It seems like a small story -- local politics in an island nation at the edge of the map. But it is typical of the sort of dynamics that are seriously undermining western security in a critical period, and in a geostrategic location.
This particular story started over a year ago, in the Kingdom of Tonga. Tonga, like many of the independent states in the South Pacific is increasingly strategic. It is being heavily courted by a new wave of powers, including China and the Arab League. However, its natural inclination is to be pro-West. And, just over a year ago, Tonga made a peaceful shift from a near-absolute monarchy to a more democratic form of government. The Australian and New Zealand governments gave money to the Tongan government for activities related to the transition.
After the elections, the Tongan Auditor General (AG) found that around $250,000 of the donor money could not be accounted for. Unusually, the money had been transferred from Treasury to the Prime Minister's Office (PMO), where bookkeeping was not as rigorous. He made recommendations to rectify the situation.
So far so good. Tonga's system of checks and balances was working. And then New Zealand got involved.
While many, if not most, donor countries use aid for political ends, New Zealand's aid is actually managed out of its Foreign Affairs ministry, blurring the line between aid and foreign policy to extinction.
The NZ Minister for Foreign Affairs, Hon. Murray McCully, had good relations with the Tongan Prime Minister at the time, and the Tongan Prime Minister's Economic Advisor, Rob Solomon, was a New Zealander whose consulting firm had done extensive work for NZAID over the last decade. A proper investigation, no matter the outcome, may have proven embarrassing for NZ as, given its close ties to the PMO, it should have at least been aware of any problematic issues as they developed.
New Zealand engaged damage control mode. It had its own audit done, however it was far from comprehensive. Reportedly, the audit was limited in scope, with the auditors themselves writing, "our review can not be relied upon to detect every instance of fraud." Not surprisingly, it didn't find any fraud. However, it did find that about $118,000 could not be accounted for. McCully stated: "The issues have arisen due to poor record-keeping rather than anything more suspicious." Regardless, NZ then asked for the missing money to be returned.
In essence, on one hand NZ was saying, 'there is nothing to see here, move on.' But on the other, it was saying, 'give us our money back,' presumably because something went wrong. Mixed messages, to say the least.
The Tongan Auditor General (AG) gave an interview in Tongan in which he said that McCully "has a 'face' towards the New Zealand public. And he has a 'face' towards us here in Tonga." Somehow, that ended up in the English press as the AG calling McCully "two-faced."
That quote seemingly drove sensitive New Zealand apoplectic.
NZ put pressure on the Tongan Prime Minister via the NZ High Commissioner. An emergency session of the Tongan parliament was convened, and parliament debated the issue for days.
On February 6th, in the Tongan Parliament, a deeply concerned Prime Minister said that the NZ government, through the NZ High Commission in Tonga, had conveyed that it was unhappy with what the AG had allegedly said in the media, and it had ruined diplomatic relations. He added that other countries might withhold aid due to the NZ situation.
The Speaker of the House had already apologized, but NZ wanted more. Apart from issuing more apologies, Parliament decided to convene a select committee to preside over a motion to dismiss the AG for misconduct.
In summary, the Tongan AG finds funds missing. NZ undermines the report. The AG makes a mundane comment about a politician showing different sides to different constituencies. Rather than accepting that freedom of speech is an intrinsic part of a healthy body politic, NZ goes into overdrive, tying up the Tongan government for days, at a time when it has other pressing issues to discuss, including an audit of a multimillion-dollar loan from China.
NZ puts pressure on the Tongan Prime Minister to extract abject apologies from the new Tongan government (which was not in power when the funds went missing), get the AG punished and, as an added touch, NZ asks for its money back. All the while creating the impression that it is the Tongans who are incompetent and corrupt.
This is how, bit by bit, the West is losing the Pacific. For short-term political ends, and what looks like personal pique, NZ is undermining an independent nation's system of checks and balances, and right to free speech, while seemingly threatening to withdraw aid if bruised NZ egos are not salved.
New Zealand thinks of itself as a big player in the Pacific. And with President Obama's vision of a "Pacific Century," little New Zealand, with a population of just over 4 million (or about the population of Kentucky), is hoping to find itself increasingly geostrategically important. So far, New Zealand's pitch has worked in DC. A 2010 scene-setter for Hilary Clinton read:
The United States continues to draw on New Zealand's deep experience and unique connection with the Pacific Island region. New Zealand has a strong leadership role in the South Pacific and views itself as having a special connection with the island nations.
NZ has partially justifyied that leadership role through aid. What Tonga hasn't realized is that, to be politically relevant to Washington, NZ needs to give Tonga aid much more than Tonga needs it.
Additionally, were NZ to withdraw aid, that would just leave the field clear for China and others to pick up influence at a cut rate, as has happened in Fiji.
So what does did this episode teach Tonga?
- A century of good relations can be wrecked if a Tongan dares to say the wrong thing and is not punished for it (i.e. NZ is a fickle ally).
- Along with aid comes the right to make political demands (China, one of the biggest lenders in the Pacific, would certainly like Tonga, and other Pacific nations, to internalize this).
- Domestic checks and balances can be overridden if politically inconvenient to outside powers that have financial links to the country (again, benefits China, which is one of Tonga's biggest creditors).
Beijing should send Wellington a thank you note.
New Zealand's demand for kowtowing undermines the stability of Tonga, and leaves it more vulnerable to the increasingly dominant regional outside influence -- which is not Wellington, but Beijing. When we weaken our allies, we weaken ourselves.
These sorts of juvenile shenanigans are being repeated all over the Pacific. They damage the region politically and economically. And, ultimately, undermine western credibility as the logical long-term economic, political and strategic ally for Pacific states.
President Obama can talk about a "Pacific Century," but unless policies in the region change, that century will belong to China.