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We need to understand
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09 October 2019
Author 
Seth Gukuna.


By SETH GUKUNA

West Honiara


THE decision taken by our Government for this country to switch to China was based on the cabinet paper that Cabinet endorsed on September 16th 2019. 

      In that paper our Ministers would have been given the reasons as to why this country needs to move to China. 

That same paper should have also gave them the reasons as to why we must leave Taiwan for the sake of this important issue being given a fair hearing in Cabinet.

      That particular cabinet paper as well as all other cabinet papers is Confidential Properties of our Cabinet Office for the honourable reason that cabinet decisions are prerogative of Governments.

      The true reasons for our switch to China are in that cabinet paper which Cabinet endorsed on September 16th, not what we have been producing for public consumption in the press and the social media, not the justifications that are being put out in public statements and not even what was discussed in government caucus.

      Last Tuesday your paper printed a full page of an article containing reasoning and personal adorations for this Government to back a call for the public to understand the decision taken by our Government for us to move to China.

      Given that cabinet papers are confidential, I doubt that the content of that article were lifted out of that cabinet caper. 

But, should the article in fact reflected the content of the cabinet caper, then in my opinion, that cabinet paper was not sufficient to help Cabinet reached an informed decision on the issue unless the decision was predetermined.   

      No one questions the sovereignty of our Government, nor its prerogative to make such decision. 

Our concern is that the decision to switch was made in haste and that our Government appears to have been coerced into that decision.

      Some of us are concerned about the damages that the inevitable soft-loans will cause to our fragile economy. 

Already our first soft-loan is on the way and should it flops the damages it will cause to our economy would be substantial, we are concerned that the advices of our Central Bank, the country’s authority on banking and financing matters were not considered.

      Some of us are more concerned that our Government has not been forthcoming in its dealings with this decision and public’s expressed opinions. 

This is not how the sovereign Government of the people should act. I agree with the article that had the Government used the media more, may be the public would be more understanding.    

     What intrigued us was the hurry in which the Government had handled this important Taiwan-China issue and the speed in which China responded to the switch with our first soft-loan. 

Clearly, these had already been agreed on and Cabinet was merely convened to rubberstamp an important foreign relations decision that had been made elsewhere.

     This leaves some of us to question the validity of this decision as it is clear that the constitutional duty of our sovereign Cabinet to decide whether to switch to China or not was deliberately undermined.       

      We believed that the switch to China and the announcement of our first soft loan were timed to happen as part of the 70th Anniversary of communist China which falls last week. 

In fact, it was rumoured that China had wanted to give this country a gift on its big day should we switch in time.  

      What is sad is that this country gave China the perfect birthday present it had wanted all these years while China in return gave us a mighty debt trap. 

      Despite how it is being explained, it is clear that China had actually presented us with what the pro-Chinese had wanted all along; soft-loans. 

It is also clear that this country and Taiwan have been sold for soft loans yet the article did not mention capitals as our main reason for moving to China.

     In fact, the article did not discuss any direct benefit to this country as a result of moving to China other than the need to affirm our connections with MSG and the UN. 

Given such a high stake issue, it is not good enough to call for public understanding based on personal liking for this government.

      But as far as government decision making is concerned, this issue is truly over it is now water under the bridge. 

I can also appreciate that the article that your paper published last Tuesday was mere PR material only good for public consumption. 

      But if the reasoning in the article were from that pro-China report may be the author of the article can also tell us who actually authored that report. 

And while we are on this trail, some of us are more interested in the actual content of that cabinet paper; it is the arguments and reasoning in it that we want to know.

      Few of our ministers have been removed for not agreeing with the content of that cabinet paper; any other cabinet paper would not invoke such mass sacking. 

      What is striking is that with our switch to China, our sovereign Government suddenly behaves like a communist government purging opposition and dissents in order to command explicit obedience to China in cabinet, the exact techniques used by real communist governments to protect their agendas and suppress their own people.

     We want to know whether the removal of ministers is part of the conclusions to the cabinet paper that Cabinet endorsed or this simply played into a new mood for communism. 

We now fear that the cabinet paper may have also directed our government to also switch our democratic system to communist style.

     Now that we are taking steps to understand our situation, it is vital that we also understand the macro-effects of our first soft loan on our economy. 

     We should take particular note that once this loan comes into effect, our debt to China will rise from 0% to account for 63% of our GDP and 85% of our total domestic and foreign debts, our total debt to GDP ratio will increase from 11% to 74%, our total debt will increase by 573%, debt repayment will increase by 645% and debt burden on our budget will go up to 12% from 1.5.

     The 10.5% extra burden on our budget is due to the $387m that our government would have to divert from funds appropriated to other heads in our national budgets to meet the repayment costs of our first soft-loan. 

Citizens of some countries around the world are rioting and burning their streets due to such austerity measures.     

Should the investment deal goes well, the effects of this loan may be minimal but in the event that it failed to go as planned, the effects on our economy will be devastating.

     These figures render our government hardly a safe investable asset and if China cares and if we are to use our common sense, we cannot afford to look for a second soft-loan; the damage may have already been done and the more soft-loans we take in, the bleaker our prospects becomes. 

     As the Government now takes steps to have our public understand its recent actions, perhaps it could also explain its take of the macro-effects of our first soft-loan and how it plans to mitigate them should the deal did not work out as expected.

 

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