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### Viewing cable 06WELLINGTON451, INITIATING A DIALOGUE: NEW ZEALAND ACTIONS IN THE

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06WELLINGTON451 | 2006-06-13 00:04 | 2011-04-28 00:00 | CONFIDENTIAL | Embassy Wellington

`

    VZCZCXRO6290
    RR RUEHPB
    DE RUEHWL #0451/01 1640004
    ZNY CCCCC ZZH
    R 130004Z JUN 06
    FM AMEMBASSY WELLINGTON
    TO RUEHC/SECSTATE WASHDC 2886
    INFO RUEHBY/AMEMBASSY CANBERRA 4437
    RUEHPB/AMEMBASSY PORT MORESBY 0572
    RUEHSV/AMEMBASSY SUVA 0474
    RUEHC/DEPT OF INTERIOR WASHDC
    RHHMUNA/CDR USPACOM HONOLULU HI
    RHHJJAA/JICPAC HONOLULU HI

` `

    C O N F I D E N T I A L SECTION 01 OF 04 WELLINGTON 000451

    SIPDIS

    SIPDIS

    STATE FOR EAP/FO, EAP/ANP
    PACOM FOR J2/J233/J5/SJFHQ
    INTERIOR FOR DAS COHEN

    E.O. 12958: DECL: 06/08/2016
    TAGS: PREL NZ
    SUBJECT: INITIATING A DIALOGUE: NEW ZEALAND ACTIONS IN THE
    PACIFIC AND OPPORTUNITIES FOR COOPERATION

    (U) Classified By: Deputy Chief of Mission David R. Burnett,
    for reasons 1.4(b) and (d).

    -------
    Summary
    -------

    ¶1. (C) Ministry of Foreign Affairs and Trade (MFAT) officials
    say New Zealand's main areas of concern in the Pacific are
    governance, economic stability and security.  New Zealand is
    revising its approach to and strengthening engagement with
    Pacific Island countries (PICs), and is coordinating more
    with other countries with interests in the region (notably
    the European Union, France, China and Japan).  MFAT suggests
    increased information sharing about what the United States
    and New Zealand are doing in the Pacific, improved
    coordination in regional fora (especially the Pacific Island
    Forum Post-Forum Dialogue), and greater dialogue in the
    management of Pacific fisheries as three potential areas for
    U.S.-New Zealand cooperation.  End summary.

    --------------------------------------------- ----
    Initiating a Dialogue on Shared Pacific Interests
    --------------------------------------------- ----

    ¶2. (SBU) On June 1, DCM and Emboffs met with representatives
    of MFAT for a high-level discussion about New Zealand's
    activities and interests in the Pacific.  Deputy Secretary
    Alan Williams led the New Zealand side, accompanied by Dell
    Higgie, Director of the Security Division; Heather Riddell
    Director of the Pacific Division; Marion Crawshaw, Deputy
    Director of the Pacific Division (Bilateral Relationships);
    and Niels Holm, Deputy Director of the Pacific Division
    (Regional Relationships).

    ¶3. (C) Williams said he was struck by EAP Assistant Secretary
    Hill's "unrequited appetite about what New Zealand is doing
    in the Pacific."  New Zealand and the U.S. once held regular,
    documented conversations on respective activities in the
    Pacific, but Williams said New Zealand turned off that
    dialogue when budget cuts constrained resources.  Williams is
    eager to resume contact and invited Emboffs to meet with him
    and the Pacific Division every five to six weeks.  DCM
    Burnett agreed this would be helpful, noting that often our
    exchanges have been crisis (e.g. Solomons and Papua New
    Guinea) or event driven (Samoan elections) rather than
    proactive.

    --------------------------------------------- -------
    Areas of Concern: Governance, Economic Stability and
    Security
    --------------------------------------------- -------

    ¶4. (C) Williams said MFAT's Statement of Intent, which
    outlines GNZ's overarching foreign policy goals, highlights
    the agency's goal of redefining engagement in the Pacific to
    promote regional stability and development and reduce risks
    to New Zealand's security and trade.  He also noted that the
    Pacific Islands rated second only to sub-Saharan Africa for
    poor performance on the Millennium Development Corporation's
    indicators of development.

    ¶5. (C) On governance, Williams is concerned about
    undemocratic trends in the so-called "Arc of Instability"
    encompassing Melanesia, and referred to the region as "close
    as we come to failed states in our region."  He recognized
    that while New Zealand's provision of targeted development
    and good governance assistance to the region was expanding,
    weak institutions and political instability continue to pose
    risks.  New, more active approaches by Australia and New
    Zealand are needed, including in the Regional Assistance
    Mission in the Solomon Islands (RAMSI).

    ¶6. (C) Crawshaw reported that New Zealand is (in the last
    eight or nine months) moving past the post coup environment
    in Fiji.  New Zealand is watching with interest as the Prime
    Minster puts together Fiji's first multi-party cabinet.
    While not expecting the arrangement to last, MFAT views the
    process as a positive step toward building cross-party
    relationships that will later contribute to stable governance.

    ¶7. (C) While New Zealand's concerns in Melanesia are

    WELLINGTON 00000451  002 OF 004

    principally about governance and security issues, in
    Polynesia, the worry is about the lack of economic
    development, demographic challenges, the threat of HIV/AIDS,
    and land ownership issues.  MFAT said the quality and nature
    of the interventions made by external partners are critically
    important to prosperity and stability in the region: a bit
    more cultural sensitivity, including the need for buy-in by
    host governments, is definitely needed.

    ¶8. (C) "We're even facing the winds of change with
    long-standing Polynesian partners," Williams said, among whom
    "even the most successful and best governed countries are
    having problems with law and order such as in Tonga, which is
    the last of the feudal monarchies."  "The king is ailing in a
    New Zealand hospital," Williams continued, "and we're
    expecting rapid and intensive change."  Williams explained
    that with a large population of Pacific Islanders in New
    Zealand (especially Polynesians), "Pacific issues quickly
    become domestic issues."  Thus New Zealand is necessarily
    deeply involved in Tonga reform discussions, while flirting
    delicately with the bounds of interference. New Zealand
    concerns in Micronesia are similar to those of Polynesia.
    While GNZ acknowledges that its engagement with Micronesia is
    less robust, it also realizes that Micronesia is a critical
    partner for regional economic stability, particularly for
    sustainable fisheries.

    ¶9. (C) As GNZ revises its engagement with the Pacific, it is
    adopting a listening approach in which New Zealand "has some
    humility that we don't have all the answers." Riddell
    highlighted the difficulty of promoting good governance where
    institutions of democracy might be incompatible with cultural
    structures (e.g. Solomons and Papua New Guinea) where there
    is not a strong sense of statehood, and where loyalties are
    at the sub-state level (such as provincial governments) or to
    particular institutions (such as the police). (NB: Andrew
    Ladley, Director of the Institute of Policy Studies, School
    of Government, Victoria University of Wellington -- a legal
    scholar focusing on democracy in Pacific -- has similar
    views.  Ladley asserts, for example, that election processes
    in many Pacific countries are based on deeply ingrained
    patron-client relationships and institutionalized bribery.
    Legislators do not seek reelection to office but rather treat
    their terms in office as one-time opportunities to loot
    government coffers and reward friends, Ladley said, resulting
    in high legislator turnover -- more than 80 percent in Papua
    New Guinea and between 60 and 70 percent throughout the
    Western Pacific.)

    ¶10. (C) Riddell said in these fragile democracies, there are
    obstacles to good governance on both the demand and supply
    side.  People do not demand democratic governing structures
    because they've never had them.  On the supply-side, these
    countries are "coming toward the end of their post-colonial
    generation and we're not seeing the next generation."  The
    DCM said because cultural institutions are breaking down,
    traditional processes are not in place to supply the next
    generation of leaders.  Williams said GNZ is using its
    Pacific Partnership visitor program to address the leadership
    gap by, for example, bringing provincial governors from the
    Solomon Islands to New Zealand to experience New Zealand's
    system of governance first hand.

    -------------------
    Economic Stagnation
    -------------------

    ¶11. (C) The MFAT participants lamented limited economic
    progress in the region.  Beyond fisheries and Papua New
    Guinea's mineral resources, Niels Holm, Deputy Director of
    the Pacific Division said, the region has few natural
    resources on which it can rely.  MFAT recognizes that trade
    and economic growth is not proceeding quickly enough to
    respond to population growth in the Solomons and other
    Melanesian countries.  The MFAT officials were not all doom
    and gloom, noting that a number of countries (even Papua New
    Guinea) are showing better growth than at any time over last
    20 years and that regulatory reform in countries such as the
    Cook Islands and Samoa appear to be yielding real economic
    returns.

    ¶12. (C) Holm said the PICs share a number of disadvantages,

    WELLINGTON 00000451  003 OF 004

    such as low skills, limited natural resources, poor
    communications links, and rapidly declining or expanding
    populations.  Despite the PICs' inclination to respond to
    these challenges individually, they would benefit from
    collective action, particularly for problems such as bird flu
    and security.  The Pacific Island Forum should pull back from
    a bias towards policy implementation by individual
    governments and instead focus on defining regional policy and
    achieving buy-in, Holm said.

    ¶13. (C) Pacific nations are plagued by low levels of capital
    where governments, often the only modern institutions, are
    hampered by problems of culture (such as land tenure issues)
    and tend to excessively regulate so that "even panhandlers
    need a license," Holm said.  Despite the fact that fisheries
    are the only significant natural resources in the region,
    Pacific nations still operate on the "Olympic principle of
    the first one out gets the fish" and not the principle that
    sustainable fisheries is "not about managing fish but
    managing the fisherman," said Holm.  While he noted that it
    was important to harmonize donor effort and minimize conflict
    between New Zealand, Australia, United States, China, Japan
    and the European Union, regional cooperation is mostly about
    recognizing "interdependence and promoting self-reliance and
    a business friendly environment."

    ¶14. (C) Expressing frustration with the Pacific Agreement on
    Closer Economic Relations (PACER) and the Pacific Islands
    Countries Trade Agreement (PICTA), Holm said, "until we have
    a regional trade framework that works, we're going to have a
    problem with economic stability in the region."  (NB: Vince
    McBride, Executive Director of the Pacific Cooperation
    Foundation and a retired New Zealand diplomat with extensive
    development experience in the Pacific, separately told Poloff
    that a gross Pacific Island trade imbalance in favor of
    Australia and New Zealand needs correction for the longer
    term viability of the economies of Pacific Island Countries
    (PICs).)

    ---------------------------------------
    Security Concerns and Capacity Building
    ---------------------------------------

    ¶15. (C) On security, Higgie highlighted the PICs' acute
    capacity issues with meeting international counter-terrorism
    obligations, and said the PICs believe the international
    community has imposed obligations without adequate
    consultation.  Higgie said in fact there had been
    coordination with the PICs' UN missions, but that they suffer
    from the same type of capacity issues that afflict PICs in
    general (e.g. dearth of skilled personnel, insufficient
    financial resources, weak communications infrastructure, and
    -- in some cases -- lack of political will).  The
    international community needs to consider whether it will
    "modulate" CT requirements to address these very real
    capacity issues, she added.

    ¶16. (C) The Pacific Islands Forum (PIF) Working Group on
    Counter-Terrorism (WGCT) held a regional CT tabletop exercise
    (Exercise Ready Pasifika) in Suva in November 2005.  During
    the debriefing portion of the exercise, PICs representatives
    identified as a weakness the general lack of national
    frameworks for counter-terrorism.  Recognizing the capacity
    issues faced by the PICs, Australia offered to draft a
    template; New Zealand further suggested drafting an "all
    hazards" plan, believing that it would achieve better buy-in.
     Interestingly, some PICs wanted to develop stand-alone CT
    plans, believing that global best CT practice requires a
    separate plan.  They did see the plans as a de facto audit
    tool for other action plans, such as hurricane response,
    however.  Other PICs responded that if they faced a real
    problem, they would just call on New Zealand or Australia.
    Higgie said she responded "fine, but have you investigated
    the law to see if the legal authorities are there?  Can we
    attach Status of Forces agreements?  Are there opt in/opt out
    clauses?"   Williams added that PIF meetings had migrated to
    a perspective of asking how to meet national needs within a
    regional framework. "After all, we are ourselves a Pacific
    Island country," he said.

    -----------------------------
    Opportunities for Cooperation

    WELLINGTON 00000451  004 OF 004

    -----------------------------

    ¶17. (C) Williams said he shared USG interest in bilateral
    cooperation in the Pacific, and said GNZ has also been
    revising its programming language to note the importance of
    working with the EU, Japan, and China.  For example, he said,
    over the last six months, GNZ has increased its level of
    diplomatic interaction with the European Union, asking that
    it not ignore the Pacific in favor of Africa.  GNZ has also
    told Japan its interests in the region should be broader than
    just the International Whaling Commission (IWC).  On June 21,
    New Zealand will host a high-level Chinese diplomat to
    discuss Pacific regional cooperation.

    ¶18. (C) "France has been sending signals about where it wants
    to be involved -- in police training and intelligence," said
    Williams.  In May, the heads of mission from France's Pacific
    posts met in New Zealand.  During that visit, they also met
    with GNZ officials to discuss mutual interests.

    ¶19. (C) "Can the region be all that it can be without U.S.
    involvement?" asked Williams rhetorically.  "There's a lot we
    could and should be doing" Williams continued.  For example,
    a Pacific Island Forum review team is investigating how to
    improve the quality of the dialogue from the regional
    architecture: the PIF, the Post Forum Dialogue and the
    multiplicity of other regional fora.  "We need better
    choreography so that Chris Hill has time to talk to leaders."
     When the review team visits Micronesia, U.S. assistance
    suggesting contacts would be helpful, Williams added.

    ¶20. (C) Williams offered to provide a revised Pacific
    strategy paper (an "environmental scan" as he called it)
    submitted to Cabinet earlier this year, which summarizes
    GNZ's activities in the PICs.  DCM Burnett said that the
    Embassy would see if Washington could provide a similar
    document from our sub-PCC process.  Williams said his Pacific
    Division should share relevant reporting with the Embassy,
    and recommended scheduling a regular meeting every five to
    six weeks with Emboffs and the Pacific Division to discuss
    recent events and explore possible areas of cooperation.
    Williams also welcomed the opportunity for a high-level
    policy discussion, noting that he intended travel to
    Washington later in the year, and that he would be happy to
    swing through Hawaii.

    ¶21. (C) Pol-Econ Couns recalled A/S Hill's interest in New
    Zealand's use of trust funds for delivering official
    development assistance (ODA).  Williams said that New Zealand
    is increasing its use of trust funds in Tuvalu, Niue,
    Tokelau, and would share more information on their use.

    ¶22. (C) Williams also asked to what extent the U.S. Coast
    Guard remains engaged in fisheries management in the Pacific,
    noting that New Zealand and France are discussing possible
    exchange of data within the FRANZ cooperative arrangement.
    Williams asked how the U.S. and New Zealand exchange
    fisheries-related satellite data.  He noted that as New
    Zealand rolls out its new multipurpose vessels, it could be
    useful to discuss New Zealand's role in patrols of Pacific
    fishing areas.

    ¶23. (C) Comment:  Sydney Morning Herald columnist Peter
    Hartcher, in an article picked up by the June 12 Dominion
    Post, warned that if Australia and New Zealand do not want to
    see places like East Timor "lapse routinely into chaos" and
    "become a permanent dependency," they need to revise their
    engagement with the Pacific and avoid a "moral hazard" where
    Pacific governments find their incentives toward good
    governance and economic development reduced by offshore
    arbiters of law and order and providers of financial
    assistance.  As we move forward cooperating with Australia
    and New Zealand on Pacific Island issues, we will need to
    explicitly address this issue.
    McCormick

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