Saturday, November 17, 2012

X-Post: Island Business - Pacific Next Battleground for Superpowers

Source : Islands Business


‘Many of the Pacific Islands countries have already cast their lot with China and by extension most things that China has to offer, including telecommunication technologies. If the standoff between the west and China on the issue of telecommunications security continues, it could quite easily lead to a trade war or even worse, if wiser counsels don’t prevail. On its part, China will have to be forthcoming on opening its doors to western scrutiny’

Political observers in recent years have often discussed the possibility of the Pacific region turning into the next battleground of the superpowers. The obvious reasons for their speculation are the race to increase the superpowers’ influence in a bid to establish geopolitical hegemony in the world’s largest single geographic feature and to gain access to the substantial natural resources that lie within the sovereign boundaries of islands nations—big and small—that dot the region.

In the past few years especially, the world’s superpowers have made announcements about their plans for the Pacific islands region with greater vigour and frequency and followed them up with firm action. For instance, the United States has followed the People’s Republic of China’s many initiatives to build up its diplomatic presence in the islands with bigger embassies and more personnel, as well as new assistance programmes.

Given these developments, some regional developments, particularly such as those in Fiji, have changed the complexion of geopolitics in the region with the Pacific islands’ long-time allies New Zealand and Australia having serious competition from around the world for the attention of islands leaders over the past few years. This is borne out by the fact that there has been a lengthening beeline of countries from around the world at successive annual forums of Pacific Islands leaders over the past few years. Earlier this year, international geopolitical analysts and experts even said that the next arms race might well take place in the Pacific, what with the United States waking up to the fact that China had made great progress in extending its circle of influence around the islands region while it was busy waging pointless wars in the Middle East for more than a decade.


The conspiracy-minded among analysts find the Pacific an excellent place for the superpowers to kick-start an arms race with a view to reviving their global financial crisis-ravaged economies. The Pacific also seems attractive for believers of this line of reasoning because of the relatively low potential for collateral damage.
While all these scenarios lurk on the edge of possibility, it is equally possible that the next big conflict might be triggered by completely different factors: trade and technology, for example. And even then, the Pacific Islands region might still have to bare the brunt of the pain. A taste of how this might pan out began to unfold earlier this year and reached fever pitch last month in several countries around the world but most notably in the United States and Australia.


At the centre of the controversy is Chinese telecommunications giant, Huawei, which has a presence in nearly a hundred countries around the world including many of the Pacific Islands. While it is not primarily a telecommunications service provider, it has grown to become one of the world’s biggest suppliers of information and communication technology (ICT) hardware and systems in the world.



Islands Business: We Say


"[S]ome regional developments, particularly such as those in Fiji, have changed the complexion of geopolitics in the region with the Pacific islands’ long-time allies New Zealand and Australia having serious competition from around the world for the attention of islands leaders over the past few years "
The United States House Intelligence Committee has classified Huawei as a security threat because of a number of reasons ranging from the fact that it was formed by a former Chinese military official to rumours that it is actually financed by soft loans from the Chinese government to the tune of some US$30 billion. There is even belief in some quarters that it is an arm of the Chinese government. There are fears that Huawei’s equipment, when plugged into a country’s network, can transmit sensitive data back to its masters in China.

While there is no evidence this has happened, the fears have spread to a number of nations where Huawei either has already bid or is in the process of bidding for billions of dollars worth of projects to establish and upgrade broadband networks. These range from Canada, the United Kingdom, several countries in Europe and Australia, which also has said it would bar Huawei from bidding for its nation-wide fast broadband network.


One of the few western nations that so far has not made any noises is New Zealand where the company has had a far deeper presence than Australia. Much of the hardware used by cellphone companies in New Zealand is Huawei’s. The company has also bid and partnered with an indigenous business group to provide a link between Australia and New Zealand—which will be up in the air if Australia sticks to its guns and prevents Huawei or its constituents from tapping into its network in Australia.


A couple of months back, Pacific Fibre—co-promoted by New Zealand millionaire and founder of well-known auction website TradeMe—which sought to connect Australia, New Zealand and the western United States fell over, citing its inability to raise some $400 million to complete the project. Such a figure is not an insurmountable one in international ICT projects of this scale.


Speculation is now rife that the reason for the falling over could well have been the refusal by both Australia and the United States to terminate the undersea cable at both ends because of the heavy involvement of Chinese companies in the project. This raises the question whether countries that align themselves with Chinese technology companies, especially in the ICT space, will be disadvantaged because of the paranoia—justified or not—of several western countries ranging from the United States to Australia. Most Pacific Islands nations like New Zealand have opened their arms to cheap technologies that Huawei and companies like it offer. That is one of the reasons why telecommunications and data tariffs have continually fallen in New Zealand and many countries of the region.

Will these mean they will have difficulty in aligning with western economies? Simplistic as it might look, the problem has the potential to blow into a crisis, especially if the security threat perception escalates for any reason. In any case, cyber attacks on government websites as well as utility networks have been on the increase and there has been general agreement in the western world that such attacks can be traced to Chinese sources. Some sources have gone to the extent of contending that these may even be sponsored by the Chinese state. Many of the Pacific Islands countries have already cast their lot with China and by extension most things that China has to offer including telecommunication technologies. If the standoff between the west and China on the issue of telecommunications security continues, it could quite easily lead to a trade war or even worse, if wiser counsels don’t prevail. On its part, China will have to be forthcoming on opening its doors to western scrutiny.

So whether it is for geopolitical hegemony, the race for natural resources or the tug of war over communications technology, the Pacific and Pacific Islanders will soon find themselves at the epicenter of developments. And there is little they or their leaders can do about it.



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