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By Jason Brown

RAROTONGA, Cook Islands (December 23, 2000 - Cook Islands News)---Cracks are beginning to appear in official views over the coalition approach to shipping.

Two different views are tucked away in the latest Half Year Economic and Fiscal Update, released this week.

In the update, Minister of Finance and Prime Minister Dr. Terepai Maoate quietly supports moves to create a government-backed monopoly in shipping.

In the same update, Financial Secretary Kevin Carr lists "government policy shifts" as a risk to the economy.

Carr does not directly mention controversy during the year over moves by government to create a shipping monopoly for political supporters.

However, in the update, under an ‘overview’ of internal risks to the economy, Carr does list government policy shifts as a threat.

"Although business confidence in the period remains optimistic, shifts can occur in response to global market conditions, government policy revisions, and the damaging impacts of natural disasters."

More specifically, the financial secretary goes on to state, under the title of government policy shifts, that the government is committed to helping business grow. "Therefore, should the policy shift towards assuming roles and functions of the private sector, this would of course affect the economy."

This is the first time that the financial secretary has mentioned ‘policy shift’ as a concern to the economic future of the country. However, despite labeling the risk factors as an overview, he does not go into details.


Neither does Minister of Finance and Prime Minister Dr. Terepai Maoate, making only the most shadowy of comments on the shipping controversy, but from the opposite view.

"As much as possible, the broad interests of all Cook Islanders must take precedence in factoring the impact of regional and globalize influences.

Dr. Maoate and other government ministers have already publicly exposed what they say is an attempt by foreign shipping interests to create a monopoly here and other Pacific countries. He lists "transportation hardships" as one concern facing the country.

Should that require additional attention and effort, the government will provide the means to address concerns through institutionalized arrangements," says Dr. Maoate. The government has already ‘institutionalized’ its support for a monopoly by changing parts of the law. The government removed sections from its own International shipping act that promote competition in shipping. Another change was to the Cook Islands Investment Corporation Act, which removed sections that stopped government from competing with the private sector.

Dr. Maoate makes no mention of these law changes in his part of the Half Year Update, signed by both men.


Not mentioned by either is the absence of actual figures on the economy and government spending.

This makes it harder for the public to judge whether government’s forecasts are realistic or not.

This week’s update is one of three reports required by law under the Ministry of Finance and Economic Management Act 1995-96. In March each year, government must present a budget policy statement to allow for public input.

However, no official channel exists for public input after the new coalition government got rid of the National Development Committee last year.

In July each year, government presents the annual budget, which also contains official economic and social forecasts. The final report, the Half Year Update, is released each December.

On Wednesday, the financial secretary left the country for four weeks after doubts were raised about public debt figures. Despite saying he was "happy" to discuss the debts, Carr’s private secretary later sent an apology to say he was "too busy" to explain them before he left.

The update was hand delivered to the Cook Islands News after Carr left early Wednesday morning.

For additional reports from the Cook Islands News Online, go to PACIFIC ISLANDS REPORT News/Information Links: Newspapers/Cook Islands News Online.



RAROTONGA, Cook Islands (December 27, 2000 – Radio Australia)---Cook Islands Prime Minister Dr. Terepai Maoate, and his Finance Secretary, Kevin Carr, appear to be at odds over the future economic policy of the island nation.

Dr. Maoate wrote in his government’s latest economic and fiscal review that he was supportive of moves to create a government-backed shipping monopoly.

However, Finance Secretary Carr lists such reversal of economic policies or "policy shifts," as he termed it, as "a risk to the Cook Islands economy."

Dr. Maoate and some of his government ministers have exposed what they claim is an attempt by foreign shipping interests to create a monopoly in the Cook Islands and other Pacific countries.

He also lists "transportation hardships" as a major concern currently facing the country.

For additional reports from Radio Australia, go to PACIFIC ISLANDS REPORT News/Information Links: Radio/TV News/Radio Australia.

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