER was largely ignored by Forum.

Ten years later, the positions are ironically reversed:  even though the FICs have got nowhere with the EPAs (PNG and Fiji merrily go their own way on EPAs); Australia and NZ are giving tiny sums of money to “assist” OCTA on PACER Plus, but not on EPAs.

And still, FICs are giving OCTA nothing, but complain that Australia and NZ are controlling the agenda and pace of work of OCTA.  Oh dear.

How can FICs determine the FIC agenda?

  A better OCTA’s agenda

  FICs need to ask themselves a far more basic question: what should OCTA be working on in the area of international relations if the ultimate objective is to improve the welfare of FIC peoples?

Why worry that Australia and NZ are dragging their feet on PACER Plus?

Why worry that the EU is dragging its feet on EPAs? (In fact, the EU has very successfully used the old colonial strategy of “divide and rule”, where PNG and Fiji have been bought off with some lollies, leaving the rest of the FICs with very few bargaining chips.)

But, why are FICs and their organisations like OCTA (or Forum Secretariat) not negotiating with other developed and developing countries in the world who can offer FICs real benefits?

United States and Canada, for instance, are opening up to large numbers of workers from Philippines and the West Indies in all kinds of categories. Why are FICs not investigating there?

Perhaps FICs should concentrate on sports that the Americans play, such as American grid iron football and baseball, to which we can send Pacific teams (we can’t send any to Super 14 Rugby).

Large numbers of Fiji solders are working for the British army or private US contractors on the other side of the world.  Australia and NZ, with a massive border area to patrol, have failed to employ solders or marine personnel from all the FICs which have a surfeit of extremely skilled personnel in these areas, such as Fiji, Tuvalu, Kiribati, Tonga.

Instead, Australia riskily allows US soldiers to be stationed on Australia’s north borders- irritating China especially if the numbers of US soldiers increase. China would have no objections to more Australian soldiers posted there, whatever their skin colour and ethnicity?

Indeed why are FICs not asking China and India for assistance in the many development areas where these countries have made incredible advances in agriculture, information technology, food processing, infrastructure, to name just a few? How ironic that the Fiji Military Regime has been so successful in doing this.

The bottom line is this:  FICs and their regional organisations need to pursue international trade and development possibilities with any country in the world which can offer them significant benefits, and not be limited to PACER Plus or the EPAs, or to deals with Australia and NZ, and the EU.

FICs need genuine sovereignty over OCTA and Forum Secretariat

  It is quite clear that whatever the rhetoric in the constitutions of OCTA and Forum Secretariat, the FICs do not have any real sovereignty over their budgets, the appointment of the key professional staff, the agenda for research and advice, and their activities.

Because FICs do not provide the bulk of the finance of these organizations.

If Australia, NZ and other donors provide the funding, they will determine where these organisations go. That is realpolitik.

Note also that without financial control by FICs, these organisations have little emphasis on capacity building of FIC citizens for the long-term.

If FICs were to examine what expertise was developed and left in the Pacific after all the negotiations for PICTA and EPAs, they will find that 95% of the services were provided by consultants from Australia, NZ, and elsewhere, and they have all gone (probably waiting for more consultancies).

You could probably count on one hand, the number of regional technical experts built up by the Forum Secretariat exercises.

The same will happen with OCTA unless FICs determine otherwise.

A different future for OCTA?

  FICs might consider the following recommendations in order to get the maximum out of OCTA:

1. Set an annual budget for OCTA starting with A$2 million dollars a year (to increase if the agenda is increased) to be divided up amongst the FICs in proportion to their GNP as recorded by the World Bank (in US$).  Richer FICs will contribute more, poorer      FICs will contribute less, and their benefits will roughly be in proportion to what they spend. [PNG with its massive new LNG revenues could probably pay for the whole lot, but the other FICs would be well advised to maintain their own self-respect by paying their own fair share].

2. Return the sums given by Australia and NZ.

3. Totally determine the research and activities agenda for OCTA, increasing the amount allocated in (1) if necessary. If FICs are themselves paying for consultants, research and meetings etc, they are not going to be wasting money on un-necessary work or unnecessary regional jaunts and meetings.

4. Each FIC be allowed to second as many technical trade officers to the OCTA, at their own expense, to act as research associates, assistants and under-studies for any international expert technical consultants hired by OCTA.  They may be, but do not have to be based in Vila (which is extremely expensive); they may also be “Adjunct Fellows” of OCTA based in their home countries, while working with OCTA.

5. Choose the least cost locations for any needed regional meetings (which must be kept to a minimum), with the costs of attending being totally paid for by the countries themselves. If any FIC thinks that the benefits are not worth it, they will not waste their scarce human resource time attending.  (Of course, if someone else is paying, they will willingly go for a holiday.)

These five rules should also be applied to Forum Secretariat and all other CROP organisations, if the FICs have any real self respect and really want genuine sovereignty over their organisations.

Will any of the above five happen? Sadly, the answer is probably “no”.

Decades of aid dependence has created in FIC leaders and senior civil servants a sorry mix of “begging bowl mentality” combined with the “delusion of sovereignty” which encourages them to complain when donor priorities are followed rather than FIC priorities.

They refuse to acknowledge that those who pay the piper, will continue to call the tune.

While beggars cannot be choosers.

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