Fiji troubles could hurt region: report

Once the jewel of the South Pacific, political and economic trouble in Fiji could
mean bad news for the whole region, a new report says.
The federal government has been warning that the political turmoil in Fiji is taking
its toll on the economy and, as a result, hurting ordinary Fijians.
But in a policy brief for the Lowy Institute for International Policy, released on
Thursday, Susan Hayward-Jones says the implications of Fiji's economic decline could
be much more widespread.
"Fiji's political crisis is indeed grave, but the economic crisis already hurting
Fiji citizens also has serious implications for the Pacific Islands region and
therefore Australia," the policy brief says.
"The full effects of the global financial crisis on the region are yet to be
realised and the ripple effect of the deterioration of the Fiji economy on the wider
region is difficult to predict with accuracy.
"However, Fiji's importance as a regional economic hub means what happens in Fiji
matters to the region."
Fiji has been widely condemned after the military leadership of Commodore Frank
Bainimarama was given greater powers just days after the Court of Appeal ruled his
government was illegal.
In the wash-up from the court ruling, President Josefa Iloilo scrapped the
constitution, sacked the judiciary and reappointed Cmdre Bainimarama until 2014.
Observers have warned the situation could mean tourism, one of Fiji's biggest income
earners, will plummet and the European Union is already hedging on a deal that could
have saved the island's important sugar industry.
In order to stave off further economic deterioration, Ms Hayward-Jones recommends
Australia, which is holding the Pacific Islands Forum leaders' summit in Cairns in
August, work on ways to deliver finance to Fiji despite the political upheaval.
Failure to act on the political problems may also mean it becomes necessary for
Australia to take a more interventionist approach in the future, says Ms
Hayward-Jones, citing the situation in the Solomon Islands.
Since 2003, Australia has led the international Regional Assistance Mission to
Solomon Islands (RAMSI) aimed at maintaining peace and stability in the island
nation.
In her policy brief, Ms Hayward-Jones notes that earlier intervention by Australia
in the Solomons may have made such a major response unnecessary.
"The delay in developing an appropriate response while the situation deteriorated
and law and order broke down completely meant the policy response required and
eventual implemented became much more complex and expensive, costing the government
over $1 billion in expenditure on RAMSI," the brief says.