New Zealand says Fiji Economy Near Collapse as Military Strengthens Grip

By Phil Mercer

Sydney
15 April 2009

Fiji's military ruler accuses judges of trying to force him to call
elections. But since the judiciary was dismissed and the constitution
was scrapped by the government last week, the country's weak economy
has suffered more.  

In his first interview with foreign media
since a state of emergency was imposed last week, Fiji's armed forces
chief Commodore Frank Bainimarama indicated that the three Court of
Appeal judges who ruled against him were biased against his government.

Military chief dismisses judiciary

The
court ruled that his 2006 power grab was illegal, prompting Fiji's
president, a close ally of Commodore Bainimarama, to scrap the
constitution and dismiss the entire judiciary.

This allowed for
the return of the military administration, which is now in a far more
powerful position than it has been since it ousted an elected prime
minister in December 2006.

No press freedom

The media is being censored, foreign
correspondents deported, and critics of Commodore Bainimarama have been
arrested or dismissed from their positions. The military has seized
control of Fiji's Reserve Bank and has devalued the Fijian dollar by 20
percent in an attempt to boost exports and help an ailing economy.

Tough exchange controls have also been imposed to prevent money from flowing out of the country.

Key tourism, clothing and sugar cane industries are sliding into reverse as the political turmoil hits the Fijian economy.

Situation causing concern

New Zealand's Foreign Minister Murray McCully calls the situation troubling.

"The
fact that the military have acted in this way, particularly around the
Reserve Bank, shows that they have little understanding of the
complexity of that situation and of the damage they could do. ... We
cannot stop the Fijian Government from wrecking their economy if they
are hell-bent on doing so and it appears that they may well be
hell-bent on doing so," said McCully.

New Zealand and Australia have urged Fiji's military to hold elections, demands that Commodore Bainimarama has ignored. 

Why was government overthrown?

Bainimarama,
a former United Nations peacekeeper, says he was obliged to depose the
democratic government because it was racist and corrupt. The military
says elections will be held when electoral and political reforms have
been completed, although no timetable has been given.

After
abandoning the constitution and reinstating the military, President
Ratu Josefa Iloilo said Commodore Bainimarama would serve as interim
prime minister for the next five years.

The coup in 2006 was
Fiji's fourth in 20 years.  Analysts say the root of the country's
political instability is tension between indigenous Fijians, who make
up about 55 percent of the population, and ethnic Indians who were
originally brought to the country as laborers in the 19th Century by
colonial power Britain.