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PP RUEHDT RUEHKN RUEHMJ RUEHPB
DE RUEHSV #0490/01 3171526
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FM AMEMBASSY SUVA
TO RUEHC/SECSTATE WASHDC PRIORITY 3432
INFO RUEHBK/AMEMBASSY BANGKOK PRIORITY 0621
RUEHBJ/AMEMBASSY BEIJING PRIORITY 0207
RUEHBY/AMEMBASSY CANBERRA PRIORITY 1358
RUEHDT/AMEMBASSY DILI PRIORITY 0004
RUEHJA/AMEMBASSY JAKARTA PRIORITY 0086
RUEHKN/AMEMBASSY KOLONIA PRIORITY 0165
RUEHMJ/AMEMBASSY MAJURO PRIORITY 0609
RUEHML/AMEMBASSY MANILA PRIORITY 0188
RUEHPB/AMEMBASSY PORT MORESBY PRIORITY 0957
RUEHUL/AMEMBASSY SEOUL PRIORITY 0077
RUEHKO/AMEMBASSY TOKYO PRIORITY 0105
RUEHWL/AMEMBASSY WELLINGTON PRIORITY 1142
RUEHIN/AIT TAIPEI PRIORITY 0167
RHHJJAA/JICPAC HONOLULU HI PRIORITY
RUEHBS/USEU BRUSSELS PRIORITY
RHHMUNA/CDR USPACOM HONOLULU HI PRIORITY

C O N F I D E N T I A L SECTION 01 OF 07 SUVA 000490 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 11/03/2031 
TAGS: AORC PREL EAID ECIN ETRD FJ XV
SUBJECT: PACIFIC ISLANDS FORUM 2006: A/S HILL UNDERSCORES 
U.S. ENGAGEMENT IN PACIFIC 
 
REF: A. SUVA 459 
     ¶B. SUVA 455 
 
Classified By: Amb. Larry Dinger.  Reasons 1.4 (b) and (d) 
 
Summary 
------- 
¶1. (C) EAP Assistant Secretary Christopher Hill emphatically 
reaffirmed U.S. commitments and interests in the Pacific at 
the 2006 Pacific Islands Forum (PIF) summit in Nadi, Fiji. 
In a new PIF-Leaders "special session" for the United States, 
Hill countered a suggestion that the U.S. has disengaged from 
the region.  Per ref A, Hill offered to organize a 
multilateral meeting in Washington on future avenues for 
economic cooperation with PIF countries under the Joint 
Commercial Commission (JCC) rubric.  He also discussed ideas 
for a possible high-level USG meeting with island leaders. 
In a two-day series of bilaterals and media opportunities, 
A/S Hill continued to stress the U.S. engagement message. 
Also on the agendas were donor coordination and transparency, 
good governance and rule of law, regional security, trade and 
economic cooperation, capacity building, environmental 
issues, potential Peace Corps programs, and the Millennium 
Challenge Account.  Hill updated Australian PM Howard and New 
Zealand PM Clark on the North Korea crisis.  In meetings with 
representatives of China, a formal PFD partner, and Taiwan, a 
PIF Secretariat donor invitee, Hill noted U.S. misgivings 
about checkbook diplomacy in competition for recognition in 
the region.  End Summary. 
 
Hill: United States Remains Engaged 
----------------------------------- 
¶2. (SBU) A/S Hill used his conversation with a dozen heads of 
PIF-member governments at the United States special session 
to counter worries among some that the U.S. is neglecting the 
Pacific.  He reconfirmed the U.S. commitment to the region, 
noting that U.S. substantive interaction via embassies and in 
a variety of regional bodies, plus continued significant 
funding through international organizations and the 
Millennium Challenge Corporation's contract with Vanuatu are 
undeniable indicators of U.S. engagement in the Pacific.  He 
cited the recent approvals of regional environmental and 
public-diplomacy hubs at Embassy Suva as further evidence. 
And he proposed further engagement through a revitalized JCC 
and possible high-level meetings in 2007.  (See ref A for 
details.) 
 
Core Donors Meeting... 
---------------------- 
¶3. (C) A/S Hill's other group session was a U.S.-hosted 
informal meeting of significant donor nations attending the 
PIF festivities.  Participation was based on a sense of which 
partners the Island States see as most important: Australia, 
China, the European Union, France, Japan, Korea, New Zealand, 
the UK, and the U.S.  PIF Secretary General Greg Urwin, who 
moderated the meeting, called on core donors to be jointly 
guided by agreed international-assistance frameworks.  He 
offered the PIF's Pacific Plan as a useful road map.  The EU 
suggested the Paris Principles, as well.  Hill proposed that 
donors emphasize the concept of community, as opposed to the 
dichotomy of givers and takers.  Hill urged the donors, 
including China whose presence and role he highlighted, to 
coordinate efforts to address governance issues.  Australia 
noted that governments find it hard to justify large amounts 
of aid "if it's going into pockets."  The EU outlined its new 
methodology for encouraging good governance by mutually 
agreed performance indicators that, if met, trigger increased 
aid flows.  New Zealand cautioned that some aid recipients 
have expectations that are not attainable.  China suggested 
it is not a major donor, though it has appointed a senior 
diplomat as Ambassador-at-Large for development assistance to 
the region.  China said fighting corruption, fostering good 
governance, and promoting the rule of law are among its 
goals, and it looks forward to cooperating with the other 
donor nations in the Pacific. 
 
SUVA 00000490  002 OF 007 
 
 
 
Regional restructuring; PFD revisions 
------------------------------------- 
4 (C) On other core-partner issues, Urwin noted that the PIF 
agreed to pursue its theme of consolidating regional 
technical agencies; however, given widespread questions about 
legal, financial, and administrative aspects of the initial 
proposal, Summit leaders have called for a task force to 
consider the various issues and report back to the 2007 
summit.  On plans to reform the PFD process, Urwin said PIF 
leaders are prepared to replace the current bilateral PFDs 
with a most-of-day plenary on one or more issues of regional 
importance.  When the Japanese expressed concern that some 
form of bilateral PFD may remain useful from time to time, 
Urwin took that on board.  He emphasized that informal 
bilaterals among nations on the margins of the PFD are 
valuable and would certainly continue. 
 
Partner session worth continuing 
-------------------------------- 
¶5. (C) Participants judged the core-donor session worth 
repeating and agreed to meet again on the margins of future 
PIF meetings.  Australia recommended that the group, perhaps 
under PIF auspices, should consider holding "structured 
meetings on key regional issues and concerns" related to 
donor coordination.  Urwin responded that thought should be 
given to scheduling such meetings at future PIF summits or 
separately, with more time and an expanded agenda. 
 
Bilateral: Australia -- Pacific issues 
--------------------------------------- 
¶6. (C) In the Australia bilat, PM John Howard briefed Hill on 
the Forum leaders' discussion of the PIF-sponsored Regional 
Assistance Mission for Solomon Islands (RAMSI).  Howard said 
PM Sogavare's emotional call for a fundamental re-think was, 
in the end, not heeded.  The debate was heated, but "when 
push came to shove, they (island leaders) still support 
RAMSI."  The group did agree to a review, but the mission 
would continue unchanged in the interim.  Howard noted more 
tension and aggression at the PIF summit this year, the 
result of push back from island leaders to Australia's 
insistence that certain conditions be met for continuing aid. 
 He acknowledged that Australia "casts a long shadow" over 
PNG and to a lesser extent the Solomons, but the disagreement 
over the flight from PNG of Solomon Islands Attorney General 
nominee Moti posed a basic rule-of-law question.  Sogavare 
needs to be encouraged to use common sense.  Hill suggested 
that is a message New Zealand might be able to deliver in 
Australia's stead.  Howard replied that Australia and New 
Zealand work well together in the Pacific, not always agreed 
on every issue but together on the important ones, such as 
the need for good governance and policies to promote economic 
growth.  He described New Zealanders as "soft Saxons, with a 
disposition to the center-left and with fewer resources" than 
Australia.  Howard said Australia is "happy to take a role" 
in the South Pacific, but Australian taxpayers expect their 
money to not be abused by those receiving it.  Howard 
described Fiji PM Qarase as "a good man doing a good job.  I 
have a lot of time for him."  Howard welcomed A/S Hill's 
presence at the Forum as a sign of U.S. interest in the 
Pacific region. 
 
Australia -- Other East Asia issues 
----------------------------------- 
¶7. (C) On East Timor, Howard said the issues are "very 
tough."  The current leadership is "the best of the ones 
there, but they need a lot of help."  He said the UN wants to 
get out too soon.  "We have all learned you can never have 
too many people on the ground."  Hill gave Howard an update 
on recent developments on North Korea.  Howard suggested 
China is "quite chastened" by the nuclear test.  It was a 
"humiliation," but in fact an "ill wind" situation.  It has 
knocked China "psychologically off balance."  As a result, 
the Chinese have never been more helpful.  He judged it 
really good that the issue has brought the U.S. and China 
 
SUVA 00000490  003 OF 007 
 
 
closer.  Howard said that Japanese-Chinese relations, prior 
to new PM Abe, had "deteriorated totally."  That was a 
problem for both Australia and the U.S.  Now there is hope 
for improvement. 
 
Bilateral: New Zealand 
---------------------- 
¶8. (C) When A/S Hill briefed PM Clark on North Korea, she 
suggested the U.S. and China are now "united" on the issue. 
She said the most difficult aspect in international diplomacy 
is: what to do with a rogue nuclear power.  Clark appreciated 
the Secretary's phone call to Foreign Minister Peters on 
North Korea, seeing it as "proactive diplomacy."    Clark 
asked the U.S. to "stick to your guns" regarding the Korea 
FTA negotiations.  She described a "soft deal" that Chile 
concluded with Korea which doesn't address agriculture and is 
"an enormous danger to New Zealand."  Clark described the 
Thai coup as "very unwelcome" and suggested it made Indonesia 
quite nervous.  She predicted the Philippines is "a stick 
away from disaster." 
 
¶9. (C) Clark thanked Hill for his "personal efforts on the 
New Zealand relationship."  When Hill noted the possibility 
of a high-level meeting with Pacific leaders, Clark suggested 
a "whistle stop" to Suva could be a good idea, and a stop in 
New Zealand would also be welcome.  Clark said New Zealand 
media would be "overwhelmingly positive."  There would be 
protesters, but that would be manageable.  She noted a Hawaii 
venue would also work.  Clark expressed appreciation for 
Hill's visit to Nadi and for the U.S. continued participation 
in the region.  She noted that "everyone else is here": 
China, Taiwan, France, Japan, the EU.  Australia and New 
Zealand are present but are "not big fish."  An example is 
Tuvalu's attitude toward whaling.  New Zealand provides $2 
million; Japan gives $20 million.  Clark said the "jug is 
half full" on the Pacific plan.  It is a response of the 
"marginalized Pacific" for the 21st Century and can help 
donors allocate their funding.  Still it gets derailed, as 
may be happening in Fiji with Commodore Bainimarama's 
activities.  On the Solomons, Clark noted that any government 
there has "dubious elements," compounded by lots of dollars 
from Taiwan.  She aspires to a clearer vision on a strategy 
and end point for that issue. 
 
Other Bilaterals 
---------------- 
¶10. (SBU) In other bilaterals, Hill highlighted the USG 
themes of continuing U.S. engagement in the Pacific; concerns 
over good government, transparency, and the rule of law; 
interest in exploring potential for economic cooperation and 
trade; and donor coordination.  For their part, senior 
leaders of Fiji, Tonga, Palau, Nauru, Tuvalu, the Federated 
States of Micronesia, the Marshall Islands, and Samoa, and 
delegation heads from the European Union, Japan, Korea, and 
China had widely varying agendas. 
 
China 
----- 
¶11. (C) Hill's meeting with Assistant Minister of Foreign 
Affairs He Yafei included discussion of North Korea, which He 
noted has "strategic import for both of us."  He assured Hill 
that "we see eye to eye on almost every issue, and there is 
nothing that cannot be solved."  He expressed thanks for 
repeated U.S. assurances on Taiwan.  China sees the Chen 
government growing increasingly "desperate and pushing the 
envelope" due to domestic troubles.  The idea of a new 
constitution is "very dangerous."  He said China's aid 
practices in the Pacific are not aimed at gaining influence 
or undermining good governance.  "Only in very exceptional 
cases" does it include cash.  In fact, China's criteria for 
aid in the region are good governance, reduced corruption, 
sustainable, long-term impacts, especially on economic 
growth, and avoidance of competition with Taiwan, which He 
accused of routinely using aid to corrupt small island 
governments.  He asked Hill for U.S. help to wean the six PIF 
 
SUVA 00000490  004 OF 007 
 
 
states that recognize Taipei away from Taiwan, saying, 
"Greater recognition of China would also serve U.S. 
interests."  He noted China has "huge (assistance) resources, 
but we don't want to go there."  Beijing's insistence that 
Hill not meet at the summit with a representative of Taiwan 
received brief mention.  (He hit on that topic more 
insistently the evening before during an informal chat.) 
Hill reminded He that U.S. policies on communicating with 
Taiwan will not change, and suggested that China should 
engage in dialogue with Taiwan and avoid humiliating it in 
international fora. 
 
Taiwan 
------ 
¶12. (C) In an informal encounter with Taiwan Vice Minister of 
Foreign Affairs, Ms. Chang Siao-Yue, Hill stressed the 
message: good governance in providing aid.  He advised Chang 
that Taiwan should avoid focusing on its "competition" with 
China in the Pacific and instead seek to "brand" Taiwan's 
development programs as an example of how to deliver honest, 
transparent, good-quality assistance.  Chang said that 
despite claims by others, including Australia, that Taiwan 
uses its aid chiefly to buy influence, it is "never our goal 
to put funds into pockets, always projects."  She said Taiwan 
doesn't have the money to compete with China for influence in 
the Pacific; and, in addition, the Taiwan legislature watches 
her ministry's activities in the Pacific very closely.  She 
accused China of attempting to woo politicians from 
Kiribati's previous government (which recognized China) in an 
attempt to shift Kiribati into Beijing's camp at some future 
date.  Chang told Hill that Taipei welcomes increased U.S. 
involvement in the Pacific.  She said Taiwan is worried that 
the United States is not paying enough attention to China's 
expansion in the region. 
 
Japan 
----- 
¶13. (SBU) Japan's "special representative" to the PIF summit, 
senior diplomat Tutsuo Arima, told Hill that bettering 
governance in the Pacific island states has become one of 
Tokyo's core objectives.  Under the recently concluded 
"Okinawa Partnership" agreement, Japan committed to spending 
some $400 million in grants over three years, aimed at 
sustainable economic growth, good governance, and security. 
Projects would be built around initiatives proposed by the 
island states, with an emphasis on host-country "ownership." 
Capacity building via the training of 4,000 civil servants 
and private sector actors, and waste-management programs, 
including electronic waste, were two key programs. 
 
Korea 
----- 
¶14. (SBU) Korea's ambassador-at-large for East Asia 
Cooperation, Cho Hee Yong, described Korea's approach to good 
governance in its dealings with Pacific states as an 
extension of its own history as a recent democracy, and its 
domestic efforts toward political transparency and 
accountability.  He congratulated Hill on his initiative to 
host a meeting of donor-partner countries on the margins of 
the summit.  Cho said Korea hopes to involve both China and 
Taiwan in donor coordination as a means to commit them to 
greater attention to good governance.  He told Hill that 
Seoul would very much like to coordinate with the United 
States on its initiatives in the Pacific, reflecting common 
strategic interests in the region.  In Cho's view, small 
investments are the best vehicle for assisting the small 
island economies. 
 
The European Union 
---------------- 
¶15. (SBU) The Deputy European Commission DG for Development 
told Hill that the EU considers this year's Forum a success. 
He cited the leaders' support for RAMSI in the face of heated 
debate as a key achievement.  On assistance issues, he said 
the EU concurs with the United States on the need to focus on 
 
SUVA 00000490  005 OF 007 
 
 
security, governance, and transparency concerns.  He added 
that it is important for China and Taiwan to emphasize good 
governance in their assistance programs, and the EU hopes the 
United States can help persuade the two competitors on this. 
 
Fiji 
---- 
¶16. (SBU) The bilat with Fiji PM Qarase, PIF Chair for the 
next year, took place immediately after the U.S. special 
session with Forum leaders.  Qarase commented that the 
session, which might serve as a prototype, exceeded the 
expectations of the PIF.  Qarase expressed enthusiasm for 
Hill's proposal to host a Joint Commercial Commission meeting 
in Washington to discuss trade issues and explore 
possibilities for expanding economic cooperation between the 
United States and the PIF member states.  Qarase said he had 
to act to rein in the Commander of the Fiji military. 
"Enough is enough."  Qarase said once that critical problem 
is resolved, "things look good for Fiji."  Hill noted a 
concern that some military figures might have drawn the wrong 
conclusion from the recent coup in Thailand.  The United 
States had cut off aid there and would do still more to 
underscore fundamental support for civil leadership.  Qarase 
remarked that the 1987 and 2000 coups had set Fiji back 50 
years, and the country could not afford a repeat.  Tourism is 
booming, he said, and such things as Fiji Water, golfer V.J. 
Singh, and the country's hosting of film productions such as 
television's "Survivor" are helping Fiji's profile in the 
world. 
 
Tonga 
----- 
¶17. (C) PM Sevele reviewed the status of the report of 
Tonga's National Committee on Political Reform (NCPR) and his 
own counter proposal.  He agrees in principle with the NCPR 
findings but not with some details.  Sevele suggested it is 
important for the stability of Tonga's transition to more 
democratic forms that the King retain some of his historic 
roles.  The King does not have to "dominate, but he must be 
part" of the leadership.  The King "prefers convention rather 
than legislation."  Sevele said he would travel to the 
Solomon Islands before the end of November as part of a PIF 
delegation intended to review RAMSI.  The delegation is to 
report to PIF ministers and make recommendations on how to 
reduce tensions.  Sevele raised Tongans' continuing 
unhappiness with having to travel at great expense to Suva to 
apply for visas.  He asked if it might be possible for a 
pre-screening in Tonga, to reduce the number of ineligible 
applicants traveling to Suva in vain.  Ambassador Dinger 
noted that he has discussed the inconveniences with CA.  New 
technologies may eventually offer promise; but, for now, law 
and regulation leave no option but traveling to Suva.   Hill 
said he would follow up in Washington.  When asked about the 
proposal for Tonga Defense Service soldiers to deploy a 
second time to the Coalition of the Willing in Iraq, Sevele 
said his government is awaiting a briefing by the TDS before 
making a decision. 
 
FSM 
--- 
¶18. (C) President Urusemal described the difficulties the FSM 
and U.S. agencies have had in implementing the amended 
Compact of Free Association.  He expressed a wish that the 
U.S. would understand better the complexities of coordinating 
the FSM's five governments.  Urusemal observed that partners 
like China and Japan periodically host meetings for Pacific 
leaders; he wondered why the U.S. isn't doing the same. 
Urusemal noted that the FSM police recently undertook a 
deployment to RAMSI.  He said the possibility exists to 
consider UN PKO deployments of police as well.  Hill 
expressed sympathy for the families of FSM citizens who have 
lost their lives while serving in the U.S. military. 
 
Nauru 
----- 
 
SUVA 00000490  006 OF 007 
 
 
¶19. (C) Nauru Minister for Health and Transportation, Kieren 
Keke, outlined his nation's efforts to develop and implement 
a national strategic development plan.  Keke expressed 
appreciation to Taiwan for financing Nauru's recent 
acquisition of a used Boeing 737 to re-start a national air 
service.  That led to the mention of Nauru's request for the 
USG to waive some $133,000 in court fees related to ExIm's 
repossession of Nauru's previous aircraft.  ANP Office 
Director McGann said the Department had received Nauru's 
written request, which is under inter-agency review.  Turning 
to aid, Keke expressed appreciation for U.S. attendance at 
last November's donor round-table on Nauru.  When he asked 
about the prospects of Nauru hosting a Peace Corps program, 
Hill promised to follow up in Washington.  Keke raised 
Nauru's interest in MCC participation, and also mentioned a 
desire for U.S. assistance with airport and seaport security. 
 
 
Tuvalu 
------ 
¶20. (SBU) PM Apisai Ielemia only recently became Tuvalu's 
head of government, after elections in August.  He was candid 
in his appeal to Hill for U.S. help, saying Tuvalu is 
particularly interested in qualifying for MCC funding. 
Ielemia asked if the United States might be able to provide 
Tuvalu access to the U.S. labor market as he said Canada 
does, and he sought scholarships to U.S. schools.  When 
Ielemia requested the return of Peace Corps Volunteers to 
Tuvalu, Hill said he would follow up.  Lastly, Ielemia 
pressed Hill for the United States to ratify and implement 
the Kyoto Protocol, citing Tuvalu's vulnerability in the face 
of climate change.  Hill assured the PM that the United 
States takes climate change seriously, and he introduced 
Embassy Suva's new regional environment officer. 
 
Marshall Islands 
---------------- 
¶21. (SBU) President Kesai Note cited "capacity building" as 
the Marshalls' greatest need in terms of assistance.  He 
raised the Marshalls' interest in hosting a Peace Corps 
mission.  He said limited educational opportunities in the 
Marshalls mean the 10,000 Marshallese now living the United 
States work for the minimum wage and live in some cases on 
welfare.  Hill highlighted the enduring ties with the 
Marshall Islands and thanked Note for his country's 
outstanding support for U.S. military efforts in the Middle 
East and Afghanistan, where more than 200 Marshall Islanders 
are serving.  Note asked Hill about the status of a new claim 
for reparations for illnesses related to nuclear tests in the 
Marshalls.  McGann noted that the issue is before Congress at 
this time. 
 
Palau 
----- 
¶22. (SBU) Compact funding, education grant eligibility and 
problems with Palauans serving in the U.S. merchant marine 
topped President Tommy Remengesau's bilateral agenda. 
Remengesau told Hill that Palau wants an early start on 
review and re-negotiation of its Compact with the United 
States.  Hill said he would advise the Interior Department 
and press for a timely start to talks.  The President asked 
that Palau's eligibility for education grants be maintained 
for the duration of its Compact, beyond its current 
expiration date of 2007.  There are currently two bills 
before Congress that deal with the issue, and Hill stressed 
that the State Department cannot lobby for legislation. 
However, he said he would ask about the status of the bills 
and convey Palau's interest.  Remengesau noted that Palauans 
can serve in the U.S. military, but under current regulations 
cannot work aboard U.S. cruise ships without being U.S. 
citizens or permanent residents. 
 
Samoa 
----- 
¶23. (SBU) PM Sailele Tuila'epa told Hill that Samoa is 
 
SUVA 00000490  007 OF 007 
 
 
interested in hosting professional-level volunteers to help 
with capacity building.  He also raised maritime boundary 
talks, visa issuance in Samoa, and the effort by American 
Samoa to gain associate membership at the PIF.  Hill noted 
that, because of American Samoa's status as an unincorporated 
territory, the State Department has responsibility for 
foreign affairs.  American Samoa needs to follow established 
procedure regarding its interest in the PIF by first 
consulting with State.  Tuila'epa said he would convey this 
to the Governor of American Samoa. 
 
Comment 
------- 
¶24. (SBU) From Embassy Suva's perspective, U.S. participation 
in this year's Forum meetings was very successful.  Island 
leaders were extremely pleased with A/S Hill's 
special-session dialogue.  His bilats on the margins gave 
opportunity to discuss a range of issues, including with the 
PMs of Australia and New Zealand.  Pull-asides with Kiribati 
President Tong resulted in Kiribati switching its vote from 
Venezuela to Guatemala at the UNGA (ref B).  The 
U.S.-sponsored core-partners meeting filled a need.  At U.S. 
urging, the effort to consolidate Pacific-region technical 
agencies will continue to explore modalities, with nothing 
yet set in concrete.  EAP/ANP's close collaboration with the 
Embassy was appreciated.  The 2007 Forum meetings will be in 
Tonga, sometime between July and October.  In the meantime, 
follow-up on a range of issues -- high-level visits; a JCC 
meeting; Peace Corps issues; MCC mechanisms; etc. -- should 
continue to accent that the U.S. relationship with the 
Pacific is alive and well. 
 
¶25. (U) EAP/ANP Director McGann cleared this cable. 
DINGER