Fiji coup spells danger for South Pacific region

By Belinda Goldsmith

CANBERRA (Reuters): If Fiji's democratically elected government is pushed out, analysts see serious political and economic repercussions for the South Pacific, where ethnic tensions are running high and weapons plentiful.

It could cast a shadow over future investment in the region, and raise questions how Australia should handle a crisis in its backyard.

Although political turmoil is no stranger to the region's 13 island nations, only twice in the post-colonial era has democracy come under threat -- on both occasions in Fiji.

Political analyst Greg Fry at Australian National University saw a dangerous precedent if Fijian authorities caved in to coup leader George Speight, who has held ethnic Indian Prime Minister Mahendra Chaudhry hostage for more than a week and claimed power on behalf of indigenous Fijians.

"If it (the coup) were to succeed, by gaining the support of prominent Fijian leaders, this would give encouragement to those who wish to overthrow democratic government," Fry told Reuters. "This would spell disaster for the region."

Before Speight's armed gang stormed parliament recently, Fiji, the South Pacific's regional hub, looked set for a period of economic prosperity after two military coups in 1987 scared investors and sparked an exodus of Indian professionals.

Chaudhry's government won power in a general election last May and its demise, if supported by the authorities, would put the nation back several years, hitting tourism and isolating Fiji from the international community.

Fry said toppling a democratically elected government and adopting a racially based approach to government had wider implications for the South Pacific, where most people still eke a subsistence existence.

"There is a general sense that if Fiji is in trouble, then the region is affected," Fry said.

The international community has warned Fiji not to break from its democratic constitution, with threats to suspend Fiji from the Commonwealth, cut off aid and look at measures to restrict trade and participation in international sporting events.

While expulsion from the Commonwealth and sporting sanctions would not hurt the living standards of ordinary Fijians, it would humiliate the leadership.

But analyst Robert Norton from Sydney's Macquarie University said trade sanctions and stopping aid, such as to the main university, would hit particularly Fiji's garment industry as the country had an agreed sales quota with Australia.

"The garment industry in Fiji employs about 15,000 people, mainly young women, and although the wages low the employment is significant," he told Reuters.

Another expected exodus of ethnic Indians if indigenous Fijians seize power would also hurt, with the loss of a skill base. From the 1987 coups to the mid-1990s, about one in seven of the Indian community left Fiji.

Neighboring countries, already beset with their own ethnic and land problems, were closely watching Speight's attempt to put indigenous Fijians back in power by pushing aside the Indian minority, which makes up 44 percent of the 800,000 population.

The Solomon Islands has a similar problem, with armed militants from the main island of Guadalcanal fighting to drive out rivals from Malaita island, resentful of their success in business and politics in the capital Honiara.

Up to 60 people have been killed in the past 18 months in clashes between rival ethnic groups armed with a motley selection of guns and using ammunition left behind after World War II.

Beheadings and evictions have fueled the anger, but no attacks have been made on the government. More peace talks are planned for coming weeks.

"The issues are the same in each country. It is the difficulty of an indigenous community coping with the demands of the modern world. Those who succeed become targets of violence," said Brij Lal, a Pacific expert at the ANU.

Ethnic tension is nothing new to Papua New Guinea (PNG), home to four regional groups of people and over 700 languages. It was brought to the edge by a secessionist rebellion on resource-rich Bougainville in 1989, prompting the national government to pull out completely from the island. It remains largely out of bounds.

The proliferation of weapons in PNG and urban drift by youths alienated from the subsistence lifestyle in rural areas has caused serious problems in major towns, particularly the capital Port Moresby, where criminal gangs known as "Raskols" operate freely.

Although the problems of South Pacific nations differ to some degree, one similarity is the challenge faced by their emergence from the colonial era.

Freed from colonial bonds in the 1970s, many new Pacific governments took a controlling stake in their economies in the 1980s, with much of the investment reliant on foreign aid.

By the 1990s many of the economies faced fiscal deficits and found the gap between rich and poor widening -- often to the detriment of the indigenous population, which sparked resentment of successful newcomers.

Stewart Woodman, a senior fellow at the Australian Defense Force Academy, said the recent crises indicated the honeymoon period for the South Pacific since independence was over.

"At independence, they received substantial advisory and material assistance to establish the structure of nationhood. They were expected soon to establish the political and economic maturity to complement their new-found political states," he wrote in an analysis.

"Thirty years on, that vision appears to have been a castle built on sand."