As political leaders were gathering for the annual Pacific Islands Leaders Forum beginning yesterday in Cairns, so were the storm clouds.
The meticulously orchestrated centrepiece for the Australian hosts is an announcement that negotiations of a comprehensive free trade agreement between Australia, New Zealand and the Forum Island Countries will begin after the meeting.
Australia and New Zealand have never accepted being left out of the Pacific free trade agreement between the Pacific Island Countries (Picta) that came into effect in 2002. They extracted a commitment that negotiations to include them would begin in 2011 under an umbrella agreement called Pacer. There was a catch - if the Pacific islands countries began negotiating a free trade deal within another developed country, the "consultations with a view to negotiations" would begin before then.
For the past five years the Pacific islands have been required, involuntarily, to renegotiate their colonial-based relationship with Europe. Australia and New Zealand have insisted on parity in their backyard.
That has encountered considerable reluctance, as the implications of shifting from a preferential to a reciprocal trade relationship with their major trading partners are much more significant than with Europe.
To overcome this reluctance, Australia and New Zealand have systematically constructed a "consensus" among the parties to Pacer that negotiations for what is called Pacer Plus will begin after this year's Leaders Forum meeting.
Getting to that position has been a textbook display of power politics. Suva-based Pacific Network on Globalisation (Pang) has just published a behind-the-scenes expose of that strategy, drawing on first-hand reports from officials, ministers and advisers, with formal documentation.
Speaking Truth to Power shows how the region's two dominant powers and donors systematically constructed a "consensus".
Two issues are dominating the immediate backdrop to this week's meeting. Pacific trade ministers from across the region are still angry at an ambush orchestrated by Australia and New Zealand, with assistance from Samoa's Deputy Prime Minister, at their annual meeting in Apia last month.
The two-day meeting was hijacked when the ministers were whisked away to an informal lunch. Five hours later, the ministers had agreed that negotiations on "Pacer Plus" would begin following this week's Leaders Forum in Cairns.
In the process, island governments gave away almost all the ground they had been fighting for over the past year. Three countries were excluded from this critical lunch. Vanuatu, Nauru and Marshall Islands were not present because the senior officials who were representing their ministers were not invited.
Fiji's representative was not allowed to attend the Apia meeting at all, on the ground that it was a Forum trade ministers meeting and Fiji had been suspended from the Pacific Islands Forum. However, Fiji's status at the Forum is entirely distinct from its status as a state party to the Pacer treaty. It cannot be legally excluded from the meetings and deliberations of those parties. Holding Pacer and Forum meetings together is a matter of convenience.
In this situation, they should be held separately to enable Fiji to attend.
Any decision of Pacer parties that is taken in Fiji's absence, including agreement to launch the Pacer Plus negotiations, lacks legal validity.
I set out the detailed argument for this in a legal opinion commissioned by Pang and circulated to the ministers before the meeting. I understand that similar legal advice was given to the Forum Secretariat.
This is not a political matter of how one views the military regime in Fiji. It involves basic legal rights of parties to a treaty, and the fundamental economic interests of Fiji and the other Pacific Islands Countries over the medium to long term. Fiji has invoked its rights under Pacer to consultations among the parties. These are required to take place in good faith and as soon as possible.
The Solomon Islands has informed the other Pacer parties that it endorses the legal argument of Fiji that it is entitled to participate in all their meetings and that decisions made in their absence are invalid.
Australia and New Zealand seem intent on simply ignoring the legal obstacles to their goal. Indeed, Australia is being totally disingenuous by pretending that "Pacer Plus" is legally distinct from Pacer and can proceed without one of the Pacer parties.
Their problem is that the agenda for the Apia meeting clearly stated that the consultations with a view to beginning negotiations were under Article 6 of Pacer.
The longer term ramifications for Australia and New Zealand's relationship to the Forum island countries must not be underestimated. The Melanesian Spearhead Group (Papua New Guinea, Solomon Islands, Vanuatu and Fiji) are already consolidating their position as a sub-regional bloc and "looking north" to reduce their dependence on Australia and New Zealand.
Pushing them and others to the edge over Pacer Plus and Fiji will create further instability and division and resentment of the power politics that Australia and New Zealand continue to employ in the region.
* Professor Jane Kelsey of the University of Auckland law faculty writes regularly on trade negotiations. She is at present in Cairns.