The United States is refocusing on the Asia-Pacific region to promote its national interests. Strategically, this policy must encompass the whole region, including the 16 countries that are members of the Pacific Islands Forum (PIF), U.S. territories, and associated states.

The Pacific is an important part of a sustainable U.S. strategy in the region. This grouping of countries and territories has a population of approximately 35 million and a collective gross domestic product of more than $1.1 trillion. It is a region whose people are an integral part of societies in the United States and in countries like Australia and New Zealand. The countries are exposed to transnational threats such as the impact of climate change, natural disasters, and the need to manage energy, food security, and non-communicable disease.

The region is important from a security perspective. As World War II proved, the countries that occupy strategic locations in the Pacific Ocean are critical to the security of the United States. The health and welfare of Pacific Islanders therefore matters to the United States.

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The Week That Was

• Australia, Malaysia sign free trade agreement
• New Zealand to withdraw troops from Afghanistan ahead of schedule
• CSIS cohosts Pacific Day 2012

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Looking Ahead

• Asian American and Pacific Islander Heritage Month celebration
• Pacific Islands Forum regional security meeting in Fiji
• “Down Under BBQ” at the Embassy of New Zealand

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INSTITUTIONALIZING U.S. ENGAGEMENT IN THE PACIFIC

By Ernest Z. Bower, Codirector, Pacific Partners Initiative, CSIS

The United States is refocusing on the Asia-Pacific region to promote its national interests. Strategically, this policy must encompass the whole region, including the 16 countries that are members of the Pacific Islands Forum (PIF), U.S. territories, and associated states.

The Pacific is an important part of a sustainable U.S. strategy in the region. This grouping of countries and territories has a population of approximately 35 million and a collective gross domestic product of more than $1.1 trillion. It is a region whose people are an integral part of societies in the United States and in countries like Australia and New Zealand. The countries are exposed to transnational threats such as the impact of climate change, natural disasters, and the need to manage energy, food security, and non-communicable disease.

The region is important from a security perspective. As World War II proved, the countries that occupy strategic locations in the Pacific Ocean are critical to the security of the United States. The health and welfare of Pacific Islanders therefore matters to the United States.

For the U.S. to effectively engage this widely dispersed region, trade is also important. Anchored by the larger economies of Australia and New Zealand, the region is a key source of natural resources and agricultural commodities. Both Australia and New Zealand are parties to the Trans-Pacific Partnership (TPP) free trade negotiations, but there is no real plan for bringing most of the Pacific countries into regional economic integration plans. That is an oversight that should be addressed in the short term. What many of the Pacific countries need most is good governance and a pathway to integrate with the global economy. Starting with integration within the Asia-Pacific region is an important first step.

This is a critical moment for the Pacific economies to leap ahead. The Pacific Island Forum is an important institution. It is through the PIF that the Pacific and the countries in the region will gain the critical policy mass to play a significant role in the discussion about Asia-Pacific security, trade, and the developing regional architecture that links the region together. There is a real risk that leaving the PIF out of such discussions could expose PIF member countries to the mercantile instincts of nations seeking proprietary advantages or, even worse, to neglect.

The United States has a clear interest in working with visionary members of the PIF like Australia and New Zealand. New Zealand’s foreign minister Murray McCully visited Washington recently and called for more proactive U.S. engagement in the Pacific. New Zealand’s investment in the Pacific Islands is impressive and deserves thorough consideration by U.S. policymakers.

Australian foreign minister Bob Carr also spent considerable effort during his visit to Washington in April urging the United States to focus on key issues such as climate change, the upcoming United Nation’s Rio+20 sustainable development conference, health care, and renewable energy in the Pacific.

While New Zealand and Australia are doing their part, the PIF could do more to help institutionalize U.S. engagement in the region. Steps could be taken efficiently, without incurring undue costs or requiring significant additional investment. Some key steps should include the following:

1. Create a Pacific Islands Forum Committee (PIFC). This group would consist of the PIF ambassadors or senior diplomats to the United States as well as representatives from observer countries. The PIFC could meet quarterly and discuss policy issues with key U.S. interlocutors including top administration officials, members of Congress, and leaders in the private sector. Topics for discussion could include education, infrastructure, health care, trade, maritime security and domain awareness, and food and water security.


2. Leverage policy organizations. The PIFC should leverage policy and business organizations that are willing to devote resources and focus on their countries. This includes a common commitment to have leaders, ministers, and other influential policy persons address these groups when they visit the United States to discuss not only national issues, but also Pacific regional trends and concerns. The PIFC should support the development of a U.S.-PIF Business Council, or encourage the United States-New Zealand Council and/or the Australian American Leadership Dialogue to include a Pacific focus in their charters.


3. Engage in regional architecture. The PIF should discuss ways to link to newly developing regional security and trade architecture including the East Asia Summit, ASEAN Regional Forum, ASEAN Defense Ministers’ Meeting Plus, Asia Pacific Economic Cooperation forum, and the TPP trade negotiations. The PIF should request observer status in such organizations and ask to engage in an exchange of ideas with each of these groups to enhance the focus on Pacific affairs and establish an institutional linkage that can be developed into a pathway to membership in the future.


4. Collaborate in developing information and sharing data. A major impediment to more serious and sustained policy focus on the Pacific is the dearth of easily accessible information on the region’s economies, opportunities, and policy challenges. The information could be disseminated in the United States through the PIFC and partners such as business councils, policy organizations, the U.S. government, and the media.


5. Support a congressional caucus. The PIF should encourage and support the development of an active congressional caucus focusing on U.S. interests in the Pacific, organize regular briefings on key issues, and seek support for regular congressional trips to the region by members and staff.

These are basic recommendations to help the United States deepen its new focus on Asia in the context of rebalancing its resources toward the Asia Pacific. If the PIF does not act now, an important window may be closed.

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The Week That Was

Australia

New visas attract wealthy investors and skilled labor. Australia May 25 introduced a new “significant investor visa” to attract wealthy migrants. The new visa will take effect July 1 and is available to those who can make an investment of $4.8 million in the Australian economy. It will ease other visa requirements for wealthy migrants in exchange for investment in government bonds, managed funds, or domestic companies. The government approved an “enterprise migration agreement” the same day, which makes it easier for mining companies to import skilled workers on temporary work visas.

Australia, Malaysia sign free trade agreement. Australian trade minister Craig Emerson and his Malaysian counterpart, Mustapha Mohamad, signed a free trade agreement between their two countries May 22 in Kuala Lumpur. The agreement will remove tariffs on Malaysian exports to Australia when it comes into force in January 2013. Malaysia will remove tariffs on 99 percent of Australian goods by 2020. Australia has reached similar trade agreements with the United States, Singapore, and Thailand, and both Australia and Malaysia are among the nine countries negotiating the Trans-Pacific Partnership trade agreement.

Australia ranked the happiest country in the world. The Organization for Economic Cooperation and Development (OECD) May 24 ranked Australia the happiest industrialized country in the world in its annual Better Life Index. The index ranks the 34 members of the OECD on variables including housing, jobs, health, and the environment. The OECD largely credits Australia’s top spot to its strong performance during the global economic downturn. Norway and the United States ranked a close second and third.

Qantas to cut 500 engineering jobs. Australia-based Qantas Airlines announced May 21 it will cut about 500 engineering jobs as it moves to upgrade its technological capabilities. The company has faced falling profits in the past year, particularly in its international flights division, and has been forced to cut international routes and slash about 2,000 jobs since August 2011. Qantas has weathered the global economic downturn better than other international carriers, but low demand and high fuel prices have led to shrinking profits.

New Zealand

New Zealand to withdraw troops from Afghanistan ahead of schedule. New Zealand’s foreign minister, Murray McCully, announced May 22 that his country’s remaining troops will leave Afghanistan in 2013, a year ahead of schedule. New Zealand maintains a 140-member provincial reconstruction team in Bamyan Province. McCully noted that security in that province will be handed over to Afghan troops by the end of this year, making the early withdrawal possible. His announcement follows a similar decision by Australia, which announced in April that its remaining troops will leave Afghanistan by the end of 2013.

Trade minister Tim Groser speaks in Washington. New Zealand trade minister Tim Groser visited Washington May 16–18 to meet U.S. officials, including his counterpart, U.S. Trade Representative Ron Kirk. On May 18 Groser addressed a conference organized by the Inter-American Development Bank and the International Food and Agricultural Trade Policy Council on the growing importance of food security. He also sat down May 16 with Pacific Partners Initiative codirector Ernie Bower to participate in the CSIS interview series The Dialog. The interview is available here.

Foreign, defense ministers visit the United States. New Zealand foreign minister Murray McCully and Defense Minister Jonathan Coleman led the New Zealand delegation to the 25th NATO Summit in Chicago May 20–21. McCully then traveled to Washington where he spoke May 24 at Pacific Day 2012, cohosted by the CSIS Pacific Partners Initiative, and met with U.S. secretary of state Hillary Clinton May 25. Their discussion included New Zealand’s campaign for a nonpermanent seat on the UN Security Council in 2015–2016. McCully also traveled to New York for a meeting with UN secretary-general Ban Ki-moon.

Government unveils balanced 2012 budget. The government May 24 unveiled its 2012 balanced budget, which seeks to fulfill Prime Minister John Key’s pledge to return New Zealand to a budget surplus by 2014–2015. The new budget cuts government spending, including by freezing universal subsides for early childhood education and restructuring the student loan repayment system. It also raises revenues by cutting tax credits and raising the tobacco tax. Opposition legislators derided the budget, including Labour leader David Shearer who said, “It fails to make the tough choices.”

Papua New Guinea

Supreme Court Justices charged with sedition amid constitutional crisis. Police in Papua New Guinea charged Supreme Court Chief Justice Sir Salamo Injia and Justice Nicholas Kirriwom with sedition May 24 and 29, respectively. Prime Minister Peter O’Neill brought charges against the two judges in retaliation for a May 21 Supreme Court ruling that the National Parliament’s December 2011 decision to replace former prime minister Sir Michael Somare with O’Neill was unconstitutional. The parliament responded to the new ruling May 29 by declaring the position of prime minister officially vacant and reelecting O’Neill the next day.

Parliament declares state of emergency in three provinces. Papua New Guinea’s National Parliament declared a state of emergency May 26 in three provinces—the national capital district, the Southern Highlands, and Hela Province. Prime Minister Peter O’Neill said the decree is necessary in the lead-up to national elections scheduled for June 23–July 6. The capital is in the grips of a constitutional crisis pitting the Supreme Court against the parliament and prime minister. O’Neill also said the state of emergency in the two highlands provinces is needed to protect the large Esso Highlands natural gas project, owned by ExxonMobil, which has been hampered by disputes with local landowners.

pacific Islands

CSIS cohosts Pacific Day 2012. The CSIS Pacific Partners Initiative joined the Washington Pacific Committee, a grouping of the ambassadors and representatives of the Pacific Islands in Washington, to cohost Pacific Day 2012. The event was held at the New Zealand Embassy and featured a keynote speech by New Zealand foreign minister Murray McCully, followed by a seminar with a panel of Pacific experts. The annual event is intended to raise the profile of the Asia Pacific in Washington and to celebrate Pacific cultures. More information, including videos of the event and interviews with McCully and New Zealand ambassador Mike Moore, is available here.

Japanese, U.S, Pacific Island leaders meet in Okinawa. Japanese prime minister Yoshihiko Noda hosted the 6th Pacific Island Leaders Meeting in Okinawa May 25–26. The tri-annual meeting was attended by leaders from 15 Pacific Island nations, Japan, and the United States, which was represented for the first time. The leaders discussed a range of topics, including disaster relief, sustainable development, and climate change adaptation. During the meeting, Noda pledged up to $500 million over three years in assistance to Pacific Island countries. Fiji did not attend the meeting after Japan invited its foreign minister rather than military leader Commodore Frank Bainimarama.

Fiji to issue voter identification cards for 2014 election. Fiji attorney general Aiyaz Sayed-Khaiyum said May 27 the country will issue voter identification cards for the first time ahead of elections scheduled for 2014. Sayed-Khaiyum said the cards will help minimize fraud, noting that in Fiji’s last election in 2006, one district boasted voter turnout of 101 percent. The lead-up to the 2014 election is being watched closely by Fiji’s neighbors and other interested parties who hope it will mark a return to democracy following a military coup in 2006.

Tonga to open its first solar power farm. John van Brink, general manager of state-owned Tonga Power Limited, said May 22 that the country’s first solar power farm, the Popua Solar Farm, will be operational by August. The $6.7 million project funded by the New Zealand government will generate 1,880 megawatt hours of electricity per year—about 4 percent of Tonga’s total demand. The project is part of the Tongan government’s pledge to generate 50 percent of the country’s electricity from renewable sources by the end of the year, though it is unlikely to meet that target.

Taiwan to establish Chinese language school in Solomon Islands. Solomon Islands prime minister Gordon Darcy Lilo led a delegation to Taiwan as part of a two-week Asia trip May 19–26. Lilo met with Taiwan’s president Ma Ying-jeou and congratulated him on his recent reelection. The two discussed ways to increase bilateral ties and Ma agreed to establish a Chinese language school in the Solomon Islands by the end of 2013. Taiwan is still recognized by 6 of 14 Pacific Island countries and competes for influence with China via aid and loans. After leaving Taiwan, Lilo and his delegation traveled to Japan for the Pacific Island Leaders Meeting.

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Looking Ahead

Asian American and Pacific Islander Heritage Month celebration. The Johns Hopkins University School of Advanced International Studies (SAIS) and the Washington, D.C., Mayor’s Office will cohost a celebration of Asian American and Pacific Islander Heritage Month May 31 with D.C. mayor Vincent C. Gray. The event will take place from 5:30 p.m. to 8:00 p.m. at SAIS’s Kenney Auditorium, Nitze Building, 1740 Massachusetts Ave., NW. The event will also be live webcast. Please RSVP here.

Pacific Islands Forum regional security meeting in Fiji. The Pacific Islands Forum (PIF) will hold its annual Forum Regional Security Committee (FRSC) meeting June 5–8. The meeting will bring together representatives of the 15 PIF member countries as well as various regional law enforcement agencies to discuss a range of security-related issues, including terrorism, transnational crime, and civil unrest. Representatives will prepare recommendations for the Forum Officials Committee Meeting in August. The annual meeting will be hosted by the PIF Secretariat in Suva, Fiji. More information is available here.

“Down Under BBQ” at the Embassy of New Zealand. The Australia America Association and the Southern Cross Club will host a “Down Under BBQ” June 23. The event will be held from 5:30 p.m. to 8:30 p.m. at the Embassy of New Zealand, 37 Observatory Circle, NW. For more information and to RSVP, please click here. RSVPs and payments are due by June 19.

Australian American Leadership Dialogue (AALD) July 15–18. The American Australian Education Leadership Foundations in Washington and Melbourne will host the annual Australian American Leadership Dialogue (AALD) July 15–18 in Washington. AALD is a private bipartisan diplomatic initiative that brings together leaders from both countries to explore ways to strengthen the bilateral relationship. For more information, please visit www.aald.org.

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