PRC VICE PRESIDENT XI'S VISIT TO FIJI

C O N F I D E N T I A L SECTION 01 OF 03 SUVA 000082 SIPDIS DEPARTMENT FOR EAP/ANP E.O. 12958: DECL: 03/05/2019 TAGS: PREL EAID FJ CH SUBJECT: PRC VICE PRESIDENT XI'S VISIT TO FIJI Classified By: Richard K. Pruett, Deputy Chief of Mission. Reasons: 1. 4(b) and (d). ¶1. (SBU) Summary. The recent stop-over in Fiji of China's Vice President Xi Jinping enroute to his Latin America visits provided Beijing an opportunity to strengthen incrementally its growing economic, security, and political relationship with Suva. For Fiji's interim government (IG),the timing of the visit was optimal. Coming so soon after Fiji's censure at the Forum Special Leaders meeting in Port Moresby, the visit provided an opportune reminder that Fiji still has supportive friends, while Fiji's recently flood-stricken west provided a sympathetic backdrop to Fiji's requests for assistance. At the same time, Vice President Xi privately urged the IG to announce elections at an early date. China has shown through its ambassador to Fiji increased willingness to press for elections and criticize unnecessary diplomatic expulsions. End summary. ¶2. (SBU) With a delegation of 80 Chinese officials and businessmen, Vice President Xi Jinping of the People's Republic of China (PRC) transited Fiji February 8 and 9 on the first leg of a journey scheduled to take him to Brazil, Colombia, Jamaica, Mexico and Venezuela. An official traveling with the vice president's party told a journalist off the record that Xi is slated to become president in 2012. ¶3. (U) Josaia Voreqe Bainimarama, Fiji's interim Prime Minister who led the December 2006 military coup that overthrew Fiji's elected government, and Fiji's President Josefa Iloilo met separately with the Chinese leader during Xi's stopover in Nadi. Nadi Town, Fiji's leading tourism spot, is located on the west side of Fiji's principal island of Viti Levu and is the site of Nadi International Airport. Nadi suffered the worst flooding in memory in the second week of January as the result of torrential rains and insufficient dredging of silted rivers. The PRC had acted early to donate 50,000 Fijian dollars (approximately USD 30,000) for the relief of flood victims. ¶4. (SBU) Security for Xi's visit was tight, and the IG severely restricted reporters in their coverage of events. The meeting between Xi and reclusive President Iloilo was not carried in the press beyond a photo spray, but Embassy understands from various sources that President Iloilo requested Chinese assistance in replacing the fence around his residence. (Begin comment. Presumably the fence in question is the extensive fence surrounding his official residence at Government House in Suva. End comment.) ¶5. (SBU) The meeting between Xi and Bainimarama was also private, although the interim Prime Minister's office later released what it said was a full text of Bainimarama's speaking notes for the meeting. Bainimarama began by saying that Xi's visit is "symbolic of the close and growing relationship which Fiji and China enjoy," and noting that the date was the fifteenth day of the Chinese lunar year, "Lantern Festival," when Chinese visit relatives and special friends. Bainimarama noted that Fiji established diplomatic relations with the PRC in 1975, soon after its independence from Great Britain. Bainimarama gave Xi his take on Fiji's political situation "as there is much hype and misinformation about the political developments here." He claimed steady progress on all fronts in restoring Fiji to "true and genuine" parliamentary democracy, "the timing of which will be determined by the people of Fiji alone." (Begin comment. Bainimarama has eschewed all opportunities for genuine consultation with the people. His clear intent now is that his military leadership alone determine the timing of elections. "End comment.) ¶6. (SBU) Fiji's interim prime minister then raised a litany of trade and development issues for which he wished to thank Beijing for cooperation and/or to seek more. He noted that China always had a positive trade balance with Fiji but is committed to import more from Fiji and to encourage more direct Chinese investment in Fiji. He said his government would positively consider an Investment Protection Agreement proposed by Beijing, and he thanked the Chinese for granting Fiji approved destination status for Chinese tourism, adding that his government had relaxed entry requirements for SUVA 00000082 002 OF 003 Chinese traveling to Fiji. He also thanked Beijing for giving Air Pacific landing rights in Hong Kong, which according to local press should commence June 18, and advocated a review and updating of Fiji's Air Services Agreement with the PRC. Bainimarama gave thanks for China's increasing levels of developmental and grant-in-aid assistance, "especially in respect of the reconstruction and rehabilitation works so necessary after the recent floods." ¶7. (SBU) Near the conclusion of his prepared remarks, Bainimarama notified Xi that Fiji is in the "final stages" of accessing funding under the USD 600 million soft loan facility for Pacific island countries announced by Premier Wen Jiabao when he visited Fiji in April 2006. He said that "huge potential for further collaboration" exists between Fiji and the PRC, and "we are keen to explore possibilities through discussions that would take our current level of bilateral cooperation to new heights in the form of more intensive partnerships covering economic, trade, aid, education, social and cultural issues and other related areas." Bainimarama obliged Beijing with a statement of Fiji's commitment to "the one-China policy" and added the Fiji is "open for discussions on new possibilities for collaboration." Moments later, Bainimarama noted that Fiji had had visits from five Chinese satellite tracking vessels last year, leaving Fiji lots of foreign exchange, and hoped for at least 10 such visits this year. ¶8. (SBU) Xi's remarks were not published. He reportedly reciprocated with words of sympathy for Fiji's recent flooding and noted that Fiji was the first Pacific island country to establish diplomatic relations with China in 1975, which ushered in a new era in Fiji-PRC bilateral relations. He said that developing China-Fiji relations is "not only in the common interests of our two countries and two peoples, but also conducive to stability and development in the Asia-Pacific region." He reportedly pressed Bainimarama for early elections. Xi and Bainimarama then signed a series of agreements that reportedly included 20 million RMB in assistance for roadway and other construction. ¶9. (U) Shortly after Xi's visit, a six-person Chinese technical team visited Fiji to survey its garment manufacturing plants with a view to assess possible future Chinese assistance to Fiji's textile, clothing and footwear industries. On March 3, Fiji press announced that China Railway First Company Ltd. had signed a 70 million Fiji dollars (approximately USD 37 million) contract with Fiji's Housing Authority and Public Rental Board to construct low cost housing units in three Suva suburbs. The funding for the project is a soft loan from China's EXIM Bank at two percent interest rate over 20 years. ¶10. (C) Comment. Xi Jinping's visit to Fiji, which was not a state visit but a transit, allowed Beijing the opportunity to show a modicum of solidarity with Fiji following Bainimarama's no-show in Port Moresby. The goals of access to extractive resources, trade channels, new markets and political support (especially vis-a-vis Taiwan),are all drivers in China's policy toward Fiji, but its interests in each are eclipsed by its need to maintain productive relations with Canberra and Wellington. Premier Wen had offered China's soft loan to the Pacific island countries before the December 2006 coup that brought Bainimarama to power, but Beijing may be frustrated at the slow pace at which the IG has availed itself of the offer, especially as its assistance to Fiji under the facility would be "cloaked" by the fact that it had been offered before the coup to the entire region, not just to Fiji. Fiji's "one-China policy" appears to follow Beijing's formula that Taiwan is a province of China, of which the PRC is the sole legal government, rather than the more nuanced U.S. formula, which states that Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is a part of China. In fact, Taiwan has maintained technical assistance teams in Fiji since 1978 to help Fiji in its local agricultural and industrial development. There are recurring rumors that Beijing is seeking a seabase or satellite tracking station in Fiji, especially to replace the satellite tracking station it removed from Tarawa and returned to China for "upgrading" when Kiribati recognized Taipei in November 2003. Ambassador McGann has met with his Chinese counterpart, Ambassador Han SUVA 00000082 003 OF 003 Zhiqiang, several times to urge China to take a more proactive approach toward encouraging the IG to hold elections. The Chinese embassy privately criticized the IG for its December 2008 expulsion of New Zealand Acting High Commissioner Caroline McDonald and in a show of solidarity attended the short-notice farewell reception Ambassador McGann hosted at the Residence. Embassy will continue to nudge Chinese counterparts to support the efforts of the PIF and other partners in urging Fiji to return to democracy. MCGANN