VZCZCXRO7395
PP RUEHPB
DE RUEHSV #0055/01 0452259
ZNY CCCCC ZZH
P 142259Z FEB 06
FM AMEMBASSY SUVA
TO RUEHC/SECSTATE WASHDC PRIORITY 2895
INFO RUEHBJ/AMEMBASSY BEIJING 0172
RUEHBY/AMEMBASSY CANBERRA 1136
RUEHPB/AMEMBASSY PORT MORESBY 0765
RUEHKO/AMEMBASSY TOKYO 0082
RUEHWL/AMEMBASSY WELLINGTON 0931
RUEAIIA/CIA WASHDC
RHHJJAA/JICPAC HONOLULU HI
RHHMUNA/HQ USPACOM HONOLULU HI
RUEHIN/AIT TAIPEI 0138

C O N F I D E N T I A L SECTION 01 OF 03 SUVA 000055 
 
SIPDIS 
 
SIPDIS 
 
FOR EAP/ANP AND EAP/CM 
STATE PASS USTR 
 
E.O. 12958: DECL: 02/08/2016 
TAGS: PREL EAID ETRD EFIS ECIN CH FJ PP TW
SUBJECT: PLANS FOR PRC-SPONSORED CONFERENCE, ECONOMIC 
COOPERATION DOCUMENT STIR CONTROVERSY IN THE PACIFIC 
 
REF: A. SUVA 021 
     ¶B. 05 PORT MORESBY 388 
 
Classified By: Ambassador Larry Dinger Per 1.4 (B) and (D) 
 
¶1.  (C)  Summary.  The PRC has launched an ambitious, high 
profile outreach to the Pacific Island nations through a 
large-scale regional development conference and trade fair it 
is sponsoring in Fiji April 5-6.  Premier Wen Jiabao will 
come to Fiji to open the conference, to which Ministers (and 
some heads of state) from all sixteen Pacific Island Forum 
(PIF) members are being invited through the auspices of the 
PIF Secretariat.  In addition, the PRC hopes all Pacific 
states with which it has diplomatic relations will initial a 
draft "Guiding Framework" on China-Pacific Island economic 
cooperation prior to the conference.  Four countries, Fiji, 
Tonga, Cook Islands, and Samoa, have already agreed to do so. 
 According to its High Commissioner in Fiji, Papua New 
Guinea, the current chair of the PIF, has not initialed 
because it believes many aspects of the Framework should be 
handled via bilateral agreements.  Papua New Guinea 
circulated an alternate, and far more general, text to PIF 
members in late January, but the PRC continues to press in 
favor of its original proposal.  Because of concerns about 
the Framework and China/Taiwan sensibilities, the PIF 
Secretariat has decided not to co-host the regional 
 
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development conference as originally planned.  Instead, China 
and Fiji will co-host.  In response to the PRC-sponsored 
conference, Taiwan is organizing a separate conference later 
this year in Palau.  The regional conference and Wen's visit 
indicate that China is pressing to increase its role and 
influence in the Pacific.  End Summary. 
 
A Very Ambitious Economic Cooperation Proposal 
--------------------------------------------- - 
 
¶2.  (C)  Embassy has obtained from the Australian High 
Commission in Suva copies of a PRC-drafted economic 
cooperation document the Pacific Island Forum (PIF) 
Secretariat circulated to PIF member countries in November, 
 
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along with some proposed revisions drafted by the PIF.  We 
have also obtained a counter-proposal circulated by PIF Chair 
Papua New Guinea in late January.  Embassy will fax and 
e-mail these documents to EAP/ANP.  The PRC-drafted "Guiding 
Framework" for China-Pacific Island cooperation is a very 
ambitious document.  It calls for increased numbers of 
high-level visits and exchanges between China and the Pacific 
countries.  It envisions enhanced cooperation between China 
and Pacific Island states in trade, investment, agriculture, 
fisheries, tourism, transportation, finance, infrastructure 
development, natural resources, and human resource 
development.  The document suggests that China and the 
Pacific Island states should coordinate positions, wherever 
possible, in the WTO and other multilateral trade fora and 
"actively implement bilateral trade agreements."  It calls 
for the signing of bilateral investment and taxation 
agreements.  Finally, the draft document seeks to promote 
PRC-Pacific Island joint ventures in agriculture, fisheries, 
tourism, financial services, etc.  The PRC has proposed that 
all PIF members with which it has diplomatic relations 
initial the draft Guiding Framework in conjunction with the 
Beijing-sponsored "China-Pacific Island Countries Economic 
Development and Cooperation Forum Ministerial Conference 
2006" to be held in Nadi, Fiji April 5-6.  Premier Wen Jiabao 
will open the conference as part of his state visit to Fiji 
(Ref A). 
 
Fiji, Tonga, Samoa, Cook Islands Initial Document 
--------------------------------------------- ---- 
 
¶3.  (C)  Isikeli Mataitoga, CEO of the Fiji Ministry of 
Foreign Affairs, told the Ambassador and visiting EAP/ANP 
Director Krawitz February 14 that Fiji will co-host the 
Conference in Nadi, and will initial the PRC-drafted Guiding 
Framework text.  The Australian High Commissioner in Fiji, 
Jennifer Rawson, reports that Fiji MFA declined to initial 
the document on its own authority and passed it to the 
Cabinet for a decision.  The Papua New Guinea High 
Commissioner to Fiji, Peter Eafeare (protect), told us he was 
aware of three other countries that had initialed the text - 
 
SUVA 00000055  002 OF 003 
 
 
Tonga, Samoa, and Cook Islands.  Rawson and New Zealand High 
Commissioner Michael Green have informed us that Australia 
and New Zealand will not initial the text, and have not 
decided whether to attend the conference. 
 
Fiji Downplays "Guiding Framework," Says Wen Visit is Key 
--------------------------------------------- ------------ 
 
¶4.  (C)  Mataitoga insisted to us that initialing the 
framework document was no problem for Fiji, "since it's a 
nothing document" that gives leaders and ministers something 
to announce at the April conference.  It has no legal 
standing and says little of real substance.  Mataitoga 
suggested that follow-on steps China might take after the 
April conference are far more worrisome, such as trying to 
convince Pacific countries to use the Guiding Framework as a 
basis for developing a full-fledged economic cooperation 
agreement with Pacific states.  Fiji MFA has already sent the 
PRC a proposal for a bilateral "Economic Partnership 
Agreement" it hopes will help forestall any notion that Fiji 
would be involved in a broad China-Pacific arrangement. 
(Comment:  We disagree with the characterization of the 
Guiding Framework as a "nothing document."  While 
non-binding, the document is quite ambitious in scope and 
will signal governments' intent to engage in cooperation 
activities with China.   Moreover, as Mataitoga noted, the 
PRC may attempt to use the document as a starting point for 
negotiating future MOUs or agreements.  End comment.) 
 
¶5.  (C)  Joji Kotobalavu, CEO of the Fiji Prime Minister's 
Office, also expressed some skepticism about the "Guiding 
Framework," stating that the Pacific has been afflicted with 
"too many MOUs and too little follow up."   Kotobalavu 
admitted the conference is causing "difficulties" for the 
Government of Fiji, and said the Ministry of Foreign Affairs 
"has been roped into" co-hosting the event in Nadi.  He hopes 
the conference and the "Guiding Framework" will not merely 
reflect the competing interests of China and Taiwan in the 
Pacific, but will help generate real economic links between 
China and the region.  Kotobalavu said the conference takes a 
backseat, in Fiji's view, to the visit of Premier Wen, which 
will underline Fiji's commitment to a one-China policy and 
reflects the reality that China is now a very big player in 
the Pacific.  It can only be ignored at one's peril. 
 
PNG Seeks Alternatives to PRC-drafted MOU, 
But PRC Keeps the Pressure On 
------------------------------------------ 
 
¶6.  (C)  PNG High Commissioner Eafeare told us February 9 and 
again on February 13 that he hopes a revised, and far more 
general, alternative "Framework Agreement" put forward by PNG 
as PIF Chair will replace the PRC-drafted document at the 
April conference.  The PRC-drafted Guiding Framework, he 
said, covers many areas of cooperation that should be handled 
bilaterally, not in a regional forum.  The Guiding Framework 
is also divisive, he said, in that it treats some PIF members 
(those who recognize the PRC) differently than others (those 
that recognize Taiwan).  Eafeare said PIF members have 
requested that the PRC review the three documents now 
circulating - the original PRC text, the PRC text with PIF 
amendments, and the PNG text - and present its views for 
consideration by PIF members.  To date, said Eafeare, the PRC 
has not responded. 
 
¶7. (C)   According to Eafeare, the PRC has stepped up its 
efforts to get PNG to initial the PRC text in recent weeks. 
The PRC also hopes Prime Minister Somare will attend the Nadi 
conference.  The PRC has offered to pay airfare and all 
expenses for the PM, four PNG ministers, and other delegation 
members to attend.  It is offering to pay for only one 
minister plus an additional invitee for most other 
participants.  Eafeare said he has advised his government 
that "under no circumstances" should the PNG initial the text 
or have the PM accept the invitation to what is, after all, a 
ministerial-level conference.  Eafeare noted, however, that 
PNG's Ambassador to Beijing has been lobbying Port Moresby to 
accept the Chinese invitation.  (Comment: In light of Fiji's 
decision to initial the PRC-drafted text, we would expect the 
PRC to step up the pressure on PNG and other Pacific states 
 
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with which Beijing has diplomatic relations to sign on.  End 
Comment.) 
 
PIF Secretariat Hopes to Distance Itself 
From Conference and "Guiding Framework" 
---------------------------------------- 
 
¶8.  (C)  Andie Fong Toy, Director of the Political, 
International and Legal Affairs Division of the PIF 
Secretariat, said the PRC-drafted Guiding Framework is 
 
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problematic for the PIF.  The draft is far more detailed and 
ambitious than a typical regional MOU, she said, and the 
document's calls for region-wide cooperation in agriculture 
and fisheries would be difficult for some countries to 
accept.  The revised text circulated by PNG, on the other 
hand, assumes issues such as investment, taxation, tourism, 
and fisheries will be handled via bilateral agreements.  Fong 
Toy said the PRC has told the Secretariat that since the 
Guiding Framework is non-binding and has no legal standing, 
it should not be viewed with concern by the Secretariat or by 
countries unwilling or ineligible to sign it. 
 
¶9. (C)  Like Eafeare, Fong Toy believes the PRC draft is an 
attempt by the PRC to divide PIF members, several of which 
have diplomatic relations with Taiwan.  The PIF Secretariat 
decided not to co-host the regional development conference in 
April, she said, but did agree to send conference invitations 
to PIF members that do not have relations with the PRC 
(Kiribati, Nauru, Tuvalu, the Solomon Islands, Palau, and the 
Marshall Islands).  She doubted if any of those countries 
would attend the conference, since Taiwan is sure to urge 
them not to.  Fong Toy's comments echoed those of Greg Urwin, 
Secretary General of the PIF Secretariat, who told visiting 
 
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Congressional Staffer Christopher Topik on January 25 the 
Secretariat hopes to distance itself from the regional 
 
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conference because it has become too politicized. 
 
Taiwan Gets Into the Act - Plans its Own Regional Conference 
--------------------------------------------- --------------- 
 
¶10.  (C)  Ludwig Keke, the Nauru High Commissioner to Fiji, 
told the Ambassador and Krawitz that Taiwan was very unhappy 
with the PIF Secretariat for helping to facilitate the 
conference through circulating draft texts, sending out 
invitation circulars, etc.  In Taiwan's view, he said, the 
PIF Secretariat should not be involved in any aspect of the 
conference.  Mack Kaminaga, Ambassador of the Republic of 
Marshall Islands to Fiji, said he had been instructed by his 
government (which has diplomatic relations with Taiwan) "not 
to even think about" attending the conference.   Australian 
High Commissioner Rawson noted that, predictably, Taiwan is 
now organizing its own conference, tentatively planned for 
Palau in July.  Taiwan has asked the PIF Secretariat to 
"facilitate" its conference by sending invitations to all PIF 
members, just as the Secretariat is doing for the 
PRC-sponsored conference.   Foreign Ministry CEO Mataitoga 
also mentioned the planned Taiwan-sponsored conference in 
Palau during his meeting with the Ambassador and Krawitz 
February 14. 
 
Comment:  This Is Not Just About Taiwan 
--------------------------------------- 
 
¶11.  (C)  China's gamesmanship with Taiwan is certainly one 
key aspect of the April conference and the planned visit by 
Premier Wen, but it forms only part of the picture.  The 
conference will be significant both for the high-level and 
the breadth of expected Chinese representation, with hundreds 
of Chinese officials and businessmen expected to attend. 
China clearly believes it should play a prominent role in the 
Pacific region and is acting accordingly, through trade, aid, 
and high-level visits.  End comment. 
 
¶12.  (U)  This message was coordinated with, and cleared by 
Embassy Port Moresby. 
 
DINGER