Archive for ‘International relations’ Category

Blog Link: Reorganizing (the) Defense

datePosted on 16:15, May 15th, 2009 by Pablo

The recent announcement that a Defense Review Board has been convened with the charge of issuing a Defense White Paper in 2010 (13 years after the last one) is the subject of this month’s “A Word from Afar” column over at Scoop: http://www.scoop.co.nz/stories/HL0905/S00152.htm . Lets just say that there are some troublesome aspects to the issue.

Explaining the Opening of Diplomatic Dialogue

datePosted on 00:47, April 22nd, 2009 by Pablo

There has been much blather about Obama kow-towing to Hugo Chavez and Daniel Ortega at the recent Summit of the Americas conference, as well as his overtures to Cuba and Iran. At a minimum, his opponents accuse him of sending the wrong message (apparently it involves “legitimizing” governments that have already been majority elected by their own constituents), and at the worst he is labeled a “socialist” and a “traitor” to the US ideals. The drumbeat of hatred in disloyal opposition is stoked by conservative media outlets, who openly incite the ideologically inclined to physically act upon their irrational fears.

Notwithstanding that type of beat-up, and partisan idiocy aside, there is no reason to be alarmed. US broaching of diplomatic dialogue with various adversaries is a tried and true aspect of conventional diplomacy. Henry Kissinger was a major exponent of the approach, so it is no less useful for US President Obama and Secretary  Clinton to do so. 

As a proven diplomatic tactic, one that the Clinton re-treads who run Obama’s foreign policy apparatus clearly subscribe to, the offer to thaw relations between the US and Cuba, Iran and Venezuela is a “tit-for-tat” strategy designed to gauge the intentions of the opponent. Derived from game theory, it simply states that you open with a cooperative move, then replicate the opponent’s response. If the opponent responds with a cooperative gesture, then continue the iteration. If they opponent responds in an uncooperative fashion, then respond in kind, and only change when the opponent changes the tone of its response. In other words, always replicate the opponent’s move.

As the stronger actor, the US is advantaged by such a strategy, as it puts the other side in a quandary vis a vis domestic constituencies and its own rhetoric (Iran is the current case in point). If there are internal contradictions within the political structure of the opponent, such a strategy is designed to expose them.   For example, the US (under Reagan of all people!) told General Pinochet that they would prefer that he not stand for the presidency of Chile under his rigged constitutional referendum in 1988, and offered several inducements (personal as well as political) for his cooperation. He refused, so the US responded by publicly announcing that, in the interest of US-Chile relations, it would prefer that he did not assume the presidency even if he won.  The conservative coalition that backed him splintered over the offer. He consequently lost the referendum and his hand-picked successor lost the 1989 election that restored democracy to Chile. The point is that Reagan and company wanted a conservative post-authoritarian elected government untainted by the name “Pinochet.” When he showed his megalomaniac tendencies and his support base fractured, Chileans got a left-center, pro-market government instead. Win-win on all counts from a post-Reagan US perspective.

I use the Chilean example only because I am personally familiar with it, but the general point is this: a willingness to talk after periods of estrangement is a diplomatic tit-for-tat opening. It puts the ball in the opponent’s court and gives (US) politicians room to delineate their subsequent moves. Exploiting media opportunities to show “friendliness” is symbolic sop thrown out to soften the opponent’s constituency, and can only be undermined by resistance from one’s own constituency (which is why Fox News and its Republican lapdogs are barking so ferociously about it).  Watching local and international media spinmeisters weave their interpretations (however governments may succeed in controlling interpretations), both sides can measure the external and internal consequences of their respective responses, and carry on accordingly. That gives them a degree of separation from political responsibility in the event of failure.

Closer to home, the question arises: does New Zealand understand the utility of a tit-for-tat strategy when dealing with places like, say, Fiji? If not, MFAT should read the above, and the vast literature that underpins it.

Blog Link: On Denuclearization.

datePosted on 13:24, April 16th, 2009 by Pablo

In the comments thread on my earlier post about whether the US was in decline, as well as in the comments thread on Obama’s Prague speech over at kiwiblog, and during an interview on Jim Mora’s show, I found myself correcting people with regard to US strategic doctrine. That got me to thinking about Obama’s promise to pursue global denuclearization. I decided to write up my thoughts as this month’s Word from Afar column at Scoop: http://www.scoop.co.nz/stories/HL0904/S00148.htm. The bottom line is that there are many reasons to believe that the promise, while apparently sincere, has many obstacles to overcome, and not all of them are located in Iran or North Korea.

The Parallels between Fiji and Thailand

datePosted on 18:38, April 12th, 2009 by Pablo

Although it may not seem likely on the face of it, there are some significant similarities between the political situations of Fiji and Thailand. To understand why, we must start with some background and definitions. Fiji and Thailand are modern examples of praetorian societies. Prateorian societies are those in which social group and political competition occurs in non-institutionalized fashion. Rather than use mediating vehicles such as courts, parliaments, collective bargaining and the like, inter-group competition assumes direct action characteristics: street demonstrations, riots,strikes, lockouts, blockades, and outright physical conflict. This can be due to the failure of such institutions to accommodate social group and political competition within established boundaries of rules and procedure, or it can  be due to social and political group disregard for the institutions themselves. Where institutions such as parliament and the courts still function, they tend to microcosmically replicate the zero-sum approaches of the society at large: dominant groups manipulate the system to their own advantage and use it to punish their opponents. In turn, opponents attempt to wrest control of state institutions for their own gain. Compromise and toleration of difference are lost in the struggle.

The reason social praetorianism occurs is that there is not a shared majority consensus on the political “rules of the game.” This can be due to the lack of ideological consensus or disenchantment with the system as given. Either way, it spells trouble in the form of political and social instability. As a reflection of the surrounding society, this gives rise to something known as military prateorianism. Taking its name from the praetorian guard of Roman emperors, who were said to be the makers and unmakers of kings, a praetorian military emerges as the dominant political actor in socially praetorian societies by virtue of  the force of arms. It s the default option given generalized institutional failure, and as such is characterized by an internal (rather than external) security orientation, high levels of politicization and a strong interventionist streak.

There are two types of praetorian militaries: arbitrator (or mediator) and ruler. Arbitrator military praetorians assume control of government when civilian institutions break down, but do so only to re-establish the constitutional order and provide the law and order that gives civilian actors the time and space to re-establish a consensus on the rules of the political “game.” They usually enter into power via relatively peaceful coups and set themselves a non-partisan agenda as well as a specific timetable for withdrawal from government. The point of the intervention in the political system is to stop political bickering and re-establish the institutional bases of civilian rule.

Ruler military praetorians have no such limitations. Often emerging in the wake of repeated attempts at military arbitration between competing civilian groups, the ruler military has no timetable for withdrawal and a political, social and economic agenda of its own. They tend to be more violent than their arbitrator counterparts, in no small part because they see civilian society as undisciplined and chaotic and civilian politicians as venal, self-serving and corrupt. The modern archetypes were the military-bureaucratic regimes of Latin America in the 1970s, the Pinochet regime in Chile being the most notorious of them. They tend to hold power for a half decade or more in order to transform, via the use or threat of force, the basic socio-economic and political parameters of the praetorian societies in which they are located. When they withdraw, they do so under rules of the game they set down for their civilian successors.

Thailand has oscillated between periods of arbitrator and ruler military rule, interspersed with numerous failed attempts at democratic governance. In the current political crisis, the pro-royalist “yellows” (of airport blockade fame) and pro-government “blues” are vying with anti-government “reds”  (of ASEAN summit cancellation fame) to vie not so much for democracy (which is what they all claim) but for the favor of the Thai military when it finally steps back into power. The yellows are more elite and middle-class in social origin, whereas the reds are lower middle and working class in composition, so the historical odds favor the yellows (the blues are a cross-section of party loyalists of the current Prime Minister, disaffected yellows and hired thugs). But with an ailing King and more reds than yellows taking to the streets, the military may be swayed away from its traditional pro-royalist stance in the interests of securing majority support for a reformative coup. If this analysis is correct, it implies the inevitability of another Thai coup, most likely leading to a ruler military regime that embarks on a program of political reform that breaks with the partisan lines of the past. Given that it confronts a significant Muslim insurgency in the south of the country that has links to similarly-minded insurgent groups in the Philippines, the Thai military will be loathe to be drawn into politics and will only do so if the present levels of social praetorianism threaten to escalate into unacceptable levels of violence that challenge its monopoly of organized coercion within the territorial limits. It is for the Thai civilian elite to prevent this from happening, and so far they have shown no inclination to do so.

The Fijian military has repeatedly intervened in the country’s politics over the last two decades, and the Bainirarama regime is no exception. Fiji’s social praetorianism stems from the conflicts between indigenous Fijians and Indo-Fijians, a conflict that has socio-economic class as well as ethno-religios and linguisitic characteristics. Its civilian political elites have proven incapable of achieving consensus and have a strong penchant for corruption and nepotism. Thus the military sees itself as the “saviour” of Fijian society. With this latest “coup-within-a-coup,” (see Lew’s post immediately below) the Fijian military praetorians appear to be moving from an arbitrator to a ruler role, perhaps because they believe that the country is nowhere close to consensus on a reformed and reconstituted rules of the political game. I have written previously (“Bullying Fiji Part 2: The Inside Game”) some of the reasons why this may be so, but the larger point is that it appears that no amount of pressure from New Zealand or Australia will alter the conviction of Commodore Bainimarama and his colleagues in the Fijian armed forces hierarchy that it is in the country’s best interests to prevent a Thai-type scenario from developing. The UN may be able to exercise some pressure in curtailing Fijian military involvement in multinational “blue helmet” operations, but even then, with Russia and China on the Security Council, the likelihood of passing resolutions authorizing this form of sanction on Fiji for what is an internal matter is, to say the least, unlikely.

The are two dangers to ruler militaries, one specific and one general. The longer leaders of ruler militaries stay in power, the more enamored of the perks of the position they become. Whatever their good intentions at the onset, they tend to become increasingly despotic over time, losing sight of the original project in order to concentrate on their personal fortunes. That increases resentment against the regime and factionalisation within it, which essentially returns the praetorian situation to where it began. Moreover, the longer a military is in power, overseeing civilian ministries and involving itself in politics, the less its leaders are maintaining and honing their war-fighting command skills. This may not be an issue for a country without enemies, but for countries with internal or external threats, the erosion of a war-fighting capability strikes to the heart of the military raison d’etre and emboldens adversaries of all persuasions. Put another way, to remain in power is to lose war-fighting capability, and to lose war-fighting skills (including command skills) is to invite attack. This is especially true for the Thai military, but even the Fijians need to consider this given their regular deployment of troops to foreign conflict zones under UN mandate.

The final problem is that whether the military intervenes or not, and whether it does so in arbitrator or ruler guise, on-going situations of social praetorianism is the key element leading to state failure. One only need look at the recent history of Afghanistan, Somalia and Pakistan to understand the implications.

Seems obvious, doesn’t it?

datePosted on 18:53, April 9th, 2009 by Lew

Lesson 1 for everyone:
Political expedience is no substitute for democratic process.
Lesson 2 for would-be tyrants:
If you’re going to overthrow a state, leave no functional apparatus which might threaten your regime.

The Fijian Court of Appeal has ruled that Frank Bainimarama’s coup was unlawful and that he should be removed from his position as the head of the interim government and replaced with an “independent person” appointed by the President. (No Right Turn has more.)

This is complicated. A few implications I can see (Pablo can probably do better than I, and anyone is welcome to suggest more):

  • The court hasn’t ruled that Former PM Laisenia Qarase should be reinstated – and he would not qualify as an independent person. It’s difficult to think who could, given the regime’s tendency to deport, imprison or intimidate those who didn’t play its game.
  • May 1 is the deadline to announce an election date. However Bainimarama is (I assume) no longer constitutionally empowered to do so. He’s damned either way here – if he fails to do so, he tacitly accepts that he hasn’t the right, and if he does so, then he overrides the court of the land and gives his political opponents a legitimate chance to overthrow the regime.
  • Bainimarama may now be officially illegitimate in law, but he does still command the armed forces in fact, and they have demonstrated in the past few years what they’re prepared to do for him. The task of re-establishing legitimate government is harder than simply declaring an “independent person” the new interim PM.
  • Assuming Bainimarama doesn’t step down, the international community now has firm grounds to throw the figurative book at Fiji, cutting off all aid, trade and diplomatic ties on the grounds that Bainimarama’s government is now illegitimate in law. Indeed, you could argue that they have no choice but to do so. This means a likely deepening of previous policies which haven’t really done much to hurt the regime but have done plenty to hurt the ordinary Fijian people, and could drive Fiji closer to China. Tough call.

Geopolitics is a funny beast. Everyone who’s honest with themselves has known this all along – but it’s taken a panel of Australian judges stating the obvious to pull away the fig leaf and (presumably) force a response.

L

Edit 20090415: Too much has happened over the long weekend for me to write cogently about given the other things I need to do this week, so I’ll refer yous to the excellent Idiot/Savant, with whose judgements I mostly agree on this matter.

Another American Century, or an Empire in Decline?

datePosted on 22:11, April 3rd, 2009 by Pablo

In my professional life  I read as a matter of course the debates about so-called US “hegemony” and whether or its “liberal” view of its role in international affairs will continue for the forseeable future (in this context “liberal” refers to the American idealist tradition of trying to re-make the world in its preferred image, whatever that may be. It is an overarching view that supercedes neo-conservative, neo-realist, constructivist or institutionalist approaches to the international engineering project). I think that the issue is worth consideration by a broader audience.

Some believe that, as the sole military superpower and core economic cog in the global system of finance, production and exchange, the US, albeit over-extended by the military adventures in Iraq and Afghanistan and beset by its financial market melt-down, remains unassailable in its position of dominance in world affairs and will continue to be so for at least the next 30-50 years. If anything, the debacles of the W. Bush administration are seen to have taught US political elites the need for a more sophisticated, broad based approach to both foreign policy and state regulation of  markets as well as domestic political representation, all of which have their crystalisation in the presidency of Barack Obama. For this view, the American capacity for self-renewal in the face of adversity is boundless, which is why it will continue to dominate world affairs in the 21st century.

Others think that the US century has past, and that the emergence of China, in particular, spells the end of its hegemonic position in the world. There is still a decade or more to run before it is eclipsed by the PRC, but in this contrary view the US’s days as the pre-eminent international actor are numbered, particularly given the emergence of other powers (India, Brazil, Russia, the EU, perhaps Australia, Iran and Turkey) and US inability to curb its consumption, dependence on fossil fuels and adherence to nationalist-conservative ideologies as the bulwark against the “socialist” tendencies of Obama and his purported ilk. Mired in arguments about gay marriage and abortion, viscerally fearful of (dark-skinned) immigration, beset by domestic “culture wars,” the US is seen as a self-absorbed, narcissistic giant about to be toppled by a global community sick and tired of its arrogance, ignorance, bullying and meddling.

I am of two minds on this. For all its military misadventures the US can still do what no other country or combination of countries can do when it comes to projecting force. Guerrilla wars may bog it down but will never threaten its core interests. Likewise, although its economy is stagnating, it still dwarfs any other regional, much less national market and still has a dramatic repercussive effect on all other markets in the global commodity chain. It may be somewhat bowed, but it is as of yet unbroken.

On the other hand, its cultural vacuousness, its myopia, its clear signs of decline on all fronts relative to a decade ago suggest that the US is, in fact, slipping from the position of superpower to that of just another major power amongst others, and that it can do nothing to prevent the international system moving from the the unipolar configuration of the immediate post-Cold War era to something that although as of yet unclear, will certainly be multi-polar in a decade or so.

Which leads me to ask three questions: 1) at the point that the US feels itself being eclipsed (should that occur), will it wage a last ditch war (or wars) to prevent that from happening, and if so, will these conflicts go nuclear (which is where the US arguably has its most decided military advantage in terms of delivery platforms as well as array of warheads)? 2) will the world be a better place in the event that it does cede its preeminent role to rising powers? 3) what is the “proper” class, environmental or otherwise “progressive” line to take on this?

A Green Neo-Realist Foreign Policy Manifesto

datePosted on 23:28, March 24th, 2009 by Pablo

Now that the Green Party has matured into the third most important political party in NZ, it is time that it develop an equally robust foreign policy stance that moves beyond its visceral commitment to pacifism, human rights and civil liberties, international ecological defence and anti-imperialism. Although laudable goals that still have a place on the Green foreign policy agenda, these foundational pillars need to be supplemented by a more nuanced and less ideologically rigid, but no less idealist in principle, approach to New Zealand’s foreign affairs.

Lets start with defence and intelligence. The Green Party should maintain their absolute commitment to conventional and unconventional weapons non-proliferation, nuclear disarmament, prohibitions of chemical and biological weapons and bans on the manufacture and sale of land mines and other indiscriminate munitions. It should maintain its commitment to seeing the NZDF externally focused on peace-keeping and nation building as its major priority. It should resist efforts to turn the NZDF in to a mini Australian armed forces, and resist the calls for the NZDF to follow Australia, the US and the UK into battle no matter the context or justification. But it also has to realise that NZ’s own defence is premised on its being a good international security partner, and that it cannot abrogate its responsibilities in that field. To that end, the Greens should support efforts to restore a close air/ground support wing to the NZAF in order to provide NZ peace-keeping troops with independent air cover in foreign conflict zones. Even when under multinational military control such as the ISAF mission in Afghanistan, military protocols allow services of each country to protect their fellow troops as a priority. If NZ is going to continue its level of international troop deployments in conflict zones like Afghanistan, East Timor, the Solomons and elsewhere, the ability to provide protective air cover to its troops on the ground is surely a worthy cause. And, as it turns, out, be they rotary or fixed wing, surplus close air support platforms in the inventories of several NATO and other countries come relatively cheap when compared to the aborted F-16 purchase of a decade ago.

Likewise, the Greens needs to support the reinforcement of the Navy’s long-range patrol and interdiction capability, if for no other reason than to protect the resources located in the NZ Exclusive Economic Zone and to deter illegal poaching of whale and endangered fish in the waters adjacent to it. Moreover, such a capability can also serve in anti-piracy roles in the sea lines of communication most vital to new Zealand’s trade, and to keep track of the increasing presence of foreign submarine and surface fleets in and around New Zealand waters. Passivity in the face of such probes will likely be interpreted as acquiescence or inability to counter them, which will encourage further encroachments into the EEC, if not the territorial limit itself. That is also why the Greens need to support the continuing emphasis placed on the NZSAS as the country’s special operations branch. What it can do differently is question the deployments they undertake on behalf of foreign powers, perhaps broadening the scope of their activities to areas outside of the usual SOLIC (special operations and low intensity conflict) scenarios.

 Thus, the Greens should support efforts to increase NZDF spending to  1.5 percent of GDP, in line with the lower threshold of OECD nations, but with a specific focus on the Green “line” of defense and security priorities. No more over priced and ill-suited LAVs, no more $1 million-a-copy anti-tank shoulder fired rockets–just the best weapons and platforms for the NZDF’s unique “niche” role in international security affairs. Even if coat-tailing on previous Labour initiatives, a neo-realist Green approach to defence can provide a human security orientation that extends beyond the traditional security concerns of the major parties.

With regard to intelligence, the Greens must continue their valiant opposition to the unaccountable and often rogue behaviour of  the NZSIS and Police intelligence. But it must couple its demands for more democratic accountability and transparency–something that may begin with the appointment of Russell Norman and Tariana Turia to the Parliamentary Security and Intelligence Committee–with a more reasoned demand that external intelligence collection be separated from domestic intelligence collection and delegated to different agencies. Counter-intelligence functions can be shared because foreign espionage often follows commercial and criminal avenues, but the business of spying in foreign places is very different than spying on one’s own citizens. Thus the Police should be responsible for the latter, with all of the attendant legal safeguards that purportedly govern their operations, whereas the NZSIS can limit itself, along with the GCSB, to external intelligence collection and analysis. No other political party has even mentioned this, much less understood the multiple rationales as to why decentralisation of intelligence functions is actually an important step towards removing the authoritarian culture so deeply imbedded in New Zealand’s intelligence apparatus. In line with these reforms, the Greens should demand that the PSIC be elevated to the status of select committee allowed to review classified material in closed session. Only then will real parliamentary oversight of the intelligence apparatus be possible.

In terms of trade, the Greens need to modify their generic opposition to trade. Instead of a seeming blanket opposition to open economies, the NZ Green Party needs to understand that for a vulnerable isolated and resource-scarce country like NZ, trade is a lifeline. It is here to stay as the mainstay of macroeconomic policy. Therefore, the issue should not whether to trade or not to trade, but how to trade? The answer, as I have mentioned in previous posts, is to trade fairly as well as (or as opposed to) freely. Trading fairly means to concentrate not just on tariff reduction and other bi-or multilateral entry conditions, but on after-entry conditions pertinent to labour rights, working conditions, gender and indigenous issues, wages, health, safety and environmental standards. The goal is to promote a level of regulatory symmetry n the trade relationship, thereby leveling the playing field or at least standardising the rules of investment and competition in the interest of productivity, growth AND human dignity in the labour process. This is as true for NZ investment abroad as well as foreign investment in Aotearoa. The basic thrust is to do onto other (foreign) laborers as what one would do onto oneself (or one’s co-nationals). Capitalists may not like the impact on their short-term profits of promoting such trade agreements, but it is in their longer-term interests, in terms of a guaranteed restrained rate of profit, that they play fair and symmetrically. Moreover, such a stance places NZ at the forefront of trade debates that emphasize a balance between profit, growth and larger communitarian considerations.

Diplomatically, the Greens need to promote a strengthened constructivist-institutionalist approach to foreign policy. Constructivism in foreign policy is focused on normative value change in key policy areas (say, human rights and disarmament)  and institutionalism is focused on strengthening multilateral institutional approaches to conflict resolution and global peace and stability based on shared ideals.  Although Labour advocated such an approach, it too often has compromised its stance in order to curry favour with trade or defence partners. National has no commitment to idealism in foreign affairs. Thus it is left for the Greens to push hardest for an ongoing, if not increased commitment to finding multilateral institutionalised approaches to the sources of international disputes, and to push for progressive value change within international organisations and regional institutions. In doing so it will help continue New Zealand’s reputation as an honest international broker, mediator and arbitrator committed to supra-and transnational methods of grievance redress and resolution. After all, if the world is truly to move away from the anarchic” state of nature” that is the realist conception of international affairs, it needs to move beyond the nation-state as the ultimate adjudicator of international disputes. It is up to small countries to make the case. It is their self-interest to do so, and that is eminently realist in conception. It is, in other words, a bit of Green (neo) realism at play.

All of this is a big task and may run counter to the wishes of more militant elements in the “watermelon” constituency of the Green Party (which should be seen as a source of strength rather than as a weakness). Now is the time to move beyond the parochial environmentalism, classism and other foundational Green principles and towards an agenda that attracts more mainstream voters in pursuit of being a legitimate swing vote and therefore real power broker in the New Zealand political system. This foreign policy manifesto is a gesture in that direction. That does not mean abandonment of  the foundational principles, but the enhancing and expanding of them. This is important because only the Greens have the ability to contribute significantly to a shift in the status quo political discourse currently on display. No other party does.

 After all, with ACT having prostituted its libertarian principles to the crime and punishment authoritarians headed by Mr.Garrett (see Lew and Anita’s posts on the issue  below), the Greens are the only honest political party left in parliament–with them, what you see is what you get, full stop. Given that unique position of advantage, now is the time for the Green Party to develop more depth to their policy agenda, which is why this post is tabled.

`progress’ in Afghanistan

datePosted on 18:12, March 10th, 2009 by Lew

deadafghani

WikiLeaks has published four internal NATO briefing documents pertaining to the war in Afghanistan – including the Master Narrative which sets out the operational and strategic and symbolic parameters which guide ISAF’s media posture.

This guidance document is designed to assist all those who play a part in explaining the situation in Afghanistan and the International Security Assistance Force (ISAF) mission, but especially those who deal with the media.

You can get the documents here. Interesting and revealing stuff but possibly more mundane than you might expect. If I get time over the next few days I’ll post a few observations (and if anyone else wants to do so, be my guest). In an epic security fail, the documents were distributed using Microsoft SharePoint, and protected with the absurd password `progress’.

What significance the image of an ISAF sniper posing with the corpse of an Afghan, you ask? This is the amazingly political choice of image on the WikiLeaks editorial which announced this particular leak – saying it’s misleading doesn’t go far enough, it’s an outrageous association to make. But it’s also the polar opposite of the media agenda which these ISAF documents explicate, and in that regard it’s a crafty bit of work.

(Via Bruce Schneier.)

L

Are FTAs OK?

datePosted on 15:40, February 28th, 2009 by Pablo

The Feb 27 announcement that NZ and Australia have signed a Free Trade Agreement (FTA)  with the ten member Southeast Asian regional grouping known as ASEAN has been hailed as another triumph for NZ’s economic openness, especially coming at a time when protectionist and nationalising policies have re-emerged in response to the global market crisis now ongoing. Although Trade Minister Tim Grosser signed the AANZ-FTA agreement at the 14th ASEAN summit in Thailand, it was MFAT officials working under instruction from the 5th Labour government who sealed the deal (after 4 years of negotiations), and it is these officials who are now beginning talks with India on a bilateral FTA similar to the one signed last year with the PRC. Yet, amid all the self-congratulation by government officials and business leaders, the nagging questions remains: are such FTA’s always good for the average Kiwi?

Pro-trade advocates will say yes on three counts. First, increased markets for NZ exports means more jobs in those sectors as well as their subsidiaries and ancillary industries. Second, increased foreign investment opportunities for NZ firms will eventually increase dividends for Kiwi shareholders. Third, access to a wider range of import markets means more competition and lower prices for Kiwi consumers. But there is more to the picture than this seemingly positive sum outlook.

The AANZ-FTA, like the FTA with the PRC and the P4 FTA signed earlier by NZ with Brunei, Singapore and Chile, is more properly seen as a tariff reduction scheme. In the case of the AANZ-FTA, the goal is to reduce common tariffs by 96% by 2020, thereby paving the way for the development of a a EU-style common market along the Western Pacific Rim that can compete with the EU, the US and emerging giants like the PRC, India and Brazil. NZ estimates are that it will eventually enjoy a 99% reduction in tariffs on its exports to ASEAN while ASEAN members will receive an 85% reduction on their imports to NZ. With US$ 31 billion is ASEAN exports to Australia and NZ  and US$16.8 billion of Australian and New Zealand exports to ASEAN members in 2007 (75% of that volume being between Australia and ASEAN, with NZ exporting US$4.6 billion to ASEAN members in 2008)), the objective is to raise the flow of goods and services ten fold over the next decade. Tariff reduction is seen as the key to achieving this goal, as it will lower transaction costs and remove fiscal impediments to investment within the partnership.

The problems with this arrangement stem from the asymmetries in the respective economies involved, from the lack of “after-entry” provisos, and from the dubious character of some of the regimes involved. With regard to the latter, the AANZ-FTA includes Myanmar and Brunei, two despotic regimes whose trade reliability and fiscal responsibility, much less human rights records, are open to question. It includes Thailand, which has the appearance of a politically failing state where sex tourism weirdness competes with highly exploitative labour-intensive low-cost production as the primary source of GDP, all amid grave ethnic conflict in its southern regions. It includes Laos and Cambodia, two states that barely meet the criteria for inclusion in a globalised trade regime. Its leading members, Singapore, Indonesia, Malaysia and the Philippines, have issues of political and/or corporate governance (be it in a lack of corporate transparency and/or a lack of political accountability), and the remaining member, Viet Nam, is a one party authoritarian regime that, if not as retrograde as Myanmar, has yet to exhibit the developmental potential of some of its most proximate neighbours. ASEAN is, in other words, a polyglot of corruption, nepotism, economic underdevelopment and exploitation mixed with crass materialism and indifference towards basic human rights and civil liberties in a highly charged ethnically diverse and stratified demographic, with a profoundly unequal distribution of resources and reliability amongst its members. Is that what NZ wants in terms of preferential trading partners?

Not surprisingly, the AANZ-FTA, which is due to go into effect on July 1 2009, has no common labour standards, including provisions regarding collective bargaining, right to organise, female and child labour, occupational health and safety and quality control. It has no environmental clauses. All of those are left to the industries involved. The Fontera PRC subsidiary’s Melanin scandal gives an indication of what can happen when such is the case.

Then there is the issue of size asymmetries and economies of scale. Is it plausible to think that with Australia coupled to NZ on one side of the AANZ-FTA ledger, NZ is going to be an equal beneficiary of the new tariff regime? If Australia turns out to be the major focus of ASEAN trade, will that not accelerate worker exodus and capital flight from NZ to Aussie under the terms of the CEP? Is it plausible to believe that with the lack of labour and other standards, NZ businesses in a variety of value added or service sectors will not have an incentive to re-locate their workforce in ASEAN countries where wages and benefits are lower? Is it plausible to think that NZ, with an export base in relatively inelastic primary-good industries and their derivatives (say, milk powder or paper pulp) will enjoy an equitable balance of trade with more elastic value-added importers? Is it plausible to think that foreign investors will not use the opportunity provided by relaxed investment regulation to assert direct control over NZ productive assets (which is an issue that also is at play with regards to the FTA with the PRC)? What NEW productive activities will actually  be created in NZ that will help diversify the economy while providing new employment opportunities that require so-called “knowledge-based”  skills? (For an earlier discussion of the problems of asymmetric trade, with specific regard to the PRC FTA, see http://scoop.co.nz/stories/HL0803/S00263.htm).

These are the questions that need to be asked in the parliamentary debates leading up to the July 1, 2009 ratification date. It is important that the Greens and other groups with concerns about FTAs avoid the appearance of knee-jerk protectionism that they have been saddled with in the past (as was the case with NZ First). Instead, the emphasis must be on the hidden “F” in an FTA–the FAIR aspect of trade, which for a small democracy such as NZ is as important as its free aspect. After all, free trade is not necessarily synonymous with fair trade, and it behooves the political Left to make that point since no one else (to include Labour) will.

Indentured Servitude, Modern Asian Style.

datePosted on 23:26, February 21st, 2009 by Pablo

A few weeks back I wrote a post about European complicity in an Asian experiment in developmental authoritarianism. Aside from one blogger who felt that the post was racist because I noted the Confucian justification for this particular brand of authoritarianism, most readers understood that my points were simple: that when living in an authoritarian country one does not have to subscribe to the local cultural logics and ideological justifications for oppression; and it is dangerous for small liberal democracies like NZ to have returning ex-pats and new immigrants who subscribe to such logics assume positions of political and economic control.

Now I will give a specific example of why I believe this to be true. It involves the plight of maids in the Asian state in which I reside.

In this country maids are not covered by local labour law. They are required to learn English before their arrival. Employers are required to post a $5000 bond for securing their services, which is forfeitable if the maid engages in “unacceptable” behaviour. Such behaviour include getting pregnant, drinking in public and consorting with foreigners. By law, maids have zero days off per year–read that again: ZERO days off. The length of the working day and conditions are set by the employer. By law, maids have to be foreign, in this case usually Philipine, Indonesian, Indian, Bangladeshi, Thai, or mainland Chinese. They must always be female, and they must, unless otherwise specified, be under the age of 30. Maid recruitment agencies specialise in different nationalities depending on the employers preferences. Some employers want docile characters, some want ethnic kin, some want high school grads, some want children-friendly, some want cleanliness freaks, some want sultry, some want young (18 is the legal age for contracting a maid). It all depends on the employer’s penchants and proclivities. For their service, maids are paid, in a very generous household, a salary of $200/week.

Maid quarters are most often windowless cubicles located off an open air laundry with a toilet, washbasin and cold water shower. In many cases the maid cubicle has external locks to prevent their unauthorised exit from the employer’s premises.

Given the bond requirements, there is no incentive for employers to allow the maids out of sight. Thus the no-holiday rule plays neatly into the employer’s (and the state’s) rationale. To be sure, an employer can forfeit  the bond if the maid, say, falls to her death while cleaning the windows of a high-rise apartment (that has happened). But the thrust of the laws are to control the maids, not protect them. The servitude of the maids is such that foreign MNCs calculate in their relocation packages not only the costs of losing the bond should the maids of their executives misbehave, but also the costs of the maid being upgraded to the status of domestic partner (which is common to the point of becoming a joke amongst resident expat Europeans). 

The incidence of maid abuse is a well guarded but open secret. Since they are not covered by labour law, any maid subject to sexual, physical, financial or emotional abuse must report the complaint to the Police. The Police are wary of “he said, she said” type of complaints and are ordered to be suspicious of foreign nationals in any event, so it takes an extraordinary (young) woman to make a formal complaint knowing that the best result will be her deportation.

NZ has strong diplomatic, economic and security ties with this country. In fact, it has  a Free Trade Agreement with this country as well as a defense partnership. NZ-born executives populate the upper reaches of its managerial elite, and they enjoy the services of these maids. NZ fetes this country’s leaders whenever they visit. In fact, NZ uses this particular country as a model for economic development in a trade-dependent state. Yet at no point, either under Labour or National, has the NZ government questioned the propriety of close relations with a country that uses indentured servants as part of its economic development. The country in question is not the PRC–that is a whole other kettle of stinking fish.

There is much more to this picture but I will stop with this question. Do you, as a New Zealander, countenance close state-to-state relations with a country that uses indentured servitude as a component of its development strategy?

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