Some lessons to be learned from row over Chinese aid

Friday January 12, 2018 Published in Letters to the Editor

It was interesting to hear on Wednesday morning’s Radio Cook Islands-RNZ International and Pacific News report, comments attributed to Senator Concerta Fierravanti-Wells, Australian Minister for International Development and the Pacific.


Last October Fierravanti-Wells visited our Te Ipukarea paradise to reinforce the strong ties between our two countries, and while here, to discuss issues relevant to both of our countries mutual interests.

No doubt Australian aid would have been to the fore, with firm and transparent discussions of the likely outcomes and obligations, with a quid pro quo expectation from Australia's perspective, likely to have been understood and accepted by our own government. 

This has always been a transparent and open understanding that both New Zealand and Australia have made known to their Pacific Islands counterparts, so as to assist their economic understanding and ability to better discern the best use of their aid money.

Also, it is imperative that Pacific countries have full understanding of their obligation to repay long-term loans, which generally are provided to developing countries with favourable terms and safeguards. They are given subject to the countries’ economic ability to repay, and the terms are negotiated to the mutual satisfaction of the donor and the country receiving the funds. Some of these funds also become grants to further assist with economic development and future growth.

As reported in the Australian daily, The Australian, Senator Fierravanti-Wells, Minister for International Development and the Pacific, bluntly criticised China's US$1.7 billion investment in the Pacific since 2006 on more than 200 projects, consisting of "very large buildings, white elephant projects and roads to nowhere being built", as nothing more than cheque-book diplomacy, with funds being lent to Pacific Islands countries on unfavourable lending terms.

In many cases, those Pacific Islands countries who have foolishly accepted these unfavourable terms, have done so with severe consequences. Many of these countries lack the capacity and economic ability to repay their loans, bearing in mind that said loan comes complete with the whole Chinese package of architects, engineers, construction company and their own workers, materials from China, etc.

As already pointed out by many who have written about the potential problems associated with these unfavourable loan terms, it appears obvious that the quid pro quo expected from these Chinese funders, involves more and political pressure to acquiesce and allow further foreign investment in domestic businesses.

Now these former local businesses are no longer locally owned and run by the locals, but instead are run and operated by the foreign partner, their family and their own foreign workers.

In Samoa and Tonga, these new business owners are now becoming subjected to assaults, as a result of simple frustration and resentment on the part of locals. 

I can only suggest that our sister islands of Samoa, Tonga and Fiji be looked at as examples of where our tiny and fragile, and still developing paradise appears to be heading. As a result of Chinese investment, the Samoan, Tongan and Fijian societies are changing, and there has been a detrimental effect on their culture, their traditions, their language and their way of life. The same thing will happen to us should we too, foolishly, choose to go down this path.

So let us be prudent and as a country, live within our means.

Those who have had the aroha, courage and foresight to warn us of the consequences of foreign investment have done this because trapped, betrayed and utterly disconsolate of about their countries’ future and indeed their own futures. 

We should listen to them when they say,“be careful!"

            - Papa Williams

1 comment

  • Comment Link Vouvou Pa Mitten Saturday, 13 January 2018 05:20 posted by Vouvou Pa Mitten

    Dear Editor,
    We should take great of heed of the wise counsel offered by Papa Williams and consider the ancient expression, " beware of Greeks bearing gifts". The Cook islands and indeed other South Pacific island nations should be seeking more aid from Australia and New Zealand, particularly so with the Cook Island people being New Zealand citizens. As New Zealand citizens I believe you have more right to aid from New Zealand, both financial and other assistance particularly so for health,education, infrastructure and so on.The rising tide of Chinese movement and influence into our South Pacific island nations must be checked otherwise our grandchildren will one day ask why we ever allowed this to happen.
    Vouvou Pa Mitten
    New Zealand.

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