Maldives and China sign 50 million yuan grant aid agreement

The Maldives and China have signed a grant aid agreement worth 50 million yuan (US$ 8.2 million) last week.

The Agreement on Economic and Technical Cooperation is “for the implementation of developmental projects and the advancement of public services,” the President’s Office has previously said.

The Minister of Foreign Affairs Dunya Maumoon signed the agreement on behalf of the Government of Maldives and Mr. Yu Hongyao signed on behalf of the Government of the People’s Republic of China.

China has also pledged assistance to restore Kaafu Atoll Island Dhiffushi Island School after a fire destroyed the school’s offices in November.

The grant aid comes at a time the Maldives is facing dire economic circumstances, with the government unable to afford its huge recurrent expenditure on a bloated civil service and is failing to pay millions of dollars owed to state-owned companies for services such as oil and electricity.

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Fiji: a case study in the realities of Commonwealth suspension

As Maldivian politicians contemplate renouncing the country’s membership in the Commonwealth amidst threats of suspension, a sign of some of the implications the country may face should this come to pass can be seen in the Pacific Ocean-based island nation of Fiji.

In September 2009 Fiji was itself suspended from the Commonwealth, a 54 member state intergovernmental organisation rooted in the former British empire,  after Fiji’s military heads refused to hold previously-agreed elections in 2010 after coming to power.

Fiji’s suspension had significant economic and diplomatic ramifications for the island nation after some foreign powers began to see the country as a “rogue state”, resulting in a significant drop in aid and other assistance, according to New Zealand-based geopolitics consultancy, 36th Parallel Assessments.

Estrangement

Fiji found itself facing “estrangement” from western aid and other technical programmes after it was suspended from the Commonwealth three years ago.

Fiji’s suspension from the Commonwealth saw the country isolated from “aid donors aligned to western democracies”, observed Selywn Manning from 36th Parallel Assessments.

“This brand of authoritarian government caused aid donor nations and bodies (most significantly donor funds from the European Union) to be cut. Donors became reticent to commit development funds to Fiji, and indeed the Commonwealth member states in the Pacific region used this withdrawal of aid funds as a lever to pressure Fiji to return to democratic rule,” Manning explained.

The suspension also led to a shift in attitudes towards investment and business spending in the country, particularly tourism.

“Fiji’s isolation was made worse for its people due to the Commonwealth suspension decision following on from the position taken by the Pacific Islands Forum – a body consisting of 16 independent south/west Pacific islands states. The Pacific Islands Forum leaders had earlier decided to suspend Fiji until it recommitted to free and fair democratic elections,” Manning said.

“Fiji’s refusal to do so caused Australia and New Zealand to express a foreign policy that enforced travel and visitor sanctions levelled against Fiji’s ruling military elite and their families. The two western aligned nations also successfully lobbied the United Nations secretariat to de-commission, or discontinue, Fiji soldiers from taking part in peacekeeping operations around the world. The consequence of these moves caused Fiji’s economy to suffer. By late 2008, Fiji’s economy was in recession and this in-turn impacted on the livelihoods of ordinary Fiji families.”

International standing

The vacuum left by Western-aligned interests was quickly filled by other countries, especially China, Manning said.

China became the “most significant” of these external powers to befriend Fiji whilst more “Western aligned” bodies such as Australia, New Zealand and the wider Commonwealth organisation effectively enforced “estrangement” on the nation, he said.

“The People’s Republic of China (PRC) committed to aid and donor programmes and Fiji’s people began to notice positive change. PRC funds permitted the military regime to put its soldiers to work building new roads and improve infrastructure and government owned facilities. The military regime also permitted an increase in Chinese enterprise to establish inside Fiji, while western foreign and private investment stagnated or declined,” he said.

According to Manning, as Fiji has begun to accede to international pressure to host democratic elections by 2014, one of the key drivers towards the development was the belief that China’s donor support did not account for losses incurred by Commonwealth suspension.

“There are two elements that are able to be identified as significant influencers in [terms of scheduling elections for 2014]. The Peoples Republic Of China’s committed donor programme does not replace in dollar terms the loss Fiji has experienced to its total aid funds received ledger,” he explained.

“This has caused Fiji’s military government to move to sustain donor funds from the PRC while inching toward recreating Fiji as a post-coup democratic state,” he added. “Should elections be held in 2014, Fiji anticipates western aid funders will re-establish contact with its government and re-commit to assistance programmes.

“The second element is the United States’ position to establish warm relations with Fiji, encourage foreign investment in a post-election period and welcome Fiji back as a nation on friendly-nation status terms.”

While it remains suspended from the Commonwealth, Manning said Fiji has still been able to represent itself before the general assembly of the United Nations. However Fiji’s relationship with its wealthy neighbors, Australia and New Zealand, remained terse.

Manning added that Fiji had also retained membership in the Melanesian Spearhead Group (MSG), a four member inter-governmental body that includes Papua New Guinea (PNG), Solomon Islands and Vanuatu among its representatives.

“The Melanesian Spearhead Group (MSG) did not suspend Fiji but has given Fiji a degree of legitimacy around the Pacific region,” he noted.

“The MSG was usually dominated by Papua New Guinea’s wishes, but since 2010, PNG has supported Fiji’s Prime Minister and military leader Commodore Voreqe (Frank) Bainimarama’s chairmanship of the Melanesian bloc,” he said. “Once stable in the role, under Bainimarama’s leadership, Melanesian nations have moved to establish unprecedented independence – most recently Melanesian leaders agreed to establish a regional security force called The Legion which would arguably replace regional assistance missions led by Australia and New Zealand should civil unrest cause a Melanesian state to require external assistance to quell an uprising.”

As well as defence agreements, the MSG is also said to have moved to represent its members among global bodies without having Melanesian countries go through the Pacific Islands Forum. Funding to do this has come from donors including the People’s Republic of China, Timor Leste, and Luxembourg.

National mood

Asked how the Fijian public viewed the Commonwealth’s actions to suspend its membership, Selwyn responded that it was hard to identify a particular national mood, owing to the country’s strongly-polarised society around two distinct ethnic groups.

Of these two groups, indigenous Fijians and the Indo-Fijian population, Selwyn claimed the latter had benefited from a move by the present military regime towards a less racially segregated societal system.

“The regime’s goal is to legislate and enforce a new constitution which will remove political protections for Fiji’s indigenous peoples and stamp out so-called corrupt practice by Fiji’s former power-elite. It appears many Fijians, subscribing to both ethnic groups, support Bainimarama’s plan,” he said. “Also, due to staunch censorship decrees enforced in post-coup Fiji it is difficult to analyse a statistically accurate poll of public opinion.”

However, 36 Parallel Assessments, in its research, said that what support the current government did have among its people and international partners could well be dented by a failure to adhere to the 2014 election timetable.

In terms of the immediate future for Fiji, the nation still remains suspended from the Commonwealth, a decision that will be maintained until scheduled democratic elections are held in 2014.

However, Selwyn said that in terms of the Commonwealth’s success or failure in resolving the country’s political upheavals, it was important to look at the organisation’s work within the wider international community.

“The Commonwealth’s demand that Fiji must return to democracy has not set it apart as the stand-alone entity that will cause Fiji to return to democracy. Rather it is a voice among numerous bodies that are pressing the argument,” Manning said.

“It is the cumulative voice that has caused Fiji to take notice and to express a willingness to hold elections in 2014 post establishing a new constitution,” he added. “Should Fiji’s prime minister Commodore Bainimarama be elected as leader in 2014, then he will have pulled off a political coup, South-Pacific style. And that is a tempting proposition for an isolated military man to ponder.”

Maldives and CMAG

The Maldives has already been suspended from Commonwealth’s human rights and democracy arm, the Commonwealth Ministerial Action Group (CMAG). However, Commonwealth Secretariat Spokesperson Richard Uku cautioned against comparing the Maldives against a former member state like Fiji.

“Each country situation that CMAG has considered in the past has had its own particular characteristics. It would not be fair to compare one situation against the other,” Uku said.

As one of the more active elements of the international community in the Maldives following the controversial events of February 7, the Commonwealth has become a bellweather for the response of the wider international community.

The European Union told Minivan News last week that it continued to back CMAG and its Special Envoy Sir Donald Mckinnon in pursuing early elections, and an independent inquiry into the transfer of power that saw President Mohamed Waheed brought to office amid violent demonstrations, an assault on Male’s military base by mutinying police, and the storming of the state broadcaster.

While the Commonwealth has been criticised by Maldivian politicians associated with the new government, Secretariat Spokesperson Uku claimed the organisation’s experience had shown that no member state wished to be placed in such a situation as to be suspended from the group.

“Commonwealth membership carries political, economic and social benefits for member states and is valued by our member states. It also carries obligations about adhering to certain fundamental political values,” he said.

“Suspension from the councils of the Commonwealth has practical ramifications in terms of a member state being excluded from official Commonwealth meetings at various levels and being barred from receiving new technical assistance in many areas.”

Following its most recent meeting on April 16, Commonwealth Ministerial Action Group (GMAG) warned of  “stronger measures” against the Maldives if conditions regarding the independence of Dr Waheed’s Commission of Independent Inquiry (CNI) were not met. Some MPs aligned with the government subsequently called for the Maldives to preemptively disassociate itself from the Commonwealth.

State Minister for Foreign Affairs and daughter of former President Gayoom, Dunya Maumoon,  meanwhile accused the organisation of showing “bias” against the new President in its calls for early elections, claiming it had been misinformed. President’s Office Spokesperson Abbas Adil Riza said last week that the Maldives was committed to remaining a Commonwealth Member, but “only under the regulations of our constitution”.

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