The escalating political crisis in Sri Lanka which, amid a catastrophic economic crisis has seen forced resignations of the president and prime minister, is generating growing concern among ruling classes around the world about the dangers of the emerging global class struggle.
A mass movement of the Sri Lankan working class and rural poor has erupted against the social and economic breakdown devastating living conditions of the masses. The explosion of popular anger over the past three months saw more than a million people descend on the capital, Colombo, on July 9 in defiance of government emergency orders and threats of mass repression.
In response to the crisis, New Zealand’s foreign minister Nanaia Mahuta in a recent television interview sounded the alarm, amid sharpening geopolitical tensions, about high debt levels and potential unrest in the Pacific.
The interview aired on TVNZ’s “Q+A” program on July 17, shortly after Mahuta had returned from the Pacific Islands Forum (PIF) in Fiji. At the forum, US vice president Kamala Harris announced an escalation of US involvement across the region, aimed at ramping up the strategic, economic and military encirclement of China.
Mahuta’s “concerns” about the way Pacific development has been funded singled out China for criticism. “I’d say there's a level of indebtedness that sits across the whole of the Pacific to financial institutions, including the way in which China has funded into certain countries,” she said. The minister described Pacific debt as a “key area of vulnerability that should be addressed.”
Asked about the “lessons” from Sri Lanka, Mahuta declared that “the point at which Sri Lanka has reached its political unrest because of economic vulnerability is something we should be concerned about and is something that can be considered in relation to the level of economic vulnerability across the Pacific.”
Mahuta said the New Zealand government was hopeful of a “peaceful way of resolving the [Sri Lankan] situation,” via elections for a new president and prime minister, and that the “constitutional arrangements will provide some guidance for that.”
The 1978 constitution, however, is fundamentally anti-democratic, giving the president vast autocratic powers. Parliament has now installed the widely despised Ranil Wickremesinghe in order to ruthlessly impose the austerity dictates of the International Monetary Fund and strangle the popular uprising.
Mahuta emphasised that New Zealand’s military “stand ready and willing to respond very quickly to natural disasters [and] civil unrest” should it erupt in the Pacific as it has in Sri Lanka. She pointed to the way in which New Zealand, Australia, Fiji and Papua New Guinea (PNG) responded “with a level of urgency” to last year’s deadly anti-government riots in the Solomon Islands.
New Zealand’s Labour-Green government ordered police and troops to join an Australian-led intervention in the Solomons. Days of rioting in November claimed three lives and left much of Honiara, the capital, in ruins. These events were not a genuine mass uprising but were pre-planned by US-backed opposition forces and aimed at removing the government of Prime Minister Manasseh Sogavare and reversing its diplomatic recognition of China.
New Zealand troops joined a force of over 200 led by Australia, purportedly to “maintain peace and security.” After Sogovare subsequently invited a contingent of Chinese police to train the local force, Canberra and Wellington maintained their own military presence in Honiara. The NZ government announced it will extend its deployment there until next May.
For many years, New Zealand’s military has been openly training for interventions to “restore order” in Pacific countries, including in its biennial multi-national Southern Katipo exercise.
In her interview Mahuta talked up the defence and security relationships New Zealand currently has with Pacific countries, suggesting that military capabilities could be increased. “In terms of maritime surveillance, there’s a lot of conversation… [about] how more could be done, and an integrated approach towards maritime surveillance because of illegal, unreported fishing activities,” she said.
Mahuta also added, “It could mean drones. It could also mean extra maritime support, as well as aviation support as well.” So-called “illegal fishing” invariably refers to China’s fishing fleet.
Defence Minister Peeni Henare said last week that with “what’s happening in the Pacific,” investment in military hardware had to continue, plus support for exercises such as the current US-led Rimpac exercise off Hawaii. Labour has dramatically increased defence spending from 1.15 to 1.59 percent of GDP and committed an additional $20 billion over the next decade.
Mahuta pointed to the Biketawa Declaration as a purported example of “regional co-operation.” Signed in 2000 following pressure from Australia and New Zealand, the document jettisoned a long-standing principle of non-interference in the affairs of PIF member nations. It established that “in time of crisis,” including when countries face “threats to their security, broadly defined,” this can trigger diplomatic, economic and military intervention anywhere in the region, at the behest of the major powers.
Mahuta’s comments further expose the fraud that New Zealand represents a “kinder” and more “independent” foreign policy approach in the Pacific, compared with Australia and the US. Speaking to the Lowy Institute this month Prime Minister Ardern hypocritically declared that her government was opposed to the militarisation of the region, declaring “diplomacy must become the strongest tool and de-escalation the loudest call.”
New Zealand has been a colonial power in the region for over a century. While pursuing its own interests, it has always relied on one of the major imperialist powers—first Britain, and later the US—to maintain its strategic position. Involvement in wars, including support for the US-NATO war against Russia in Ukraine, are the quid pro quo for support for NZ operations in its own “back yard.”
Mahuta, who is Māori, has been promoted on the basis of racial identity politics, so that the Labour government can posture as “family” to indigenous Pacific peoples. In a speech to a Māori and Pacific audience earlier this month, Mahuta cited “values unique to us,” which, she claimed, reflect a “Māori perspective that is relevant beyond our shores.” The list included such virtues as “kindness,” “care,” “reciprocity” and “common humanity”— i.e. “human rights” buzzwords that the US exploits to justify its wars and regime-change operations around the world.
Mahuta’s allegations of “debt trap diplomacy,” are parroting Washington’s propaganda amid its anti-China diplomatic offensive. At a Pacific leaders’ conference in Hawaii in June 2021, US Secretary of State Antony Blinken angrily declared that China was breaching “international standards” and using “economic coercion” in its provision of aid and concessional loans.
The allegations are bogus. In 2019, 67 percent of Chinese aid to the Pacific was given in the form of loans, mainly for infrastructure projects, up from 41 percent the year before. Pacific leaders, however, often prefer China’s funding over that from Australia and New Zealand, saying it comes with fewer strings attached.
Seven low-income Pacific Island countries—Kiribati, Marshall Islands, Micronesia, PNG, Samoa, Tonga and Tuvalu—are classified by the IMF and World Bank as at high risk of “debt distress.” However, according to an Australian Broadcasting Corporation (ABC) report on July 10, based on World Bank data, most of the Pacific's external debt is with multilateral agencies as opposed to bilateral creditors.
The Asian Development Bank is the major creditor for Fiji, Samoa, Solomon Islands, Tonga and Vanuatu, holding about 38 percent of all external debt, followed by China (22 percent), the World Bank (13 percent), and Australia and Japan (6 percent). Chinese loans account for less than half the total in the region’s two largest countries, PNG and Fiji.
The ABC report warns that trade deficits and high debt levels may lead Pacific governments, without vastly increased financial assistance, to adopt deeper austerity measures “likely to worsen poverty and inequality in the region and undermine economic recovery.” Far from addressing the looming social disaster, the local imperialist powers, Australia and New Zealand, are preparing to intervene and suppress the inevitable popular discontent.