"THERE GOES THE NEIGBORHOOD": NZ MEDIA SURVEY REGIONAL

UNCLAS SECTION 01 OF 06 WELLINGTON 000478

SIPDIS

SIPDIS

STATE FOR EAP/PD-AGRIMES, EAP/P-K BAILES, EAP/ANP-DRICCI, INR/R/MR

E.O. 12985: N/A
TAGS: OTRA KIRC OIIP KPAO KMDR OPRC NZ
SUBJECT: "THERE GOES THE NEIGBORHOOD": NZ MEDIA SURVEY REGIONAL
SECURITY.


1. SUMMARY: The following is a digest of recent regional security
reports in the New Zealand media. This cable gives a synopsis of
media reporting on sixteen countries in the region, their outline of
New Zealand contributions to each of those countries, and/or their
assessment of each country's future prospects. The articles cited
are:

A. "Island Propping: NZ bilateral aid in the Pacific and East Timor
2005/6" by Geoff Cumming in the 06/10/06 New Zealand Herald and

B. "There goes the neighborhood" by Michael Field in the 06/10/06
Dominion Post: END SUMMARY.


2. COOK ISLANDS:
From New Zealand Herald:

NZ BILATERAL AID TO: COOK ISLANDS: $6.2M
Focus on economic and social development, particularly outer
islands. $2.47m for education including implementing new curriculum,
graded readers to improve literacy, school refurbishment and
training.
Governance advice to NGOs, public sector
Small business development
Health specialist visits
$10 million over next 3 years for cyclone recovery.
$6 million, three-year program in outer islands for infrastructure,
including water and power, harbors, runways, markets, cyclone
shelters.
$5 million over five years for sustainable fisheries management.


3. EAST TIMOR:
From Dominion Post:

POPULATION: 1 million.

SUMMARY: In the wake of the 1975 "Carnation revolution," Portugal
fled Timor, leaving it to the mercy of Indonesia's army. After the
Timorese voted for independence, a bloodbath followed, led by
army-organized, anti-independence militias. They destroyed the
infrastructure, leading to the Australian-led peacekeeping troops of
the International Force for East Timor. On May 20, 2002, East Timor
became independent, but having a flag and a national anthem is not
all there is to building a nation.

GOVERNMENT: Disintegrating.

MILITARY AND POLICE: Local army and police at war with one another;
Anzac, Malaysian and Portuguese forces patrolling. Can the
Indonesian army be far behind?

SAFETY: Armed gangs and militia are a constant worry. Foreigners
leaving; soldiers going in.

INVESTMENT POTENTIAL: Known to have vast reserves of oil in the
Timor Gap-but Australia has taken most of it.

NZ CRISIS INVOLEMENT: Military, Police and aid. New Zealand blood
spilt.

RISK: High.

From New Zealand Herald:
NZ BILATERAL AID TO: EAST TIMOR: $4.1 MILLION
Focus on education, community development, governance and
capacity-building in public service.
Education, including study awards, English language training.
Governance, including training, human rights action plan, law and
order, technical advice, funding for UN volunteers.
Rural development funding
$500,000 for essential services.


4. FIJI:
From Dominion Post:

POPULATION: 906,000

SUMMARY: Fiji's stability depends on the Iraq War. Hundreds of
ex-soldiers work as mercenaries and their remittances, about $275
million a year, come a narrow second to tourism as Fiji's top
earner. If peace breaks out, Fiji faces an army of unemployed
mercenaries coming home. Prime Minister Laisnia Qarase has a White
Paper coming soon that will slash the military forces-- another East
Timor situation? Military commander Voreqe Bainimarama has
threatened to bring down the government.

GOVERNMENT: An indigenous-Indian coalition cabinet offers hope.

MILITARY AND POLICE: Since Sitiveni Rabuka's 1987 coups the
10,000-strong military has been a potential threat. Poorly paid
police are under-equipped.

SAFETY: Growing violent crime, especially in tourist areas.

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INVESTMENT POTENTIAL: Rich in natural resources, but customary land
issues and politics are a downside.

NZ CRISIS INVOLVMENT: Too risky to send the military; political
jaw-jaw is only option.

RISK: Moderate.

From New Zealand Herald:
NZ BILATERAL AID TO: FIJI: $6M
Five-year program focuses on governance, squatters, poverty.
Education, including teacher training, books, mobile pre-school.
Governance/civil society including funding for legislative reviews,
Fiji Human Rights Commission, Women's Crisis Centers.
Housing in squatter settlements.
Rural initiatives including bee- keeping, fishing, small-scale
horticulture and goat-farming.
NZ hospital treatment funding


5. FRENCH PACIFIC TERRORITORIES:
From New Zealand Herald:

NZ BILATERAL AID TO: FRENCH PACIFIC TERRITORIES: $625,000.
Mainly for training, in New Caledonia, Wallis and Futuna and French
Polynesia


6. KIRIBATI:
From Dominion Post:

POPULATION: 105,000.

SUMMARY: Kiribati is the scene of a strange power struggle between
China and Taiwan. A similar tiff was behind the burning of Honiara's
Chinatown.

GOVERNMENT: Brothers Anote and Harry Tong are respectively the
pro-Taiwan president and pro-China leader of the opposition.

MILITARY AND POLICE: Britain offered Kiribati an army; founding
President Iremia Tabai said no thanks.

SAFETY: Boredom and isolation.

INVESTMENT POTENTIAL: None.

NZ CRISIS INVOLEMENT: Beyond our range.

RISK: Low.

From New Zealand Herald:
NZ BILATERAL AID TO KIRIBATI: $3.1M
Education including $1.4 million for university scholarships.
Public sector and legal assistance.
$100,000 for NZ hospital treatment.


7. MICRONESIA:
From New Zealand Herald:
NZ BILATERAL AID TO MICRONESIA: $500,000.
Mainly for training, in Federated States of Micronesia, Marshall
Islands and Palau.
An additional $31.7 million was spent on regional projects in the
Pacific in 2004/05.


8. NAURU:
From Dominion Post:

POPULATION: 13,000
.
SUMMARY: For a 21-square kilometer wasteland in the middle of the
central Pacific, Nauru causes a surprising degree of international
worry. It once sold passports to anyone and played a role as the
Russian mafia's banker-- 450 off-shore banks registered to a single
government postbox. Now bankrupt, the island's risk factor is in
keeping it clear of wild schemes.

GOVERNMENT: Unstable-in 2003 it had six changes of president-but a
new reform band is slowing getting the upper hand.

MILITARY AND POLICE: None.

SAFETY: Among the world's sickest people with diabetes, heart
failure and alcoholism rampant.

INVESTMENT POTENTIAL: Australia and New Zealand have already taken
all its phosphate.

NZ CRISIS INVOLEMENT: Unlikely.

RISK: Low, but keep a watch.

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9. NIUE:
From Dominion Post:

POPULATION: Something of a mystery, but around 1000, depending on
how many fly in and out on the weekly plane paid for with New
Zealand aid.

SUMMARY: Premier Young Vivian, who till recently was talking about
turning the island into an organic farming paradise, signed a deal
in May for a fleet of Malaysian logging bulldozers to clear-fell
most of the timber on the island, which is slightly smaller than
Great Barrier.

GOVERNMENT: With a 20-seat assembly, Niue has more MPs per capita
than any other country.

MILITARY AND POLICE: Little more than an occasional RNZAF base.

SAFETY: Two murders in about 50 years-- one of them was the New
Zealand high commissioner in 1953.

INVESTMENT POTENTIAL: Very little.

NZ CRISIS INVOLEMENT: A colony in all but name.

RISK: Low.

From New Zealand Herald:
NZ BILATERAL AID TO: NIUE: $18.5M (Niue's status as self-governing
in free association with NZ means we are constitutionally obliged to
provide economic and administrative assistance).
$20m over five years for economic development and infrastructure.
$7.5 million to Niue Government trust fund in 2004/05.
$270,000 for air service maintenance and tourism.
$340,000 for vanilla farming
Education support including teacher development, teaching resources,
tertiary scholarships.
Cyclone Heta recovery.


10. PAPUA NEW GUINEA:
From Dominion Post:

POPULATION: 5.7 million.

SUMMARY: By all objective measures, PNG is a failed state.
Everything is collapsing, form the government to education and
health. Australia has unsuccessfully tried, with its "Enhanced
Cooperation Programme", to restore order. Intervention on a vast
scale is a possibility.

GOVERNMENT: With a general election next year, aging Prime Minister
Sir Michael Somare is in survival mode; good governance is off the
agenda.

MILITARY AND POLICE: Both the defense force and police are poorly
paid and resourced and suffer low morale. In the Sandline mutiny of
1998, the army brought down the government.

SAFETY: Spectacularly dangerous crime, driven by unrelenting
poverty, Aids, malaria, tuberculosis and natural disasters, make PNG
highly risky on a normal day.

INVESTMENT POTENTIAL: High returns for high risk.

NZ CRISIS INVOLEMENT: Its troubles threaten to overwhelm New
Zealand's military resources.

RISK: High to extreme.

From New Zealand Herald:
NZ BILATERAL AID TO: PAPUA NEW GUINEA (INCLUDES BOUGAINVILLE):
$13.5M
Country strategy focuses on maternal and child health, education,
rural economic development, governance and civil society. NZ also
has coordinating role in health.
HIV/Aids programs
Education including indigenous school journal project, training,
teacher development.
Fresh Produce Development Agency.
Rural economic development project in Huon Gulf.
BOUGAINVILLE
Teacher development funding.
Law and justice programs.
Community policing project.
NGO support.
Governance and Implementation Fund.
Leprosy Mission funding


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11. SAMOA:
From New Zealand Herald:
NZ BILATERAL AID TO: SAMOA: $8.2M
Development strategy focuses on strengthened private sector,
agriculture, tourism, community development, student learning and
health.
$2.8 million for tertiary scholarships.
Teacher training.
Small business development.
$5m over five years on public sector programs.
Visiting health specialists.


12. SOLOMON ISLANDS:
From Dominion Post:

POPULATION: 552,000

SUMMARY: Its people have been at war with each other, manipulated by
dreadful political leadership. Earlier this year, the locals-led by
politicians-burnt down Chinatown, the one prosperous part of the
dusty capital of Honiara, prompting a new military intervention.
There is brewing discontent in Honiara over continued hard-edged
Australian occupation.

GOVERNMENT: Unstable and corrupt, dominated by Australian
bureaucrats.

MILITARY AND POLICE: Armed Australian and New Zealand soldiers with
local police supported by Pacific officers.

SAFETY: Malaria and crocodiles. Endemic crime, riots and looting
common. Chinese leaving, but hardened expatriates staying.

INVESTMENT POTENTIAL: Had lots of timber, but Malaysian loggers
nicked most of it. Rich in gold and fish, but in the unrest mines
and canneries were targeted. Vast palm oil plantations all ruined by
strife.

NZ CRISIS INVOLEMENT: Military, police and aid.

RISK: High, and more trouble looming.

From New Zealand Herald:
NZ BILATERAL AID TO: SOLOMON ISLANDS: $18M
$30m over three years for education programs.
Voter enrolment project pre- election.
Economic advice.
Justice/court assistance.
NGO relief funding.
Small business support.


13. TOKELAU:
From New Zealand Herald:

NZ BILATERAL AID TO: TOKELAU: $25.6M (non-self-governing territory
of NZ).
NZAID provides about 80 per cent of Tokelau revenue.
Review of shipping services.
Power project planning and implementation.
Student scholarships.
Cyclone relief.


14. TONGA:
From Dominion Post:

POPULATION: 115,000.

SUMMARY: Tonga claims to have the world's highest number of PhDs per
capita; most of them don't live there. Its major problem is the
royal family who have purloined most of the kingdom's assets. Crown
Prince Tupuoto'a is demanding $47 million for the public power
company he took. His appointed prime minister, Fred Sevele, talks of
getting a mortgage from China to pay.

GOVERNMENT: Run by corrupt royal family.

MILITARY AND POLICE: The New Zealand- and US-trained, 450 strong
Tonga Defense Services is largely a palace guard. Lightly armed, but
hundreds of original condition .303 rifles are in storage.

SAFETY: Growing crime.

INVESTMENT POTENTIAL: Any carpetbagger with a scheme-turning sea
water into natural gas or investing in Nevada insurance-is welcome.

NZ CRISIS INVOLEMENT: 42,000 Tongans live in NZ. In the event of
strife, New Zealand would have to lead any intervention.

RISK: High, after King Taufa'ahau Tupou IV (87) dies.


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From New Zealand Herald:
NZ BILATERAL AID TO: TONGA: $9.8M. Priorities include education,
health, economic development, governance, strengthening civil
society.
Tertiary scholarships, school leaver training.
NZ hospital treatment.
Water reticulation schemes in villages.
Public sector programs.
Small business and community development


15. TUVALU:
From Dominion Post:

POPULATION: 12,000.

SUMMARY: Every year, the island of Funafuti sinks 6.6 millimeters
into the Pacific. As Tuvalu sits no more than 5 meters above mean
sea-level, this suggests the country has little future. The
political leadership is looking to move to Fiji or New Zealand.

GOVERNMENT: No political parties, but regular changes in leadership.
Current Prime Minister Maatia Toafa in office since 2004.

MILITARY AND POLICE: No military and small police force.

SAFETY: Very safe.

INVESTMENT POTENTIAL: Almost nothing.

NZ CRISIS INVOLEMENT: If decisions are left too long, the New
Zealand

Navy might have to rescue the whole population in the wake of a
hurricane.

RISK: low, but watch the weather and the sea.

From New Zealand Herald:
NZ BILATERAL AID TO: TUVALU: $2.1M
Focus on economic management, education and outer island
development. Funding to rise to $16.5 million by 2007/08 under five-
year development program.
$912,000 to tertiary scholarships and vocational training.
$85,000 for NZ hospital treatment.
$350,000 for outer island development funding


16. VANUATU:
From Dominion Post:

POPULATION: 209,000.

SUMMARY: On top of tribal and island divisions, Vanuatu remains
politically and socially divided between French and English
speakers. A bewildering array of political wannabes-the deeply
suspicious Barak Sope, francophone Sege Vohor and Maxime Carlot
Kormon-swap among themselves as president and prime minister. With
high unemployment, a growing squatter population around Port Vila is
seen as a long-term security threat. Occasional riots and
disturbances break out in Vila.

GOVERNMENT: Completely unstable and corrupt.

MILITARY AND POLICE: Paramilitary Vanuatu Police Force and its
mobile wing are known to have caused more trouble for the government
than criminals.

SAFETY: Volcanoes regularly go off and shark attacks are common.
Rising crime.

INVESTMENT POTENTIAL: Not good, other than in enclave tourism. Some
fishing and agriculture.

NZ CRISIS INVOLEMENT: Watch for a replay of the Solomon Islands.

RISK: Moderate.

From New Zealand Herald:
NZ BILATERAL AID TO: VANUATU: $7.3M.
Education funding includes curriculum, resources and training.
Law and order, including NZ judge.
Public service capacity building.
Domestic violence program.
Economic development planning.


17. WEST PAPUA:
From Dominion Post:

POPULATION: 2.6 million

SUMMARY: It has all the makings of the next East Timor, except this

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time Jakarta will not let go. The huge Freeport gold and copper mine
is the largest taxpayer in Indonesia.

GOVERNMENT: Indonesia, with regular allegations of human rights
abuses and mistreatment of indigenous people.

MILITARY AND POLICE: Power rests with Indonesia's army and Kopassus
Special Forces.

SAFETY: A war zone in many places.

INVESTMENT POTENTIAL: Fabulous untapped wealth-who gets it is what
the struggle is over.

NZ CRISIS INVOLEMENT: None and politicians are keen to stay clear.

RISK: Moderate to high.

MCCORMICK