Cocktails are waiting for tourists in Rarotonga while New Zealand Prime Minister Jacinda Ardern talks about a "framework". Photo / 123R
Cocktails are waiting for tourists in Rarotonga while New Zealand Prime Minister Jacinda Ardern talks about a "framework". Photo / 123R
COMMENT
The Cook Islands are bleeding a slow financial death, drained of tourist income and facing the unpalatable prospect of seeking economic life support from outside the Pacific neighbourhood.
The Cook Islands Prime Minister, Henry Puna, who put his country into lockdown on March 5, has said it will soon run out of money. Incoming Prime Minister Mark Brown tabled a Budget last month that would support the Cook Islands through to September: "After that we will look at borrowing."
The current financial situation has hit Rarotonga and the other 14 islands that make up the Cooks harder than any recent cyclone rebuilding programme. It is matching 1996 proportions when the Cooks were on the brink of bankruptcy. Fletcher Melvin, chairman of the recently formed Cook Island Private Sector Taskforce, warns there is a real risk of history repeating.
As well as New Zealand, China has supported Rarotonga with infrastructure projects and loans. As the tourism-starved Cooks head towards insolvency, will it be forced to turn to China to bail it out?
A Reuters report in 2018 said the majority of China's financial support comes in the form of concessional loans, while traditional regional players Australia, New Zealand and the United States tend to provide gifts. Some within the current New Zealand Government fear the Cooks will follow Tonga into a reliance on funding from China. China have already paid the Cooks administration millions of dollars for tuna fisheries licences, loaned many more millions for the massive Te Mato Vai water project and there is talk of Beijing funding the development of a deep-water port on remote Penrhyn Island.
Two years ago, Cooks Opposition deputy leader James Beer warned about the effect the "soft loans" that accompany Chinese aid were having on the economy. He said if the tourism industry was to fail, the country might not be able to service the loans.
Yes, we can send them money — New Zealand currently provides about two-thirds of the Cooks' official development assistance — but it doesn't want handouts, just tourists. Tourism accounts for nearly 70 per cent of the Cook Islands economy and in June, for example, the Cooks would usually host 16,000 visitors, 11,000 of those coming from New Zealand. Instead, Puna says, the resorts are "empty".
Last month, Melvin said the Cooks would "rather have New Zealand tourism dollars than its aid money".
"Why wouldn't you open up to the Cook Islands? We're a safe destination. Why Australia? We should come first, we're New Zealanders . . . We haven't had any cases of Covid . . . This doesn't make any sense."
Mike Pero. Photo / Andrew Warner, file
Puna, in making his case for a safe travel zone between New Zealand and the Cooks — let's call it an air bridge — says he considers them one and the same. With no community transmission in New Zealand, there's no risk and the Cook Islands route should be treated as a domestic flight.
Sure, Kiwis are spending money and supporting local businesses by holidaying in New Zealand, but a few million dollars spent in the Cooks — a mere drop in the bucket of New Zealand domestic tourism spend — will help save them.
Prime Minister Jacinda Ardern and her coalition partners continue to acknowledge their desire to restart travel to the Cooks. Continuous acknowledgement is one thing, but there is now a need for some action. Let's build that air bridge.
I understand the need for a cautious approach to reopening our borders, but what does she mean by ''working on a framework''? This phrase appears to be her default position when reluctant to make a decision. She used it as long ago as June 9 when referring to reopening our links with the Cooks. Now, some three weeks on, can she finally explain what that framework might look like?
The Cooks has been Covid-free throughout this pandemic and New Zealand's Covid-19 cases are now in quarantine. Rarotonga has absolutely no aircraft or vessels bringing passengers in or on to the Island, so how could either country be a threat to the other? Is it any different to the Chatham Islands?
The Rarotongan resort owner Tata Crocombe told the Cook Island News last month that effectively $199 million of the Cooks' $200 million tourism revenue went straight back to New Zealand, in spending by the tourism, hospitality and retail sectors and their workers — "so tourism was a win-win."
He said it was madness to continue the travel shutdown. "If New Zealand keep this up, they're going to have to bail out the Cook Islands — and have thousands of people going back to New Zealand to go on the benefit again, like in 1996." He said Ardern was right to be concerned for thousands of Kiwis worried about their jobs. "Well, over here, about 5000 people in the tourism industry, most of them New Zealand citizens, are about to lose their jobs."
Clearly, the borders with Australia and the rest of the world need to remain closely monitored, but, please, Prime Minister tell us why you are so reluctant to let us travel to and show our support for the Cooks? If you have no plan for an imminent lifting of travel restrictions, at least be transparent and inform our Pacific cousins. Give them time to prepare for the mortgagee sales and repossessions. This is not the time to hide behind "a framework" and watch as a tide of debt washes over your fellow New Zealand citizens.
