Pacific Notes
Pacific Notes
| Region Abramoff Scandal Reaches Pacific When Jack Abramoff was the top lobbyist in Washington, it wasn't only major U.S. corporations and Native American Indian tribes that lined up for his deal-making services. The governments of the Northern Mariana Islands, Guam and Marshall Islands, the Guam Superior Court and the garment industry on Saipan paid top-dollar to get Abramoff and Abramoff-related firms in Washington, D.C. pushing their interests.
But in early January-after an 18-month federal investigation-Abramoff pleaded guilty to conspiracy, tax evasion and mail fraud, admitting that he corrupted public officials and defrauded his own clients out of $25 million. The scandal has rocked Washington, D.C. The federal government investigation into Abramoff helped force powerful Republican Rep. Tom DeLay to step down as the majority leader in the House of Representatives; Abramoff has agreed to tell the FBI about alleged bribes to as many as 20 members of Congress and aides; and the powerful D.C. lobbying firm Alexander Strategy Group, which had close ties to both Abramoff and DeLay, went out of business at the end of January because of the scandal. Fallout from Abramoff's prosecution has yet to seriously hit any officials in U.S.-affiliated islands. But Allen Stayman, a former U.S. chief negotiator in Compact of Free Association talks with the Marshall Islands and Federated States of Micronesia, and now staff to U.S. Senator Jeff Bingaman, says the close ties of the Northern Marianas with Abramoff will make it harder "to get things done in Congress" reported the Marianas Variety in late January. Fitial considers Abramoff a personal friend who was hired by former Governor Froilan C. Tenorio and continued under Governor Pedro P. Tenorio to lobby on behalf of the CNMI to ward off U.S. federal takeover of its labor and immigration departments, which would have had a devastating affect on the local economy. However at the end of January, Fitial revealed that he may file a lawsuit demanding "full restitution" of the millions of dollars paid to two Washington D.C. law firms connected to Abramoff, Preston Gates and Greenberg Traurig. In a letter sent to the firms and reviewed by Pacific Magazine, Fitial alleges illegality, and says the"Commonwealth is arguably in a worse position now" due to the two law firms' association with Abramoff. Published reports say that Abramoff was paid anywhere between $7 to $10 million by the CNMI government. The garment industry on Saipan also paid heavily for Abramoff's services to protect the right of the CNMI government to control immigration that allowed for thousands of Asians to come to Saipan to work in the garment factories. DeLay, who visited Saipan on Abramoff-organized trips, was a key opponent of any federal takeover of CNMI's immigration operation. Reyes says it is "unfortunate" that the reputation of the Northern Marianas is being "tainted" by media reports in the Abramoff controversy. "We're concerned about (allegations) of illegal activities on the part of CNMI government officials because the government was legitimately engaging in lobbying to protect our labor, immigration and the garment industry," he says. "Everyone uses lobbyists," Reyes told Pacific Magazine. "It's part of the democratic process." Until something changes dramatically in the wake of the Abramoff controversy, the CNMI will continue to use professional lobbyists to represent its interest in Washington, he says. In Guam, the Superior Court in 2002 hired Abramoff to work to kill U.S. legislation that would have made the Supreme Court the highest court on the island. The Superior Court paid Abramoff $324,000 through attorney Howard Hills, who also works for Rongelap Atoll in the Marshall Islands. Hills told Pacific Magazine that the $324,000 was simply turned over to Abramoff at the request of the Guam Superior Court. "Every action I took was at the request of the presiding judge and the court staff," Hills says. A recently published Guam audit of the court criticized the deal between the court and Abramoff, with Hills as a conduit, in large part because all of the checks were for $9,000, which the audit says appeared to have been done "to circumvent the sealed bid requirement" for contracts over $10,000. But the Guam audit report also says that legal services did not fall under the Superior Court's procurement policy that required public advertisement and competitive bidding for contracts over $10,000. "The decision to hire Abramoff was the court's and I had no involvement in what Abramoff did," says Hills, who worked for the Superior Court for about four years prior to the 2002 hiring of Abramoff. Hills said that nearly two years ago, when allegations about improper conduct by Abramoff first surfaced, "I went forward to U.S. congressional staff. I've been cooperating fully and continue to cooperate because the facts and truth are my allies." The Marshall Islands hired Jack Abramoff-related legal and lobbying firms in the late 1990s and again from 2003-2005 in an effort to get a boost first in Compact negotiations and later in congressional approval of the Compact. But the Marshall Islands ended up paying large amounts of money, facing a lawsuit in a payment dispute and getting mixed results for its investment in DC lobbyists. Then President Imata Kabua's administration, in 1998-1999, hired Preston Gates, a major Washington law firm that Abramoff was working with. Later, under President Kessai Note's administration, the Marshall Islands hired Alexander Strategy Group, also an Abramoff-affiliated lobbying firm that is now going out of business because of the scandal surrounding Abramoff's illegal lobbying work. When the Note administration came into office in 2000, it was presented with a bill for Abramoff's services of between $400,000 and $600,000. When the Marshall Islands balked at paying, Abramoff's law firm sued. The case was settled when the government paid Preston Gates about $250,000, says Foreign Minister Gerald Zackios. Zackios said the hiring of Republican-aligned Alexander Strategy Group (ASG) was done after a review of proposals from competing firms, and included the hiring of the Harbour Group, which was Democrat-focused, giving the Marshalls a bi-partisan approach to lobbying for improvements to the Compact of Free Association that was then being considered by the Congress. The Marshall Islands paid $584,739.58 to the firms for about two and a half years of work. Although ASG went out of business in January because of its close ties to Abramoff, Zackios is adamant that the Note administration has not been dealing with Abramoff. "The present administration has not had any dealings with Mr. Abramoff since it took office in 2000 other than cleaning up the unpaid bills left by the prior Marshall Islands administration owing to the firm of Preston Gates, and settling a lawsuit brought by Preston Gates against the Marshall Islands," Zackios says. The Marshall Islands terminated its contract with ASG last October according to Zackios, who adds, "We did this not knowing that Abramoff's (situation) would have had implications on the firm closing its lobbying business." -- Giff Johnson with additional reporting by Frank S. Rosario Solomon Islands The National Bank of Solomon Islands posted an operating profit after tax of over US$1.8 million in 2004, and another $1.8 million the previous year despite problems over its ownership. Shareholders have not been paid a dividend since 51 percent of the bank's shares, which used to be owned by the Bank of Hawaii, were placed in the care of three separate trustees in 2002. Bank of Hawaii could not find a buyer for it shares at the time it pulled out of the Solomons. Two of the trust accounts are supposedly set up for the education and health of Solomon Islanders. One is for the benefit of bank's employees who are challenging in court the authenticity of the trust deed. The balance of shares is owned by the Solomon Islands National Provident Fund. Finance Minister Peter Boyers had sacked the former board of directors of the Fund for among other things, challenging the legality of the trusts in the High Court. A new board of directors was appointed, and the case was withdrawn. Boyers stressed the need to resolve problems over the ownership of NBSI to be able to pay dividends to shareholders. -- Alison Ofotalau Nauru Taiwan looked posed to bail out Air Nauru in February, after the airline suspended services at perhaps the worst possible time for its passengers, just before Christmas 2005.
Nauru's Minister for Civil Aviation is hoping that Air Nauru would be back to full services in the first quarter of the year. Dr. Kieren Keke says the government is finalizing an offer it will present to America's EXIM bank in an attempt to buy back the plane repossessed in December. "Nauru's reliance on a regular air service is essential to assist the national development programs, and this was understood by our friends in Taiwan. Their response to our request for help is appreciated by the government and people of Nauru," Minister Keke said. However in early February EXIM Bank was seeking cash offers for the repossessed Boeing and refuted media reports that it was in negotiations with Air Nauru to purchase the aircraft. Details of the assistance offered by Taiwan were expected to be formalized in mid-February. The recent troubles followed the court-ordered repossession of Air Nauru's only Boeing 737 because the government had not made repayments on the plane since 2002. The High Court in Melbourne refused to grant Nauru special leave to appeal against the Victorian Court of Appeal decision directing that the aircraft be handed over. "EXIM Bank appreciates the difficulties that the court's decision presents to Air Nauru and the Government of Nauru. However, this action follows numerous unsuccessful attempts to negotiate a resolution and is now unavoidable in order to protect the interests of U.S. taxpayers," a bank statement at that time said. The demise of services saw Air Pacific, Air Vanuatu and Air Marshall Islands step in to service portions of the Brisbane-Fiji via Honiara, Tarawa and Nauru route, although Air Nauru has continued to provide weekly charter services. Kiribati was reported to be discussing a more permanent arrangement with Air Pacific, which started to fly to Christmas Island in October. Air Fiji has also expressed interest in the route. -- Samantha Magick Papua New Guinea Violence perpetrated by officers within the Royal Papua New Guinea Constabulary (RPNGC) is increasing the risk of HIV transmission within PNG, a global human rights report has warned. The World Report 2006 released by Human Rights Watch in January slammed the constabulary for using violence against individuals kept in police lockups, especially children, women and girls. The report said research conducted in PNG last year-the first time the New York-based organization did a survey-included testimonies from detainees who report being beaten, shot, burned, knifed, gang-raped and forced to have sex with others. Police brutality targeting sex workers and homosexuals was increasing the risk of HIV transmission, the report warned, as the victims were going underground and shying away from lifesaving information on HIV prevention and health services. Says the report: "Public shaming of sex workers as 'AIDS carriers' prevents people from seeking HIV-related services for fear of being stigmatized. Police continue to harass persons possessing condoms, including forcing individuals to chew and swallow condoms and their plastic wrappers. Such responses deter condom use and undermine desperately needed HIV/AIDS prevention work by NGOs and the government." Human Rights Watch says government institutions outside of the RPNGC that could be effective in stopping the violence-the Public Solicitor's office, Ombudsman Commission, and civil claims against the State-were toothless to act. "At police stations, detainees are held for weeks or months in squalid conditions that violate basic international standards. Police typically provide no medical care even to seriously injured detainees. In some stations, detainees lack bedding and sufficient food and water. Children routinely are mixed with adults in police lockups, even where separate cells are available," the report says. Describing violence against women and girls as pervasive, the report said police often ignored complaints of sexual and domestic violence and asked victims for sex instead of providing assistance. Girls' and women's low status in PNG society contributed to their discrimination in education, health care, access to employment and being subject to laborious household work and polygamy. The report decried the government's failure to prosecute policemen who beat and gang-raped women and girls who were suspected of prostitution during a raid on a Port Moresby brothel in March 2004. Police shooting of a group of students close to the Porgera gold mine was also highlighted, although the report acknowledged that two RPNGC officers were already charged over the incident. While inroads were made by the government to set up a juvenile justice system with strong support from the United Nations Children's Fund (UNICEF), the report says failure to hold police accountable for implementing newly created juvenile processing guidelines and perpetrating violence against children threatened to undo the positive developments. --Alex Rheeney Tonga Tonga officially became the 150th member of the World Trade Organization (WTO) on December 15, 2005. However, this didn't come without some criticism, not least from the international non government organization OXFAM, which said Tonga has been forced to give up more on tariffs than any other party to the WTO bar Armenia. In a briefing note titled "Blood From A Stone," Oxfam said "many of the terms extracted from Tonga are of no benefit to its people--for example, changes to the intellectual property regime--and will cost a lot of money to implement, money that will not be available for Tonga's development needs." Tonga's Labor, Commerce and Industries Minister Dr. Fred Sevele rejected Oxfam's criticisms as "outrageous," "nasty" and "erroneous." A government statement said Oxfam's claim was based on "emotional ignorance rather than on a true understanding of the realities of the Tongan situation," and that reduction in tariffs was in line with the government's own policies. The accession comes as Tonga's Finance Minister Siosiua T. T. 'Utoikamanu said the Kingdom's economic situation was grim. "What we are facing is similar to a cyclone coming our way and it is only a matter of time before it hits. However, prior warning will help citizens to brace themselves and put up the shutters before the storm hits. This is what I am doing and is an essential part of my role as Minister of Finance." He attributes the economic problems to the recent public servants pay settlement and has warned tax increases may be on the way. Meanwhile, in Hong Kong, trade ministers accepted an agreement that incrementally advances long-stalled World Trade Organization (WTO) negotiations but left the most politically difficult decisions for later this year. Tonga joins five other Pacific Island countries in the WTO. Samoa and Vanuatu are yet to complete their ratification instruments and Tuvalu and Niue were in Hong Kong as observers. Pacific Islands Forum Deputy Secretary General Peter Forau welcomed the slight compromises made in Hong Kong, but said a major disappointment was the failure to support the adoption of the Small Economies Work Program. It will be considered again in December this year, but Forau says "this is not progress but an attempt to delay adoption of the Program." "Judging by what is happening in other parts of the WTO membership, it does seem logical that the Pacific Island country WTO members should not embrace trade liberalization just for the sake of responding to the pressures of the multilateral trading system but must do so after careful determination that doing so is in the best interest of the PICs," Forau says. -- Samantha Magick
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