Kaliopate Tavola likes ' />

The prized view from the ninth-floor office of Fiji's Minister for Foreign Affairs and External Trade in Suva faces south.

Kaliopate Tavola likes it that way.

"You can usually see my island, Kadavu, the fourth-largest in Fiji. We call it little New Zealand because it is to the south."

The observation is mildly humorous.

Earlier that day the Chinese ambassador had insisted that Pacific Island states now had a policy of looking north, to Asia, to develop closer ties with the likes of China and Japan.

It is a scenario that makes some foreign affairs officials in New Zealand nervous, concerned this country is slipping too far off the diplomatic horizon with a perceived waning of influence in the region.

There is further anxiety about a bidding war between China and its rival Taiwan where the dollar diplomacy has been blamed for increasing political instability in countries like Vanuatu, Kiribati and Tuvalu.

Tavola says since the end of the Cold War there has been a political vacuum among the super-powers in the Pacific with indifference from the US and Britain down-sizing its presence.

China and Taiwan have meanwhile increasingly recognised Pacific microstates as a valuable bloc.

Tavola says Beijing saw its chance of coming into the region and the Chinese presence in the Pacific is now significant.

Taiwan enjoys the support of six Pacific countries (Tuvalu, Kiribati, Marshall Islands, Solomon Islands, Palau and Nauru).

The mutual distaste of the two creates problems at many levels.

For instance, China has gained membership of the Council of South Pacific Tourism Organisation, a regional body based in Suva, and now Taiwan wants equal status. Tavola says that now has to be resolved.

"If China had its way it would not want Taiwan on that. So we have to resolve the situation amicably and are looking at how both countries can be represented there."

Fiji has been said to play a risky game with its benevolent friend China which was angered when Taiwan's President Chen Shui-bian was allowed to transit through Nadi this year following a whistle-stop tour of Pacific nations which recognise the breakaway republic.

The cheeky overnighter angered the People's Republic of China especially when Fiji sent its Deputy President, Ratu Joni Madraiwiwi, to welcome Chen.

"In the Pacific we do welcome people," Tavola says in defence. "Even when considering Taiwan as a province of China, the President of a province is a man of high profile, so when he comes there is an urge to extend hospitality."

Tavola says Fiji had to explain to China what it was doing and emphasise its one-China policy. "There's no way we are going to change that overnight when Taiwan comes knocking on our door."

China has supported major projects like the multimillion-dollar sports stadium in Suva which was built for the 2003 South Pacific Games (and is now doing the same for Samoa).

Tavola thinks both countries "mean well" but there are at times pre-conditions with aid.

"That's nothing unique."

Tavola insists Fiji does not feel financially beholden to China and its commitment is rather to the United Nations charter that recognised the one-China policy.

Down the road from Tavola's office the Chinese embassy in Suva sits on the waterfront Queen Elizabeth Drive, away from other embassies in downtown Suva.

Large and with a swimming pool, the former hotel was bought in the 1970s.

Ambassador Cai Jinbiao says they are looking to build a new embassy nearby. "This one is running down."

Jinbiao is critical of Fiji for allowing Chen's visit.

"There was no point, he could have flown straight from Tuvalu to Taiwan ... he was on a sabotage mission, trying to prove he could develop relations with countries already in relationship with China."

China will never back off and allow Taiwan the sovereignty it seeks, he says.

"For China nothing is more precious than its own territory."

Jinbiao notes how hard Taiwan has been trying to open its diplomatic space including by playing dollar diplomacy especially in small countries like Kiribati and Tuvalu which are economically vulnerable and their governments not stable.

"It gives Taiwan the opportunity to play around ... We strongly oppose these types of dealings because it's not really helping these countries develop economically ... they have to see the political motive."

All Taiwan wants is support for its independence movement, he argues.

"We try to point this out to developing countries - to watch out for Taiwan's plot."

He hopes countries in the region realise that and support mainland China's case for reunification.

"Countries should conduct relations in mutual respect for common development rather than resort to ideology."

China has been a lucrative friend to Fiji, says Jinbiao, granting aid for projects from growing rice to building bridges, working on the electricity network and paying for hydro-power schemes.

"Our focus is to engage in projects that bring direct benefit to the people."

Jinbiao says bilateral trade has been growing steadily, its volume close to $US39 million ($55.8 million) though most of that accounts for Chinese exports to Fiji.

Jinbiao quickly points out that tourism, which now generates about half Fiji's foreign income following hits to its sugar and garment industries, is set to benefit from Chinese holidaymakers, now that Fiji, Tonga, the Cook Islands and Vanuatu have been approved as distinations for Chinese tour operators.

When asked why China wants to help, he says China has received different kinds of aid from developed countries, and as the largest developing country now has an obligation to offer help to others.

There is also a downstream benefit in developing future markets with which to do business.

"In helping them be more capable in their nation building and economic development in turn we will also benefit from economic co-operation, so it's a win-win situation."

Jinbiao denies aid money does not always go where it should. "You might be talking about Taiwan," he says.

When granted aid, Fiji has to sign memorandums of understanding that that money is spent on the allocated project.

China does not give cash aid but Jinbiao confirms it offers "other" financial support like debenture loans.

To say China does not insist on good governance is groundless and wrong, he says.

"We don't put on political strains when we grant aid but that doesn't mean we don't care about stability in the region ... we wish the region to be stable and the countries all be governed by law and improving people's lives, for people to have better living conditions, enjoy more cultural and social facilities."

He outlines the main planks of China's foreign policy to pursue peace and develop friendly relations and co-operation with all countries in the world.

Jinbiao does not see New Zealand's influence lessening.

"I don't think New Zealand or Australia are losing their influence, not diminishing, after all this [Fiji] is closer to New Zealand, your volume of trade is increasing. The relationship is long.
"Get one thing straight - we don't want to influence anybody ... [and] we don't want to drive out the influence of Australia and New Zealand. Our aim is one of friendship and co-operation and we don't want to take anything away ... we don't have a self-interest."

Jinbiao says there are always people finding fault with what China does in the region based on misunderstanding.

He asks if the Weekend Herald plans to meet Sherman Kuo, the Taiwanese trade representative in Suva and suggests "not to bother", adding that New Zealand recognises the one-China policy.

Should a meeting be arranged, Jinbiao warns to be "very watchful" as Kuo was firm in the independence policy.

Kuo is more aloof than Jinbiao, speaks not quite as perfect English, and sports a long nail on his smallest left-hand finger that slices through the air as he talks while two aides take notes of the interview.

His office on part of the sixth floor of Pacific House in the heart of Suva bears the name: Trade Mission of the Republic of China (Taiwan) in the Republic of the Fiji Islands.

Kuo says Taiwan wants a formal relationship with every country in the world, and to be recognised as sovereign state. It is seeking support to join the United Nations and wants observer status at the World Health Organisation. He sees China as an increasing influence in region and it seems "very obvious" that Beijing wants to take the place of Australia and New Zealand.

Kuo doubts whether China's huge market will ever be of much use to Fiji which has "nothing to sell" and queries whether Chinese tourists will be interested in going there in the short term. He brushes off frequent accusations that Taiwan is itself just trying to buy favours in the region.

His reply echoes that of Jinbiao when he says: "Taiwan was a poor country before and got a lot of help. We now wish to take part in international society to help our friends."

Kuo says China spends millions on Fiji; he estimates $64 million in the past decade, whereas Taiwan gives much smaller amounts like a US$750,000 per annum grant for grassroots rural development as well as some training courses and scholarships. He says claims about waste of aid and lax controls in Pacific countries which support Taiwan are "ridiculous" and throws the accusation back to China which he blames for creating such suspicion.

Dr Steven Ratuva, senior fellow in governance, University of the South Pacific, says while the Pacific Ocean is huge its islands are small and politically congested. "So Taiwan's role in the Pacific has led to tension."

Ratuva says problems arise from how local politicians have responded to Taiwan's offers, and in cases governments have changed as a result.

Although the United Nations decided to recognise one-China, the individual countries still have the choice and Taiwan lures small, poor countries in Africa, the Caribbean and Pacific through financial incentives.

Last year Taiwan invited Ratuva and a group of Australia National University academics to advise it on regional policies and trade to see how it could fit in.

Ratuva sees criticisms directed at both China and Taiwan over their perceived lack of interest in good governance in the countries they assist as judgmental. "The word 'good' is highly moralistic, almost meaningless, so we now talk about what is most appropriate and how aid can increase efficiency."

He agrees, however, that in the Pacific transparency remains an issue and processes regulating financial systems need tightening up.

Ratuva says efforts to exert influence take different forms and he argues aid from New Zealand and Australia during the Cold War was in part intended to keep the Pacific in line with the Western bloc. "Aid is still ideological bribery. New Zealand and Australia are as guilty as the Chinese; it's the same pattern."

He says aid from China and Taiwan tends to be more focused on leadership and governments, whereas that of Australia and New Zealand is about "sending in their experts".

"In Australia 80 per cent of aid goes back there in the form of employment of its citizens; New Zealand is similar."

There are increasing moves to avoid giving aid to government, instead directly to non-government organisations to avoid political bribery. But Ratuva says a lot of New Zealand and Australian aid is not transparent as they don't allow for open competitive bidding for projects.

Greg Urwin, Secretary General Pacific Islands Forum Secretariat, says the forum has programmes to tackle improved governance and security.

"The encouragement of anti-corruption and integrity is one focus of the Pacific plan exercise which is starting to get support from donor partners, including ... China."

Urwin believes China is genuinely interested in the way its role is developing and beginning to see its presence in the Pacific more long term. Of concerns that New Zealand's role is diminishing as a consequence, he says "that doesn't square with my experience".

China, he says, has a more general influence in a global role, whereas within the region New Zealand was "very much at the sharp end of things".

Urwin says is more interested to see how the US responds to China's increasing presence.

In Tuvalu, a two-hour flight north of Suva, the financial help of Taiwan is so well ingrained in the national psyche that some say it would be political suicide for a government to even suggest switching allegiance to China. Taiwan spent A$11.5 million on the new three-storey government building, the biggest in Tuvalu, as well as a half-million-dollar fit out.

The generosity won't be forgotten.

Outside the building in the capital Funafuti, a prominent plaque reads "Coconut palm planted by H. E. Chen Shui-ban, President of Republic of China (Taiwan) in commemoration of his state visit to Tuvalu on May 4, 2005". There is another well-placed plaque at an adjacent building, a hotel. In the reception area it in part reads "Vaiaku Lagi Hotel, Republic of China presented to Government 1993 by H. E. Hugh H. O'Young ambassador extraordinary and plenipotentiary of the Republic of China to Tuvalu".

Many visitors misinterpret the gift as having come from mainland China. But the locals have no doubts as to where the money comes from. The Taiwanese ambassador Dr Feng Tai says his country has been giving aid to Tuvalu ever since the two formed full diplomatic relations around 26 years ago, shortly after the former British colony gained independence in 1978.

This year it gave about A$4 million cash. "Only Taiwan gives cash ... we are the only country in the world to do so."

But Tai insists no money is given under the table. "I've been ambassador here one year and seven months ... I guarantee that - none to politicians - my Government would not allow that."

Tai counts off all the aid such as for medication, education scholarships, dental treatment, ship upgrading, and agriculture. The latter, in the form of a demonstration farm, he is particularly proud of.

Tai says Tuvalu, with its poor soil and high temperatures, struggles with horticulture and the locals subsequently lack a balanced diet.

"New Zealand, Australia and the United Nations tried before and failed, but Taiwan was successful. We showed they can plant 29 different kinds of vegetables and fruits."

The Tuvalu Government's acting director of planning, Letasi Iulai, says its aid from Taiwan has to be accounted for but there are no guidelines. "The Government can just use the money where it likes ... no strings attached."

But Iulai says core funding from Taiwan is paid in two instalments, and before the final instalment is paid the Government has to provide a progress report on how the first was used. Examples in 2005 included US$585,000 on shipping fuel, US$300,000 on a medical treatment scheme and US$200,000 for medical supplies, and a US$80,000 grant to Tuvalu Media Corporation.

Tuvalu also receives aid from Australia, New Zealand, the European Union and smaller amounts from France, Germany and various multilateral organisations.

Silafaga Lalua, editor of monthly newspaper Tuvalu Echoes, says there have been "quite a few problems" with aid money from Taiwan.

For instance money for projects on the outer islands never reached them as the Government diverted it to meet its revenue shortfalls.

"They have a habit of borrowing money to meet needs."

After many complaints she says Tai went to the islands and decided to directly send money to them.

Strains between Taiwan and China last year saw Prime Minister Saufatu Sopoanga lose power in a no-confidence vote after he made an unauthorised trip to Beijing.

Lalua says everyone was angry with him for "putting the country at risk" by taking the trip without consulting colleagues."He didn't follow protocol ... he made a big mistake."

Opposition member and a former Prime Minister, Latasi Kamuta, says it is not normal when a country recognises Taiwan for its Prime Minister to all of a sudden depart to Beijing.

As Tuvalu's first High Commissioner in Fiji after independence, Kamuta fielded approaches from China and Taiwan's representatives.

But he said it was really a foregone conclusion to recognise Taiwan as under Tuvalu's constitution; it could not have any diplomatic relations with communist countries.

"That's the main reason we did not recognise mainland China ... it's not that we were bought by money. Right from the outset we could do nothing about it."

Tai, who only refers to China as Beijing, admits there is no doubt of their serious competition in the Pacific but strongly denies Taiwan's involvement in Sopoaga's downfall.

Tai says Sopoanga eventually apologised to the Taiwanese President for "making a mistake" when he next visited the country.

Tai adds he is "very shy to say so" but Taiwan does not pay lip service like Beijing, which does not keep its promises. And he does not just reserve his ever-so-polite critique for China.
Tai confesses he has "a little criticism" of the New Zealand Government.He calls New Zealand a friendly and democratic country which follows one-China policy.

It also enjoys a good trade relationship with Taiwan and a lot of Taiwanese emigrate to New Zealand.

"But your country must respect any individual sovereign state to conduct their foreign affairs and diplomacy ... Sometimes your country criticises Taiwan for establishing diplomatic links with some countries in the region.

"We feel it is a little unfair, we feel uneasy, uncomfortable."

Tai gives a little self-conscious laugh as he points out how Taiwan shares the financial burden of supporting countries like Tuvalu. "New Zealand and Australia think the Pacific is their big garden but the world is a global village ... There is no harm to New Zealand for us to keep diplomatic links," he laughs.

* Angela Gregory's visit was sponsored by the Pacific Co-operation Foundation