With its suspension from the 16-nation Pacific Islands Forum last week, Fiji has been pushed yet closer to the precipice. The suspension automatically kicked in as the deadline imposed by the Forum nations' leaders on the Fijian military leadership to come up with a schedule for holding elections in 2009 expired on May 1.
The suspension - a first in the nearly 80-year history of the Forum - in effect precludes Fiji from participating in any Forum activities and any international aid programmes that are channelled through it. And it has the potential to affect not just the functioning and the programmes of the Forum but of organisations linked to it.
The Forum's headquarters is in Suva, so can be compared with the United Nations headquarters being in the United States. In effect, therefore, the Forum has suspended its host nation - the UN suspending the US as it were.
Fiji also houses the headquarters of several members of the Council of Regional Organisations in the Pacific. These organisations are engaged in development work across the Pacific states in activities that include education, fisheries, geoscience, environment, telecommunications, energy, media and tourism.
They employ thousands of people throughout the region and beyond, with most Forum employees enjoying a tax-free status in Fiji.
The University of the South Pacific is the biggest in the council group, with 18,000 students from almost all the Forum nations. During the 2000 George Speight-led coup, regional governments had to find considerable amounts from their overstretched budgets to evacuate their students when the university was shut down.
Suspending Fiji from the Forum has the potential to disrupt the region in several ways. It is not surprising therefore that there were reports on the eve of the suspension that the President of the Republic of Kiribati had threatened to cancel his country's membership of the Forum if Fiji were suspended.
Kiribati has a lot to be worried about. It has historic links with its neighbour, Tuvalu, with which it shares the effects of sea-level rise. Its only link with the outside world is through Fiji. Two weekly flights from Nadi connect it with the outside world and its own Christmas Island several time zones away to the east.
President Tong told me in Kiribati last October how much he was worried by the developing crisis: "Economic problems in Fiji have a severe effect here in Kiribati and if a suspension happens we can't say how bad it can get for us."
Tuvalu's Prime Minister, Apisai Ielemia, expressed similar sentiments in Auckland.
These concerns were raised at the Port Moresby meeting and the New Zealand and Australian governments are reported to have assured Kiribati and Tuvalu that their fears have been taken on board and would be addressed should the need arise.
It is unlikely that the Fiji's leaders would retaliate to the suspension in a manner that would affect these small Pacific states. But as President Tong feared, Fiji's worsening economy would have a ripple effect not just on Kiribati and Tuvalu but across the region, as pointed out by University of the South Pacific professor of economics Biman Prasad.
Other recent action to step up the pressure on the Fiji's leaders could bring new worries for Fijians.
Australian Prime Minister Kevin Rudd's plea to the UN not to employ Fijian soldiers, if heeded, could see the comparatively highly paid Fijian soldiers' early return to their barracks in Fiji.
Their situation could well be compared to the battle-weary and psychologically scarred US soldiers from operations in Afghanistan and Iraq returning home to recession-ridden smalltown America where there have been increasing fears of them joining right-wing causes.
Frustration at having been robbed of the opportunity to earn high incomes could easily fan disaffection within the ranks.
There is already rumour about that such undercurrents are already making the rounds.
Such an eventuality could spiral into a situation disastrous for not just Fiji but much of the Pacific neighbourhood and needs to be avoided at all costs.
The Forum nations need to engage with Fiji's leaders now more than ever.
Although there is polarisation within the Forum members, with deep support for Fiji from the Melanesian block - Solomon Islands, Vanuatu and Papua New Guinea - and strong criticism from Samoa (although Polynesian Tonga and the Cook Islands have shown some sympathy) it is highly unlikely that there will be a split in the Forum.
New Zealand and Australia need to stay in the background and let Pacific leaders engage with Commodore Bainimarama, who must be prevailed upon to restore civil liberties and media freedom as a prerequisite to any engagement as a first step, rather than harp on about a date for elections as a pre-condition.
The situation needs to be tackled one step at a time. What is most important is engagement. The spirit behind the Maori Party's wish to engage with the Fiji's leaders must be encouraged.
* Dev Nadkarni, an Auckland journalist, is editor of pacificbusinessonline.com