WikiLeaks cable: Chinese/NZ talks on Pacific Island issues

Photo / Mark Mitchell

July 12, 2006
Chinese/NZ talks on Pacific Island issues


date:2006-07-12T03:29:00
source:Embassy Wellington
origin:06WELLINGTON536
destination:VZCZCXRO6021 RR RUEHPB DE RUEHWL #0536/01 1930329 ZNY
CCCCC ZZH R 120329Z JUL 06 FM AMEMBASSY WELLINGTON TO RUEHC/SECSTATE
WASHDC 3020 INFO RUEHBJ/AMEMBASSY BEIJING 0311 RUEHBY/AMEMBASSY
CANBERRA 4474 RUEHPB/AMEMBASSY PORT MORESBY 0586 RUEHSV/AMEMBASSY SUVA
0486 RUEHKO/AMEMBASSY TOKYO 0600 RHHMUNA/CDR USPACOM HONOLULU HI
RUEHIN/AIT TAIPEI 0066 RHHJJAA/JICPAC HONOLULU HI
classification:CONFIDENTIAL
reference:06WELLINGTON451|06WELLINGTON462
?C O N F I D E N T I A L SECTION 01 OF 03 WELLINGTON 000536

SIPDIS

SIPDIS

DEPARTMENT FOR EAP/FO, EAP/ANP AND EAP/CM
PACOM FOR JO1E/J2...
?C O N F I D E N T I A L SECTION 01 OF 03 WELLINGTON 000536

SIPDIS

SIPDIS

DEPARTMENT FOR EAP/FO, EAP/ANP AND EAP/CM
PACOM FOR JO1E/J2/J233/J5/SJFHQ

E.O. 12958: DECL: 07/11/2016
TAGS: PREL, NZ, CH, XV
SUBJECT: CHINESE/NEW ZEALAND TALKS ON PACIFIC ISLAND ISSUES

REF: A. WELLINGTON 462
B. WELLINGTON 451

(U) Classified By: Acting Deputy Chief of Mission Katherine
B. Hadda, for reasons 1.4 (b) and (d)

Summary
-------
1. (C) As part of a first round of New Zealand-China Pacific
Consultations, PRC's Assistant Minister of Foreign Affairs He
Yafei visited New Zealand in June. According to New
Zealand's Ministry of Foreign Affairs (MFAT), He said China
recognizes New Zealand's "very important" role in the Pacific
region, wants to coordinate its efforts in the region with
GNZ at the policy level, and supports the Pacific Plan.
There was frank discussion "between friends" on the
China-Taiwan rivalry in the region, which MFAT says will
continue to complicate its future engagement with China in
the South Pacific. End summary.

2. (C) As part of a five-country tour of the South Pacific
(Australia, Cook Islands, Samoa, New Zealand, Fiji), He
Yafei, one of three Assistant Ministers of Foreign Affairs of
the People's Republic of China, visited New Zealand from June
20 to 22. The visit was a follow-up to the visit of Premier
Wen Jiabao to the region in early April, and involved
consultation on bilateral, Asian region and Pacific region
issues. MFAT says AFM He's meeting with Alan Williams,
Deputy Secretary at MFAT, and other GNZ officials focused on
China's Pacific Island foreign and aid policy objectives and
included frank discussion about China's and Taiwan's role in
the Pacific.

China's Pacific Island foreign and aid policy
---------------------------------------------
3. (C) AFM He characterized China's policy in the Pacific as
promoting regional coherence and economically and
socially-sustainable development. As a developing country,
China understands the difficulties that Pacific Island
countries (PICs) face, which are similar to its own, He said.
MFAT says He took note of the Pacific Plan objectives, and
recalled China's 2005 commitment to give USD 1.25 million in
2006 and 2007 to Pacific Plan programs. Chinese aid focuses
on projects that positively affect peoples' daily lives, such
as infrastructure and public facilities, he said. In
addition to a number of high-profile projects, there are many
smaller ones, involving agriculture, hydroelectricity and
solar energy. Generally the recipient governments are
responsible for identifying project proposals. Chinese
companies usually carry out the contract work.

4. (C) He said China had announced its commitment to the five
main areas of cooperation agreed to at the China-Pacific
Islands Economic and Development Forum in April: trade and
investment; agriculture, forestry and fish; tourism;
transportation; and capacity building. The PRC also announced
3 billion yuan (USD 375 million) in soft loans for PICs over
the next three years and committed to train 2,000 people,
including government officials and those involved in economic
sectors such as energy, telecommunications, fisheries and
health. These programs will cover all Pacific Island Forum
(PIF) members, whether or not they have diplomatic relations
with China. In November, China's Ministry of Foreign Affairs
will hold a second training program for PIC diplomats
(approximately 2-3 per country) and a training program in
China for Pacific journalists. China is willing to
coordinate aid efforts on a policy level with New Zealand,
said He, who added that cooperation at the project level
would be too difficult.

5. (C) The NZAID rep at the meeting told He that GNZ has
increased its aid resources to the Pacific by 45% over the
last three years (including tripling aid to Papua New Guinea,
the Solomon Islands and Vanuatu). GNZ allocates 55% of its
overseas development assistance to the Pacific (Ref A).
Deputy Secretary Williams told He that Pacific Plan
objectives will only be reached if the partners in the region
work together. AFM He said China was open to coordinating
with other donors and making programs more complementary.

China and Taiwan in the South Pacific: It's All "Their" Fault
--------------------------------------------- ----------------

WELLINGTON 00000536 002 OF 003


6. (C) AFM He warned of the "dangers of Taiwan dollar
diplomacy," saying that "Taiwan was very much into
corruption" and alleging that Taiwanese bribery in the
Solomon Islands was a major reason behind recent unrest. He
cited an example from Vanuatu, where Taiwan allegedly asked
Prime Minister Vohor to forge signatures to bring about a
vote of no confidence. He claimed Taiwan officials had also
invited Micronesia's Speaker to Taiwan to try to influence
him. AFM He also brought up the summit that Taiwan plans to
hold with PICs in September 2006, to which he claimed New
Zealand and Australia would be invited. (FYI: MFAT tells us
GNZ has not received an invitation. End FYI.)

7. (C) Williams reiterated that GNZ's One China policy is
deeply embedded, but observed that the China-Taiwan issue
could have negative connotations for the region. Reinforcing
the message delivered by NZ Foreign Minister Winston Peters
the day prior, Williams added that New Zealand does not tell
PICs what to do as they are sovereign nations that make their
own decisions. GNZ does tell the PICs to identify where
their long-term interests lie, however. Williams told He
that at an informal retreat held at last year's meeting of
the Forum Regional Security Committee in Auckland, senior PIC
officials said some PIC ministers felt there was advantage to
playing China and Taiwan off each other.

8. (C) MFAT says He claimed this was "very unfortunate" and
misguided, but said the Taiwan issue is a test China applies
to its foreign relations that provides the political basis
for long-term relations. If PICs believed that they could
gain more money by exploiting the sensitivity of the issue,
they would be mistaken. Everything would be off the table.
One of He's delegation added that smaller countries were
"easier to buy off" through putting money in leaders'
pockets, and claimed Taiwan had used checkbook diplomacy to
keep nations such as the Solomon Islands in the fold.

9. (C) Williams told He there is an association between small
states and weak governance. Some PICs were even facing a
question of whether they could remain viable as nation
states. Williams explained to the PRC side that New Zealand
is starting to make more use of trust funds under the control
of boards in New Zealand. NZAID told He that the PICs which
recognize Taiwan, with the exception of Palau, suffer from
the poorest governance, least stability, and weakest economic
outlook in the region.

10. (C) According to MFAT, He told Williams that while China
is patient on the Solomon Islands and the question of
diplomatic relations, it hopes that New Zealand "would tell
the (Solomon Islands), as you do others" that its was in
their long-term interest to develop relations with the PRC
rather than the province of Taiwan. Williams responded that
building quality governance is essential, but that NZ would
continue to be guided by the principle that it is up to the
PICs to make the sovereign choice about whether to recognize
the PRC.

Comment
-------
11. (C) MFAT believes that the Chinese are genuinely
interested in increased interaction with New Zealand on
Pacific policy. They say a second round of consultations is
planned for Beijing, either in conjunction with New
Zealand-China Foreign Ministry Consultations in November 2006
or separately in early 2007. MFAT sees the Taiwan issue as
the predominant force behind China's involvement in the
region. MFAT further believes that China is looking to New
Zealand to play a more active role in reducing Taiwanese
influence in the region. In MFAT's view, this expectation is
likely to complicate the bilateral relationship between New
Zealand and China, and potentially GNZ ties to the PICs as
well.

12. (C) MFAT also says that GNZ will continue to deliver the
message to China, PICs and others that development partners
need to work in coherent tandem toward quality, long-term
governance and development outcomes. MFAT will also continue
its dialogues with other large regional partners, such as its
recent meetings with Emboffs and heads of mission from
France's Pacific posts (Ref B). MFAT is also speaking to
Taiwan about the implication of the island's assistance to

WELLINGTON 00000536 003 OF 003


the Pacific. NZAID's Pacific Group Director, Craig Hawke,
went to Taipei two weeks ago to deliver "a stern message,"
according to MFAT. End comment.
McCormick