The Politics of Affirmative Action in Post Colonial Fiji

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Vakatorocaketaki ni taukei: the politics of affirmative action in post colonial Fiji

Steven Ratuva

This article examines the relationship between affirmative Steven Ratuva is a political action and regime change in Fiji—in particular, how affirmative sociologist at the University of action has been used as a tool of social engineering. It argues Auckland. that affirmative action is more than an ordinary policy prescription; rather, it has fundamental social engineering and restructuring intent, based on political and ideological considerations. Changes in the affirmative action programs have been associated with changes in the interests of the ruling élites, and, since independence, there have been shifts in emphasis and strategies resulting from the interests of the élites. Many affirmative action programs have led to failure and loss of state resources. Since the military coup in 2006, most of the affirmative action programs associated with past regimes have been removed, including through the dramatic control and then weakening of the indigenous Fijian middle class, which benefited from past affirmative action policies. Paradoxically, under the rubric of ‘rural development’, the interim government has reinvented affirmative action, but it is now targeted at poor rural villagers and shuns the middle class.

Affirmative action is an often-controversial on ‘preferential policies’ can be misleading mechanism used by states to address issues because, as shown in countries such as of equity, conflict resolution, historical repa- Malaysia and Fiji, affirmative action can be ration and empowerment for disadvantaged a framework for major restructuring and groups. It is commonly conceptualised social engineering. This article argues that as government-mandated ‘preferential rather than being just a policy response to policies’ towards government-mandated historically defined conditions, it is often groups (Sowell 1990:10). Sowell’s emphasis driven by political, economic and ideo-

168 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

logical imperatives for the purpose of social of the underlying assumptions is that the reconstruction and engineering. Affirmative creation of equity and a just society is a action in Fiji has been driven by evolving precondition for political stability (Kende political imperatives—initially, by the push 2009). In some of these counties (the United for multi-racialism after independence in States, India, Canada and Brazil), the 1970; by ethno-nationalism after the 1987 designated categories are minorities, while and 2000 coups; and by counter-ethno- in others (Fiji, Malaysia, South Africa and nationalism after the 2006 coup—all for the Namibia), the designated categories are not purpose of socially engineering a new order only ethnic but also politically dominant (Ratuva 2009). majorities. Cottrell and Ghai (2007) make The theoretical discourse on affirmative the argument with respect to Fiji that indig- action spans a number of areas includ- enous Fijians were not exploited minorities ing political representation, educational and did not deserve affirmative action; opportunities, employment, and economic however, the complex interplay between advancement for disadvantaged social politics and ethnicity created a situation groups, identified on the basis of gender, where ‘affirmative action becomes deeply class, caste, ethnicity or physical disability implicated in inter-community politics as (Kellough 2006; Lipson 2006; Sterba 2009; well as in the structure of the state’ (Cottrell Wines 2006). There has also been recogni- and Ghai 2007:228). tion of the importance of psychological The criticism of affirmative action as approaches concerning the cognitive and ‘reverse discrimination’ is based on the behavioural dispositions of designated assertion that it is contradictory and mor- and non-designated communities and the ally repugnant to use categories such as impact of these on society as a whole (Bobo sex, religion or race—which were the basis 1998; Crosby and Franco 2003). The question for earlier discrimination—as the basis for of who should be part of the designated affirmative action (Faundez 1994:4). While category and the justification for defining ethnic affirmative action is highly contro- the designated category are often political versial, gender affirmative action is the least (Neblo 2009) based on negotiating the bigger controversial because of the cross-communal issues: ethnic relations, conflict, culture, and increasingly internationalised and power and equality. Attempts at implemen- universally accepted principle of gender tation through use of labour-market quotas equality. There is a strong argument that have been contested by some on the basis if gender-based affirmative action—or of equity and justice—the same arguments any other form of affirmative action for used to justify affirmative action in the first that matter—is compensatory or based on place (Jain, Sloane and Horwitz 2003). reparation then it is morally justified (Pincus Some justificatory principles for affirma- 2003). tive action are quite common in some The debate about affirmative action in countries. The notion of ‘correcting historical Fiji has largely revolved around a number of wrongs’ is used in the United States (Pincus issues, including the need for equity, nation 2003), South Africa (Horwitz 2009), Canada building, conflict resolution, rights of indi- (Agocs 2009) and Namibia (Usiku 2009); genes, and the definition and composition while ‘equity creation’ is used in Malaysia of the ‘disadvantaged’. The first argument, (Gometz 2009), Brazil (Bernardino-Costa based on the International Labour Organisa- 2010), Northern Ireland (Harvey 2010), Fiji tion (ILO) Convention of Indigenous Rights (Ratuva 2010) and India (Parikh 2010). One (169), was that indigenous Fijians—because

of their relative lack of entrepreneurial development carried out within the ambit participation, educational and profes- of the People’s Charter (Government of Fiji sional achievement, and socioeconomic 2008)—a social engineering framework for development, and by virtue of their being socioeconomic and socio-political transfor- indigenes—should be the main designated mation in Fiji. category (Fijian Initiative Group 1992; Gov- One of the first tasks of the military ernment of Fiji 1990; Qarase 1995). Herein regime when it captured state power in was a veiled warning that failure to address the December 2006 coup was to engage in the Fijian question would continue to create comprehensive political engineering—a conditions for ethno-political volatility and component of which was the eradication conflict (Fisk 1970; Government of Fiji 2001). of any institution, program or policy from So, affirmative action was seen as serving the old order that it considered archaic, cor- multidimensional interests—as a means of rupt or racist. Affirmative action was one redressing inequality, as an unquestioned of their main targets, primarily because it natural right of indigenous Fijians, and as was seen to be pro-indigenous Fijian and a conflict-resolution mechanism. was thus considered ‘racist’, and, worse The second and contrary position was still, affirmative action was shrouded in that the disadvantaged category should controversy as a result of a major corruption be de-ethnicised and inclusive to include scandal (the so-called ‘agricultural scam’) anyone from any ethnic group considered under the deposed government of Laisenia to be socioeconomically disadvantaged—a Qarase (‘Agriculture scam trial continues’, principle that was seen to reflect the spirit Fiji Times, 7 July 2008). Affirmative action of multiculturalism, inclusivity and ‘social has never been mentioned in any of the justice’ enshrined in the 1997 Constitution military regime’s policy statements, except (Government of Fiji 1997:s. 44, pp. 32–3). in derogatory terms when reference has The third argument was that affirmative been made to the Qarase government (‘Fiji action should be targeted at addressing pov- goes on the offensive’, Island Business, 4 erty because poverty was trans-ethnic and December 2008). The paradox is that the was worsening as a result of a number of military regime has reinvented affirmative factors, including the contracting economy action to shift it away from consolidating an and lack of opportunities (Chand 2007; indigenous middle class to service delivery ECREA 2005). to indigenous rural villagers as a strategy The fourth argument—advocated by to boost indigenous Fijian development the current ruling military regime—is that (vakatorocaketaki ni taukei) (Government of affirmative action is fraudulent and a tool Fiji 2009). One of the consequences of this of rent seeking and corruption by both approach was the general weakening of the indigenous Fijian and non-indigenous Fijian established indigenous middle class through élites, rather than a means of advancement forced removal of prominent individuals for disadvantaged groups (Ratuva 2009). from key public service, board and state The military regime has abolished virtually corporation positions and the centralisation all the affirmative action programs associ- of power in the hands of the military. ated with previous governments and has After Fiji’s independence from Britain set up the Fiji Islands Commission Against in 1970, pro-indigenous Fijian policies, bor- Corruption (FICAC) to investigate cases of rowed from Malaysia, were encapsulated corruption associated with them. The focus in Development Plan 5 (Government of Fiji has turned to poverty reduction and rural 1970). Malaysia had special provision for

170 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

indigenous Malays in its 1954 Constitution The evolution of preferential and, in 1970, a major economic transforma- programs tion under the New Economic Policy (NEP) was initiated to address the issue of ethnic After Fiji became a British colony in 1874, economic imbalance and poverty reduction. the colonial state initiated a number of fun- Like Malaysia’s, Fiji’s affirmative action damental changes to the Fijian community, policy was driven by the desire for equal amongst which were the reconfiguration of ethnic participation in the economy as part the governance and chiefly structures, codi- of the national unification strategy under fication and universalisation of a common the Alliance Party’s multiracial experiment landowning system, and consolidation of a aimed at more ethnic and regional equitable communal system around a village subsist- development. Affirmative action after the ence economy (France 1969). This system 1987 and 2000 coups was, however, seen kept indigenous Fijians outside the main- as a major social engineering project by stream commercial arena and proved to be a indigenous Fijian élites to restructure the major factor in the retardation of indigenous economy in favour of indigenous Fijians, Fijian development and the spawning of very much along the lines of the economic ethno-nationalist resentment (Lawson 1991). restructure under Malaysia’s NEP. The resulting wave of ethno-nationalism in Following the counter-ethno-nationalist later years—fuelled by actual and perceived coup in 2006, the term ‘affirmative action’ ethnic inequality in the labour market, was removed and preferential policy was ethnic competition over political power, reconceptualised fundamentally along the and deployment of ethnicity for political pre 1987 policies of rural development to mobilisation—provided the backdrop to address indigenous socioeconomic interests. the clamour for preferential policies for The dramatic shift in emphasis was driven indigenous Fijians in later years. by political circumstances. The post 1987 Prototype affirmative action policies and post 2000 affirmative action projects aimed at improving the socioeconomic were driven by ethno-nationalism and were situation of indigenous Fijians can be traced geared towards creating an indigenous back to the first decade of the twentieth middle class, while the post 2006 affirmative century when Governor Im Thurn was action was targeted at rural villages and was concerned that the rigid communal system also meant to neutralise the form of ethno- instituted in 1876 by Sir Arthur Gordon, the nationalism that fomented the 1987 and 2000 first British governor, locked indigenous coups. The military regime hoped that by Fijians into an unproductive subsistence satisfying the basic socioeconomic needs of mode, and kept them outside the ambit of rural indigenous Fijians, it would be able to the mainstream commercial sector (Spate neutralise the nursery for ethno-nationalism 1959). Attempts to liberalise indigenous at the grassroots level and in the process Fijian landownership and social structure shift away from past tendencies in which met fierce resistance and had to be thwarted. socioeconomic grievances were readily There were, however, attempts to slowly translated into nationalistic mobilisation. socially engineer indigenous Fijians into This article is not a comparative study mainstream commerce in the 1940s, 1950s with Malaysia, but given the salience of and 1960s through banana and copra Malaysia’s influence, the article will make production as well as cooperatives. This comparative references to Malaysia’s affirm- action did not work very well because it ative action program where appropriate.

was carried out within the ambit of com- than 50 per cent of the population). This munal hegemony, which restricts individual issue is discussed in more detail later, but enterprise and, besides, these industries it is important to note at this stage that were monopolised by European merchants, opposition to this policy came from the who did not allow for competition from Indo-Fijian community, which saw it as indigenous producers. The socioeconomic a form of discrimination and an attempt situation of indigenous Fijians became a to deprive deserving Indo-Fijian students serious concern of the colonial state, which (Ali 1982). As part of the aggressive push consequently commissioned two reports— for indigenous education, the Fijian Affairs the Spate Report (1959) and the Burn Report Board later provided special scholarships. (1963)—both of which recommended con- Over the years these proved to be quite certed attempts to accommodate indigenous successful in terms of producing a large Fijians in the mainstream economy. pool of graduates and consolidating a large It was not until independence from indigenous middle class. Britain in 1970 that coherent development The emerging indigenous middle class plans with preferential policies for indig- by and large had a strong ethno-nationalist enous advancement were designed. The first orientation, which resulted from their com- of these was Development Plan 5, which petition with Indo-Fijians for civil service focused on ‘Fijian development’. The plan and private sector employment, which they consisted of several large-scale agricultural perceived to be dominated by Indo-Fijian development projects in the areas of sug- cliques. This antagonism was manifested in arcane, banana and cattle farming, as well indigenous Fijian middle-class support for as educational and entrepreneurial experi- the 1987 coup, since it was hoped that the ments that were meant to equip indigenous coup would weaken Indo-Fijian dominance Fijians for the challenges of the fast-changing in the political, civil service and professional market economy (Government of Fiji 1970, realms. Since it was difficult to compete 1975, 1980). The banana and cattle farming with Indo-Fijians at their own game, many projects were not commercially successful; indigenous Fijians thought it was more however, a very small number of indigenous convenient to use political means to achieve Fijian farmers made successful inroads into their goals. the Indo-Fijian-dominated sugar industry (Ratuva 1999). Simultaneously, there was a push for indigenous education to make up The 1987 coups and coerced for the low number of indigenous Fijians affirmative action in higher education and the professions, where 10 years before independence they Although various forms of affirmative action were outnumbered by a factor of one to 36 have been adopted in Fiji since independ- by other ethnic groups. ence, the term ‘affirmative action’ was not The first comprehensive educational used officially until after the first coup in affirmative action policy was in 1977, when May 1987, which saw the overthrow of the Alliance government, under Ratu an elected Indo-Fijian-dominated Labour Sir Kamisese Mara, an Oxford-educated Party–National Federation Party coalition high chief, legislated that 50 per cent of government (Lal 1992). A second coup was scholarships to the University of the South carried out on 25 September 1987 to consoli- Pacific were to be reserved for indigenous date the first coup, after attempts to set up Fijians (who at that time made up less a government of national unity threatened

172 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

to undermine the intent of the first coup of constitutional affirmative action framework indigenous political paramountcy. It became that provided that apparent to the pro-indigenous military Parliament shall, with the object of leaders that there was a need to fast-track promoting and safeguarding the preferential policies outside the ambit of economic, social, educational, cultural, the usual development plan. The post 1987 traditional and other interests of the coup affirmative action plan had a number Fijian and Rotuman people, enact laws of strategic prongs. Amongst these were: for those objects and shall direct the control of state institutions by indigenous Government to adopt any programme Fijians and use of the bureaucracy and or activity for the attainment of the political machinery to drive the affirmative said objects and the government shall action program; channelling state resources duly comply with such directions. towards indigenous Fijians; increasing the (Government of Fiji 1990:s. 21) number of indigenous Fijians in business; This paved the way for the enactment increasing the number of indigenous Fijians of affirmative action legislation in the 1980s in the civil service; and creating and growing and 1990s, including the controversial an indigenous Fijian middle class to balance Public Service Commission Regulation, the established Indo-Fijian middle class which reserved 50 per cent of civil service (Fijian Initiative Group 1992; Qarase 1995). positions for indigenous Fijians (Fiji Republic Affirmative action became a political Gazette, 4[83][1990]:910). imperative under the direct supervision of the ethnocratic military state and was Civil service legitimised by the newly promulgated 1990 ethno-nationalist Constitution, which The impact of the indigenisation of the civil prescribed indigenous Fijian political service was almost immediate. In 1986, just hegemony after the 1970 Constitution was prior to the coup, of the total number of civil abrogated (Ratuva 2000). A way of consoli- service staff, 52 per cent were Indo-Fijians, 43 dating hegemony was to ensure control of per cent were indigenous Fijians and 5 per Parliament by increasing the number of cent belonged to other minority groups. The indigenous Fijian seats by 15 compared with high turnover of Indo-Fijian staff after the an increase of only five for Indo-Fijians. coup dramatically altered the ethnic profile. Furthermore, the 1990 Constitution tried In 1987, of the total turnover, 80 per cent were to define the indigenous ‘Fijian’ affirmative Indo-Fijians and other minorities compared action-designated category using two vari- with about 20 per cent for indigenous Fijians ables: a direct grand-patrilineal blood link (Table 1); and in 1988, the shares were 68 per and acceptance by one’s mataqali (traditional cent and 32 per cent, respectively (Fiji Public socio-cultural group) for registration in the Service Commission 1995). Vola ni Kawabula—the indigenous Fijian By 1992, the turnover rate seemed to genealogical registry (Government of have stabilised, with the figures for the Fiji 1990:120). This provision was heavily two major ethnic categories almost on par. criticised for being too sexist, racist and The departures from the civil service were exclusive because it discriminated against replaced with new appointments, which those with indigenous Fijian mothers favoured indigenous Fijians. From 1991 to but with non-indigenous Fijian fathers. 1994, indigenous Fijians constituted about The legal construction of the designated 60 per cent of the annual appointments category was directly linked to the broader (Table 2). Prior to the coup, in 1985, new

appointments to the civil service were 47 per of Indo-Fijians had declined to 38.6 per cent cent for indigenous Fijians and 53 per cent (Reeves, Vakatora and Lal 1996). for Indo-Fijians and other minorities (Fiji By 1997, only one of the 10 heads of gov- Public Service Commission 1986). ernment departments was an Indo-Fijian, The changes in the ethnic shares of the compared with more or less equal numbers civil service over the 10 years from 1985 prior to the coup. About 80 per cent of the to 1995 were significant (Table 3). In 1985, Indo-Fijians who left the civil service migrated. the figures were indigenous Fijians 46.4 In 1987, there was a net departure of 18,563, per cent and Indo-Fijians 48 per cent. In compared with 6,490 in 1986 and 6,193 in 1995, the share of indigenous Fijians had 1985. Of these, 78.1 per cent were Indo-Fijians increased to 57.3 per cent, while the share (compared with 41.2 per cent in 1980), 6 per

Table 1 Civil service staff turnover, 1987–94

Year Fijian/Rotuman Percentage Indian/others Percentage Total (of total) (of total) 1987 258 20.5 1,003 79.5 1,261 1988 486 31.8 1,041 68.2 1,527 1989 676 40.0 959 60 1,635 1990 532 48.8 560 51.2 1,092 1991 393 40.9 567 59.1 960 1992 740 52.6 666 47.4 1,406 1993 697 54.9 573 45.1 1,270 1994 701 58.6 497 41.4 1,198

Source: Fiji Public Service Commission, 1995. Annual Report, Public Service Commission, Suva:16. Table 2 Civil service appointments, 1991–94

Year Fijian/Rotuman Percentage Indian/others Percentage Total 1991 594 58.6 417 41.4 1,011 1992 1,182 58.0 857 42 2,039 1993 892 57.7 657 42.3 1,546 1994 631 57.2 472 42.8 1,103

Source: Fiji Public Service Commission, 1995. Annual Report, Public Service Commission, Suva:16. Table 3 Total number of staff in the civil service by ethnicity

Year Fijian/Rotuman Percentage Indian/others Percentage Total 1991 9,296 55.8 7,360 44.2 16,656 1992 9,682 56.6 7,429 43.4 17,111 1993 9,631 56.8 7,317 43.2 16,948 1994 9,709 57.2 7,261 42.8 16,970

Source: Fiji Public Service Commission, 1995. Annual Report, Public Service Commission, Suva:15.

174 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

cent indigenous Fijians, and 12.5 per cent consisted of indigenous Fijian professionals, other minorities. By 1989, however, two years civil servants and entrepreneurs, and which after the coup, the total number of Indo- first met in 1988 (under the chairmanship of Fijians migrating had declined to almost half former prime minister Ratu Sir Kamisese of the 1987 figure (7,412), but their share still Mara) and became formalised in 1992. stood at 79 per cent. Altogether, an estimated The major proposals were F$20 million 50,104 Fijian citizens migrated in the period equity was to be injected from the Fijian 1987–91, compared with 26,529 between 1982 Affairs Board (FAB) to the Fijian Holdings and 1986. About 80 per cent of these were Company (FHC), an indigenous trust com- Indo-Fijians (Chetty and Prasad 1993). The pany based on the Malaysian bumiputera pro-indigenous Fijian coup and subsequent trust company concept; a unit trust for reforms, including coerced affirmative indigenous Fijian financial investment was action, forced Indo-Fijians out of Fiji in large to be established; a compulsory savings numbers. scheme (CSS) for Fijians was to be set up; Apart from the civil service, the two government concessions for indigenous other important state apparatus whose Fijian businesses were to be enhanced; a control was deemed necessary for indig- Management Advisory Services Depart- enous hegemony were the military and ment (MASD) was to be established in the the police. The military had always been FAB; and indigenous Fijians should have a predominantly (more than 90 per cent) 50 per cent minimum ownership share of indigenous Fijian. In 1986, a year before resource-based industries. Furthermore, the coup, the police force comprised 50 certain sectors of the economy were to be per cent indigenous Fijians and 47 per cent reserved for indigenous Fijian investment; Indo-Fijians; in 1995, the figures were 58 per there should be ownership of a daily news- cent indigenous Fijians and 40 per cent Indo- paper by indigenous Fijians; and the FAB Fijians (Fiji Police Force 1996). Immediately should be restructured and strengthened after the 1987 coup, the Indo-Fijian commis- (Fijian Initiative Group 1992). sioner of police was removed, together with The main follow-up to the Nine Points other senior officers of ‘questionable loyalty’, Plan was the Ten Year Plan for Fijian Participa- and was replaced with an indigenous Fijian, tion in Business, authored by Laisenia Qarase who later retired to give way to a senior (1995), then managing director of the Fiji army officer, Colonel Isikia Savua. The Development Bank (and a leading propo- police, like other areas of the civil service, nent of ethnic Fijian affirmative action), became militarised as colonels took over and commissioned by the UN Economic senior positions, consolidating a military and Social Commission for Asia and the bloc within the civilian sphere. The triple Pacific (ESCAP). The report, which was processes of indigenisation, affirmative more comprehensive than the Nine Points action and militarisation became part of a Plan, suggested that the objective of affirma- common political engineering process. tive action ‘should be the achievement of overall parity between Fijians and other Business sector communities in all spheres of activities As a means of addressing ethnic disparity in within the shortest period of time possible’, the business sector, a number of proposals and it should ‘ensure that indigenous Fijians were made in 1992 in a document called the achieve 50% ownership of the corporate Nine Points Plan. The plan was produced sector and other business sectors by the year by the Fijian Initiative Group (FIG), which 2005’ (Qarase 1995:4). The five strategies

suggested were enactment of appropriate the communal affairs of the Fijian adminis- legislation with the object of promoting tration would be minimised, thus providing and safeguarding the interest of indigenous the latter with the necessary autonomy to Fijians; reorganisation and strengthening streamline its communal organisational role of the Fijian administration; accumulation and maintain cohesion within the indig- of savings to provide investment capital; enous Fijian community, while at the same encouragement of indigenous Fijians in time creating a competitive indigenous investment; and development of indigenous Fijian bourgeoisie. Fijian entrepreneurship, business educa- The lack of a sizeable indigenous Fijian tion and training. These strategies merely entrepreneurial class was a major driving reinforced the basic tenets of the Nine force in these economic reforms. There were Points Plan but the difference was its sense differences in the ethnic distribution of of urgency and the specific target of 50 per economic activities, with indigenous Fijians cent indigenous Fijian business ownership concentrated more in primary agricultural by 2005. activities and Indo-Fijians in the white- The Ten Year Plan, which later became collar professions. The conspicuously low the government ‘blueprint’ for indigenous representation of indigenous Fijians in the Fijian business, identified a number of commercial sphere was evident in official government-controlled industries for company figures. For instance, between privatisation, with government shares to 1986 and 1987, just before the coup, of the be transferred to Fijian Holdings and other 700 companies registered by the Office of indigenous Fijian corporations. These the Registrar of Companies (1987:2), only included big monopolies such as Fiji Post 15 per cent belonged to indigenous Fijians, and Telecom, Fiji International Telecom- compared with 50 per cent ownership by munications Limited (FINTEL), Fiji Forest Indo-Fijians, 20 per cent by Europeans and Industries Limited (FFI), Fiji Pine Limited Chinese, and 15 per cent joint ventures (FPL), Tropic Woods Limited (TWL), the owned by other ethnic groups. Pacific Fisheries Company (PAFCO) and the To the indigenous state élites, the National Bank of Fiji (NBF). panacea for inequality lay in catapulting A number of Ten Year Plan recom- indigenous Fijians into the business world mendations were implemented. Some of with the help of state patronage. In 1992, these—similar to some of those imple- the government allocated F$20 million as mented in the Nine Points Plan—included loans to FAB to buy ‘B’-class shares from the reorganisation of the Fijian administra- Fijian Holdings Limited and to hold them tion, expansion of Fijian Holdings Limited, in trust for indigenous Fijians to be sold to continuation of the Commercial Loans to indigenous Fijian shareholders later.1 Since Fijians Scheme (CLFS) by the Fiji Develop- 1987, the operations of Fijian Holdings have ment Bank (FDB), the setting up of the Unit been aggressively extended to buying shares Trust investment, establishment of a Small in many leading corporations in Fiji. Equity Fund (SEF) within the Ministry of In 1989, the government provided two Fijian Affairs, and a management training major concessions for the CLFS, which was scheme for indigenous Fijians in the private set up in 1975 to assist indigenous Fijians sector. By making the FAB separate from in small to medium-sized businesses. The the Ministry of Fijian Affairs (one of the concessions were first, an increased subsidy major reorganisations), it was hoped that of 5.5 per cent per annum on loans up to interference by the central government in F$200,000, giving an effective interest rate

176 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

of 8 per cent; and second, a cash grant FTL were the FDB (51 per cent), Television equivalent to 10 per cent of the fixed assets New Zealand (15 per cent), Fiji Post and cost, with a maximum grant of F$20,000 Telecom (14 per cent), and the general public for each project (Fiji Development Bank (20 per cent). The FDB’s shares were held 1996). CLFS loans increased dramatically in trust on behalf of indigenous Fijians, after the coup. For instance, in the 11 years represented by the 14 provincial councils between 1975 and 1988 there were 4,720 (Qarase 1995). The provincial councils loans totalling about F$25 million. But from owned Yasana Holdings Limited (YHL), 1989 to 1994, there were 6,189 loans totalling a company established by the FAB to look F$99 million (Fiji Development Bank 1996). after provincial investments. This was one The upsurge in loan approvals from 1989 of the many affirmative action projects ‘reflects the impact of Government conces- based on communal ownership. sions’ (Qarase 1995:29). Despite the initial The Fiji National Provident Fund (FNPF) optimism, CLFS loans had a high failure was also involved in a project called the Vil- rate, with arrears averaging between 19 lage Housing Scheme (VHS), which was set and 23 per cent. Eventually, the scheme was up in 1987 to provide homes for rural villag- forced to close. It was to be just one of the ers. A total of 27,373 applications amounting many failed affirmative action projects. to F$53.91 million were approved and paid Perhaps an area where the quota system out. This project, too, was later stopped was most pronounced was in the taxi busi- because of its unsustainability (FNPF 2006). ness, which had always been dominated by In addition, the FNPF set up the Small Indo-Fijians. For instance, in 1988, 87 per Business Equity Scheme (SBES) in 1990 cent of all taxi licences were in the hands to provide finance for small businesses, of Indo-Fijians; only 11 per cent belonged especially those of indigenous Fijians. A to indigenous Fijians. On 22 October 1993, total of 4,621 members have been assisted, there was a ministerial directive that no representing F$17.22 million in payments. In more permits were to be issued to Indo- 1996, a total of 1,379 applications, amounting Fijians to make sure that indigenous Fijians to F$3.5 million, were approved; of these, could bridge the gap. By 31 December indigenous Fijians constituted about 90 per 1994, the Indo-Fijian share had fallen to 61 cent—1,200 applications—totalling F$2.76 per cent and the indigenous Fijian share million in payments (FNPF 2006). had increased to 34 per cent (LTA 1995). As a way of mobilising resources and Initially, upon being issued with licences, maintaining ethno-cultural solidarity, some indigenous Fijians either rented or indigenous Fijians were encouraged to sold them to Indo-Fijians; but over the years engage in communal investment through the number of indigenous Fijian-run taxis their extended kinship or administrative has increased sharply, with many forming social groups such as tokatoka (group of successful taxi and mini-bus cooperatives. nuclear families), mataqali (group of tokatoka), One of the main indigenous Fijian tikina (district), yasana (province), and other commercial acquisitions was Fiji Television forms of collective groupings. These groups Limited (FTL). The government granted bought shares in Fijian Holdings, Unit Trust a 12-year exclusive television broadcast and other investment groups (Ratuva 2000). licence to FTL on the understanding that Even political parties and politicians formed indigenous Fijian control of FTL would investment groups on behalf of indigenous increase. In 1995, the main shareholders in Fijian entrepreneurs. An example was the Gaunavou Investments Company Limited

(GICL) (Gaunavou literally translates as rural areas for indigenous Fijian schools. The ‘modern times’). The GICL, which was aim was for the ‘development of basic educa- incorporated as a public company on 11 tion, particularly improvement of access to November 1994, was set up by the Suva City secondary education for rural students’ (Fiji Fijian Urban Constituency branch of the Ministry of Education 1993:130). ruling Soqoqsoqo ni Vakvulewa ni Taukei The proportion of government schol- (SVT) Party ‘with the positive intention to arships awarded by the Public Service start and promote indigenous Fijian enter- Commission to indigenous Fijians for prise and business activities’ (Daily Post, 13 university education rose from 34 per cent in March 1999:3). Amongst the shareholders 1970–74 to 44 per cent in 1980–84, and again, were General Sitiveni Rabuka (the 1987 to 49 per cent in 1985–89, and to 52 per cent coup leader and later prime minister) and a in 1990–92. This allocation was made despite number of government cabinet ministers. the fact that indigenous Fijians constituted only about one-third of all students qualify- Education ing to enter university. Moreover, following Affirmative action in education was taken the 1987 coup, an average of 62 per cent of in response to serious concerns about the all in-service training scholarships was educational achievement of indigenous allocated to indigenous Fijians (Fiji Public Fijians—even before independence in 1970. Service Commission 1995). The FAB has also The Royal Commission on Education of provided scholarships to indigenous Fijians; 1969 recommended ‘positive discrimination between 1984 and 1988, the FAB awarded provisions’ for indigenous Fijians but it was 1,181 local scholarships and 150 overseas not until 1977 that the government decided scholarships. Over the period 1989–92, these to implement the scholarship quota for entry numbers were increased to 1,719 and 108, into the University of the South Pacific. respectively. In the 16 years up to 2001, the Furthermore, a Fijian education unit FAB provided up to 7,000 scholarships and was set up in the 1970s within the Ministry about half of these graduated within the of Fijian Affairs to work collaboratively prescribed time (People’s Coalition Govern- with the Ministry of Education to provide ment 2001). More than 90 per cent of these scholarships and resources for Fijian schools graduates entered the labour market and and also to monitor the progress and contributed to the expanding indigenous achievement of indigenous Fijian students. middle class. This effort was boosted by a F$3.5 million injection for Fijian education in 1984 to upgrade indigenous Fijian educational The rise and demise of post 1987 facilities and resources (including teachers) coup affirmative action at the primary and secondary school levels, and to provide scholarships for indigenous While some affirmative action programs Fijian students. It was felt that providing such as education were successful, the rush assistance at an early stage of educational to create an indigenous business class by development was crucial in building up trying to create an entrepreneurial culture a solid educational base for indigenous within a short time had its tragic shortcom- Fijians. A further F$2 million was used after ings. In 1992, when Fijian Holdings became the coup in 1987 to establish an Education a limited liability company, a group of Unit in the Ministry of Education and the indigenous Fijian professionals and bureau- setting up of educational media centres in crats who worked in state banks and senior

178 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

government positions was able to form advancement. Within a few years, the companies using insider information to buy bank became insolvent, debts were written shares, even before the rest of the country off, and more than F$200 million was lost. knew what was happening (Korovulavula A subsequent investigation unearthed a 1993). This led to a huge scandal, which was complex web of deals between politicians covered widely in the local press and even and businessmen involving money transfers debated in Parliament. The group had direct and political patronage (Grynberg, Munro links to the military and state leadership and and White 2002). had significant influence on important state One of the ironies was that although boards dealing with finance and investment. the NBF collapsed, the loans provided the They had direct influence on state policies means for a large number of indigenous and the operation of state institutions and Fijians to break into the middle class, at least had a virtual monopoly of information in terms of lifestyle and self-perception, and and control of equity acquisitions in Fijian expanded indigenous middle-class aspira- Holdings. Some of the illegal and unethical tions in a significant way. business practices were condoned because The ‘trickle-down’ strategy of the State they were seen to be politically acceptable was to encourage rural communities to as part of the general purpose of speeding invest in Fijian Holdings Limited (FHL) up indigenous Fijian entry into the business through communal investment. The initial world. A number of these cases continue to funding was provided by the State through be the subject of investigation by the Fiji the FAB and was distributed to provinces, Independent Commission Against Corrup- districts and villages. The problem was that tion (FICAC), set up by the Fijian military the income generated from this investment after the 2006 coup. scheme was minimal and had to be shared There was an even worse outcome amongst the members of the respective when the state-owned National Bank of Fiji communities. After one year of investment, (NBF) collapsed as a result of liberal ‘loans’ the average return was about F$1 per person to indigenous Fijians to fund their entre- (Ratuva 2000). The communal investment preneurial projects, middle-class lifestyles program was more of a political strategy for (housing, cars, credit cards, and so on), and indigenous mobilisation than one of indig- other things. After the 1987 coup, the coup enous economic advancement. Although the leader, Sitiveni Rabuka, personally went to FHL concept was borrowed from Malaysia, the bank and told the Australian general in Malaysia, the investments in bumiputera manager that he was to be replaced with trust institutions were individually based; a local. To the military regime, the NBF in Fiji, they were communally based. held the key to financing affirmative action Except for FHL and education, almost projects and had to be secured by all means. all the post 1987 coup affirmative action Millions of dollars were given out without policies failed, including FDB’s special security in a loan program that spanned housing and business loans for indigenous the entire structure of the indigenous Fijians, and its Equity Investment Manage- community—from the president (who was ment Company Limited (EIMCOL), the loaned more than FJ$5 million) and his supermarket management trainee project, family to unemployed youths. Gold credit and the FNPF indigenous loans project. FHL cards, car loans, business loans, housing now stands as the flagship of indigenous loans and even personal loans were given business and has become one of the major out liberally in the name of indigenous players in the Fijian corporate sector. By

2008, the company had nine subsidiaries: Fiji to do business and even share their Basic Industries Limited, Fiji Industries knowledge and experience with us Limited, Blue Lagoon Cruises Limited, both in the public and private sectors. Clariti (South Pacific) Limited, FHL Securi- We also want to give something in ties Limited, Fijian Property Trust Company return, not merely take (Business Limited, Fijian Holdings Trust Management Times, January 1994:10). Limited, Merchant Finance and Investment Part of the training program through a Company Limited and FHL Retailing Lim- bilateral agreement with Malaysia was the ited. It also had 12 associated companies and sponsoring of the chief executive of FHL to a total of 842 shareholders. FHL has a total study affirmative action in Malaysia—in investment portfolio of about F$142 million particular, how the bumiputera trust agency, with annual group revenue of F$213 million the NEC, worked and how it could be emu- and group net assets worth F$166.8 million lated. The Malaysian ‘helping hand’ came (Fijian Holdings Limited 2008). to an abrupt end after the 1997 East Asian The very close ties between Fiji and financial crisis, which crippled Malaysia’s Malaysia and Fiji’s attempts to emulate economy and threw its own affirmative Malaysia’s affirmative action model and its action program into uncertainty. political system led to an attempt to share The failure of many post 1987 affirma- Malaysia’s affirmative action benefits by tive action projects was due to a number encouraging successful Malaysian compa- of reasons. First, there was the mismatch nies to invest in Fiji. This started off well in between the political will and the entre- the 1980s and 1990s. Acquisitions included preneurial conceptualisation. The political South Pacific Textile (Fiji) Limited, employ- drive to implement the affirmative action ing 250 people; the SIA Cash and Carry, a policies was not guided by a systematic joint venture with local employees operat- understanding of the socio-cultural context ing a retail outlet for imported garment and of the business environment. Second, the fashion accessories; the Malaysian Bank/ indigenous Fijian loan recipients were not National Bank of Fiji partnership; and mas- provided with the right training in com- sive equity in Carpenters Corporation, one mercial and investment techniques and of the largest wholesale and retail outlets had to rely solely on their own initiatives. in Fiji. In tourism, the Malaysian Berjaya Third, the Indo-Fijian business community Corporation owned the Berjaya Inn in Suva; strengthened its networks in order to keep Sateras Resources Limited owned the Toka- indigenous business out, as they saw them toka Resort near Nadi International Airport as potential competitors, and kept tight and the Suva Motor Inn in Suva; and the control over markets through pricing. As Malaysian Shangri-La owned the Mocambo a result, some of the indigenous initiatives, Hotel and the Fijian Hotel, Fiji’s largest five- such as the supermarket experiment, failed star tourist resort (Ratuva 1999) (Ratuva 1999). In encouraging Malaysian investors in The failure of these projects was a big Fiji, Dr Ahmed Ali, Fiji’s High Commis- blow to the ambition and self-esteem of the sioner to Malaysia in the early 1990s, said indigenous élites behind the affirmative businessmen in both Malaysia and action programs. They had high expecta- Fiji can tap the huge opportunities tions, driven by state rhetoric, that the available in each other’s countries… economic renaissance of indigenous Fijians We want to welcome Malaysians to was at hand. The failure of many affirmative

180 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

action policies contributed to the demise of (post 1987 coup) national census figures. the support for Rabuka’s SVT Party and the There was an identifiable increase in the fragmentation of the political allegiance of number of indigenous Fijians in the mana- indigenous Fijians. The dramatic political gerial category—from 487 in 1986 to 1,292 in changes and perceptions also led to the 1996; however, the real significance of this review of the 1990 Constitution, and eventu- increase was much less than it appeared ally a new and more inclusive constitution (Fiji Bureau of Statistics 1986, 1996). The came into being in 1997. threefold increase was due to two main The new Constitution redefined the reasons: first, the 1996 Census definition affirmative framework under the rubric of the managerial category incorporated of ‘social justice’ and extended the des- various other subcategories that were not ignated category to include not only included in the 1986 Census; second, from indigenous Fijians and Rotumans but also 1992 to 1996, there was an increase in the other ‘disadvantaged’ groups. The social number of loans to indigenous Fijians by the justice provisions of the 1997 Constitution CLFS and thus there was a proliferation of attempted to incorporate trans-ethnic and ‘companies’ to formalise business ventures, class factors into the affirmative action pro- although many of these failed. gram. Affirmative action was conceived as Nevertheless, the pattern of ethnic dispar- a mechanism for ethnic and socioeconomic ity in 1996 was almost the same as that in 1986. equity and national unity. As a result, a new Indo-Fijians still dominated the managerial Ministry of Multi-Ethnic Affairs was set up, positions, with 76 per cent in 1986, increasing which provided scholarships for Indo-Fijian to 78 per cent in 1996 (Fiji Bureau of Statistics and other minorities, based on their socio- 1989, 1998). Despite the economic affirmative economic situation. action measures, the gap in the managerial The 1999 election was carried out using category actually increased. the new alternative-voting system under The 1996 Census report further disag- the rubric of the 1997 Constitution. The gregated the managerial category into four new government, under the leadership of subcategories: director/chief executive, Mahendra Chaudhry, the first Indo-Fijian small business manager, specialist manag- prime minister, did not consider affirmative ers, and other department managers. In all action favourably in its ethnic form and subcategories, Indo-Fijians and other ethnic began to institute policies that addressed groups dominated with between 60 and 82 the marginalised situation of minority and per cent of the total. The largest difference other disadvantaged groups. These policies was in chief executive positions, of which were prematurely terminated after the there were 82 per cent Indo-Fijians and overthrow of the government in the 2000 other ethnic groups and only 18 per cent coup. indigenous Fijians. The only category in which there was a marked increase of indigenous Fijians was Did embourgeoisement work? in professional and technical positions—an increase from 45 per cent in 1986 to 53 per The question of whether affirmative action cent in 1996 (Fiji Bureau of Statistics 1998). has worked is not easy to answer, given This increase was mainly for two reasons: the complexity of the situation. But some first, the large-scale emigration of Indo- comparative assessment can be made in Fijian professionals after the 1987 coup; and terms of the 1986 (pre 1987 coup) and 1996 second, the post coup affirmative action in

employment and education, which led to during the 1990–2003 period (Table 4). the marginalisation of Indo-Fijians in the Therefore, it seems that affirmative action public service, as discussed earlier. Most of handouts hardly trickled down in terms of the indigenous professionals and technical benefits to the lower-income groups. In the experts were in the public sector. various affirmative action strategies such as The post coup economy, however, the Nine Points Plan and 20 Year Plan, poverty especially after 1990, went through a period alleviation did not feature at all. The focus of contraction, and was not favourable to was more on corporate participation and investment. From 1991 to 1995, real per enhancing middle-class wealth. capita output growth averaged only 1 per cent per annum. This unfavourable investment climate affected everyone; thus, it The 2000 coup and affirmative cannot be seen as the explanation for the action continuing ethnic disparity in socioeconomic performance. The ethno-nationalist coup in 2000 was Clearly, while there has been an expan- seen as evidence by some indigenous élites sion of the indigenous Fijian middle class that a much more concerted effort to speed in the area of the public service and the up indigenous Fijian development was professions, this was not the case in the needed, and thus one of the urgent tasks corporate sector. Furthermore, poverty of the interim government, led by Laisenia was hardly addressed. Poverty amongst Qarase, an avowed ethno-nationalist, was indigenous Fijians continued to grow over to put together a comprehensive affirmative the years (Table 4). action framework to respond to the broad The national, urban and rural rates of ethno-nationalist sentiments. The outcome poverty among indigenous Fijians grew was the Blueprint and Government Policy for

Table 4 Incidence of poverty, 1990–91 and 2002–03 (per cent of population)*

1990–91 2002–03 National average 25.5 34.4 Indigenous Fijians 27.7 33.8 Indo-Fijians 31.0 34.9 Urban average 27.6 31.8 Indigenous Fijians .. 29.9 Indo-Fijians … 33.9 Rural average 24.3 38.1 Indigenous Fijians .. 37.3 Indo-Fijians .. 39.2

* Percentage of population having an adult equivalent per capita income less than the Basic Needs Poverty Line. .. not available Source: Abbott, D., 2007. Fiji analysis of the 2002/03 household income and expenditure surveys: estimation of basic needs poverty lines and incidence of poverty in Fiji, Unpublished draft final report prepared for United Nations Development Programme, Suva:23.

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the Enhancement of Indigenous Fijians’ and Learning from previous affirmative Rotumans’ Participation in Commerce and action attempts, this document, using an Business (Government of Fiji 2000), popularly equity index (EI) formula, attempted to referred to as the ‘blueprint’, which outlined analyse the state of inequity using official the strategic thrust for affirmative action. The national census data and calculating how blueprint called for the mobilisation of state much the indigenous Fijian level of achieve- political and administrative mechanisms ment would have to be accelerated to reach and resources and integration into the the desired 1:1 (50–50) target equity ratio macroeconomic framework of government (TER). The equity index was an attempt to (Government of Fiji 2000). The blueprint quantify the levels of achievement of the encapsulated the desires, frustrations and various ethnic groups, expressed as a ratio optimism of the post independence indig- between the existing level of equity (current enous middle class. The material state of distribution ratio, CDR) between indigenous the Indo-Fijian middle class was seen as the Fijians and other ethnic groups, relative yardstick for success and the solution was to the national population distribution, seen as establishing the conditions for emu- expressed as the target equity ratio (TER). lating the economic and business acumen of The EIs for the different occupational cat- Indo-Fijians. The focus was not so much on egories were thus different (Table 1). Hence, equity creation within the indigenous Fijian different countries will have a different TER, community as on consolidating an indig- depending on the population distribution. enous middle class—a different approach to Because the Fijian population in 2001 was the pro-rural development approach of the 52 per cent indigenous Fijians and 48 per early independence years. cent other ethnic groups, the demographic The operational details were outlined balance would be about 50–50—thus, the in an even more comprehensive document, TER would be 1:1. To achieve equity, the 1:1 ‘50/50 by year 2020’ (20 Year Plan for Fijian TER must be reached. Participation in Business), aimed at the The EI is therefore the number of times ‘enhancement of participation of indigenous the output of a particular sector must be Fijians and Rotumans in the socio-economic increased to achieve the 1:1 TER. Differ- development of Fiji’ (Government of Fiji ent sectors have different CDRs and thus 2001). As part of the program, the entire different EIs. For instance, in the corporate civil service machinery was mobilised manager category, the CDR is 1:6; in other to identify and operationalise aspects of words, for every indigenous Fijian corporate indigenous Fijian advancement in the areas manager, there are six from other ethnic of education, human resource development, groups. So to achieve the 1:1 TER, Fijian commerce and finance, public enterprise participation in this category should be reform, health, resource-based industries, increased six times; thus, the EI value is 6. tourism, culture and heritage, and rural Therefore, the target for the next 20 years development. The plan identified two major was to increase the number of indigenous issues confronting Fiji: ‘narrowing the Fijians in the corporate manager category socio-economic disparities between ethnic by a factor of six. The other five professional groups through more equitable sharing of categories had a CDR of 1:3 and an EI of resources and socio-economic restructuring; three (Table 4). and maximizing indigenous Fijian economic The 50–50 plan had a number of goals, productivity in relation to resources such as including equality creation, national wealth land’ (Government of Fiji 2001:1). redistribution, indigenous Fijian economic

advancement, and conflict resolution. But from the State to indigenous landowners. the political circumstances changed the Both bills were very unpopular and cre- situation dramatically. During the election ated tension within the country. The most in 2001, a new Fijian political party, the significant reaction was from the military, Soqosoqo Duavata ni Lewenivanua (SDL), which saw Qarase’s pro-indigenous policies under Qarase’s leadership, used the 50–50 as not only racist but also a security threat plan as the major political campaign tool to (Ratuva 2007). The tension between the SDL mobilise indigenous Fijian votes through government and the military escalated, the unauthorised delivery to voters of with the military telling the prime minister goods ranging from lawnmowers to fishing to rescind the racist policies and corrupt boats worth more than $20 million. The practices of his government. Qarase tried politicisation of the plan drew widespread to remove the military commander, Com- criticism, even amongst indigenous Fijians, modore Frank Bainimarama, several times especially after it was revealed that after it but to no avail, and the continuing tension won the election, the SDL government had culminated in Qarase’s displacement by the ‘planted’ individuals within the system as military on 5 December 2006. On 7 April ‘distributors’ of affirmative action goods to 2009, the military again took power after favoured customers. A number of people, the Supreme Court decided the previous including the chief executive officer of day that the 2006 coup was illegal. Agriculture and Fisheries, were convicted and imprisoned in relation to what came to be known as the ‘agriculture scam’. Reinvention of affirmative action The continuing drive for the indigenisation of the political process led the SDL The military regime undid what the Qarase government to push for two significant bills. government had put in place in a program The first was the Reconciliation, Tolerance they called a ‘clean-up campaign’. The and Unity Bill, which, amongst other provi- political and institutional mechanisms for sions, would see the release from prison of affirmative action and indigenisation were indigenous Fijian activists involved in the dismantled, including the removal of about 2000 coup; second was the Qoliqoli Bill, 200 indigenous Fijian CEOs and other senior which attempted to transfer ownership of officers in statal and para-statal institutions, the coastal fishing grounds and seashore some of whom had been beneficiaries of the

Table 4 Equity index for selected professions

Occupational category Current distribution ratio (CDR) Equity index (EI) Corporate manager 1:6 6 Physics, mathematics, engineering, science 1:3 3 Business and legal 1:3 3 Finance, sales, business 1:3 3 Extraction, building trade 1:3 3 Plant and machinery 1:3 3

Source: Calculated from Government of Fiji, 2001. 20 Year Plan for Fijian Participation in Business, Government of Fiji, Suva:40–5.

184 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

affirmative action program in the public Council of Chiefs and the Methodist Church service since 1987. The military saw the were paralysed and lost significant power pro-indigenous affirmative action program and control over indigenous Fijians. This as racist, corruption riddled and against the was a dual process of counter hegemony and noble values of multiculturalism. re-hegemony, involving the neutralisation of The military established in place of the old hegemonic bloc and replacing it with the plan a National Council for Building a new one. a Better Fiji (NCBBF), whose task was to Part of the new hegemonic process was put together a ‘People’s Charter’—a docu- the rural development program. This was ment that provided for integrated national important for the military because at the time socioeconomic development, security of the coup in 2006, indigenous Fijians saw reform, governance reconfiguration, and the military as pro-Indian and anti-Fijian, socio-cultural cohesion. Instead of targeting especially after the weakening of indigenous only indigenous Fijians, the People’s Charter Fijian institutions such as the Great Council had its designated category broadened to of Chiefs. To appease indigenous Fijians, include marginalised people from all ethnic coup leader, Commodore Bainimarama, groups. used a complex but clever tactical manoeuvre The military also established FICAC as consisting of direct visits and service deliv- a state ‘clean-up’ institution and watchdog ery in the form of roads, bridges and coconut with powers to investigate those suspected bio-fuel plants. This policy has worked of corruption under the FICAC Decree. The wonders, as chiefs and villagers presented ambiguity of its role has made it a convenient their matanigasau (traditional apology) for agent for political witch-hunts of opponents opposing him earlier and promised to sup- of the regime and supporters of the previous port him in his reforms. government. A number of high-profile play- During his visits to the villages, Baini- ers, including the sacked CEO of FHL, former marama emphasised that there would be no prime minister Qarase, and other proponents more Qarase-type ‘handouts’ in referring and beneficiaries of the affirmative action to affirmative action, and that the military programs, have been hauled into court and government will not fund any more com- tried for corruption. The legal processes munity halls and churches but will focus continue. The military has used coercive on economically productive projects, infra- tactics to institutionalise its economic and structure and education. Below is part of a political reforms and remove opposition; and typical speech, as presented to the people the anti-affirmative action has transformed of Ovalau: the connotation of affirmative action from We urge members of the public to something positive to something socially work hard. Stop relying on handouts. regressive and morally evil. This Government will only see that The People’s Charter was more than our roads, water, education and other just a blueprint for development. It was developments are done to move us a framework for social engineering and forward… socio-political reconfiguration as part of the revolutionary process of erasing the old order Government will see that infrastructure and creating a new one with new institutions is maintained to create business and [a] and norms. Apart from the dismantling and better economy for the people of Ovalau reconfiguration of state structures, other and for the future generations… powerful institutions such as the Great

We are committed towards change (IMF), the World Bank and the Asian Devel- and the Charter outlines clearly these opment Bank (ADB), which carried out a changes. We urge you to support these series of consultations with the military gov- changes and maintain the support to ernment on 10–24 November 2009. Amongst whatever Government that will come the recommendations of the team were the into power after elections. (Press re- usual reforms in relation to the rules around lease, Fiji Ministry of Information, 16 land availability for productive use, reform April 2010) of the civil service, public enterprises and In all the development projects, there statutory entities, and liberalisation of the was no mention of affirmative action or economy. They also emphasised social indigenous Fijians as target groups. The protection measures targeted towards the language of development was de-ethnicised poor, to reinforce current programs in the as part of the social engineering process to areas of the family assistance allowance make people think in ‘non-racial’ terms. scheme, poverty alleviation projects, care Terms such as ‘rural and outer island dev- and protection allowances, capital grants elopment’ were used instead of ‘rural indig- to voluntary organisations, and a women’s enous Fijians’, although most of the rural plan of action. development efforts were geared towards Faced with economic contraction and indigenous Fijians. diminished exports, the ambitions of the The only category that did not directly military regime for a vibrant economy can benefit rural indigenous Fijians was ‘multi- be sustained only through external interven- ethnic affairs’. tion. By embracing the IMF’s reform strategy, To bolster indigenous Fijian develop- the military regime showed the level of ment, land reform is now being envisaged desperation in the economy, which needs as a major socioeconomic fulcrum for external financial injection to sustain itself. development. The consequences of IMF reform, especially if the negotiated $1 billion is provided, will Land reform in particular in relation to lock Fiji deeper into long-term debt. resource based sectors is paramount. The reforms are part of the broader Issues pertaining to the ailing sugar development framework encapsulated in the sector, the need to diversify into Ten Point Economic Plan (TPEP), which sets other crops and the imperative to out specific targets to be achieved by 2020. have commercial farming can only These are 1) GDP to be increased twofold; be addressed in a meaningful way if 2) elimination of the current account deficit; more land is available for productive 3) poverty to be reduced from current levels use on [a] long and secure tenure to less than 5 per cent of the population; 4) basis. (Press release, Fiji Ministry of visitor arrivals to increase to six million; 5) Information, 16 April 2010) the financial sector to be liberalised with a Land reform was to be a multi- view to eliminating exchange controls; 6) stakeholder approach involving farmers, communication services sector businesses landowners, government, the Native Land to grow by 100 per cent; 7) self-sufficiency Trust Board (NTLB), funding agencies such to be achieved in rice, meat and liquid as the Fiji Development Board, and the busi- milk production; 8) up to 90 per cent of all ness community. Land reform is to be part electricity generation to be converted from of a larger economic reform program (ERP) fossil fuels to renewable sources; 9) to 80 involving the International Monetary Fund per cent of all arable land to be brought into

186 Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Pacific Economic Bulletin Volume 25 Number 3 © 2010 The Australian National University Vakatorocaketaki ni taukei: thE Politics of affirmative action in Post-colonial fiji

productive use; and 10) the unemployment ously strengthening the power of those loyal rate to reduce to less than 3 per cent (Press to the regime. At the same time, it consoli- release, Ministry of Information, 16 April dated the political support of village-level 2010). indigenous Fijians. Isolating and weakening Ironically, the shift in the affirmative the vocal indigenous middle class, paralys- action paradigm is basically a resurrec- ing the Methodist Church, neutralising tion of the development plans of the late the Great Council of Chiefs, and winning 1970s and 1980s, which clothed affirmative the hearts of the indigenous Fijian villag- action in the language of rural develop- ers were means of controlling the power ment. Unlike the post 1987 and post 2000 of ethno-nationalism at the national and affirmative action policies, after the 2006 grassroots levels and harnessing it to the coup, the pro-indigenous policies were military’s tactical advantage. Contrary to fundamentally integrated into the national his own well-known anti-ethno-nationalist development plan rather than being a sepa- sentiments, Bainimarama has reinvented a rate policy framework. The de-ethnicisation new form of ethno-nationalism amongst of the language did not mean that ethnic indigenous Fijians as a means of justifying preferential intent had disappeared; it the 2006 coup and sustaining his reform simply made it less conspicuous. One of the agenda. distinguishable features between the past affirmative action policies and the current one is the class dimension. Whereas the Conclusion previous ones were targeted at consolidating the indigenous Fijian middle class, the The social engineering intent of Fiji’s post 2006 coup strategy was first to weaken affirmative action—largely imported from the indigenous middle class created after Malaysia—did not work as well as expected. the earlier affirmative action policies and Both countries were ethnically pluralistic at the same time to target the rural poor as with a demographically and politically a designated group. The de-ethnicisation dominant indigenous population, which of affirmative action was an attempt to was also the designated category for de-politicise it. But this did not happen, as affirmative action. Malaysia’s NEP was it led to politicisation of affirmative action seen by Fiji as the ethno-economic model in a different context. of affirmative action to emulate to address The weakening of the indigenous issues of equity and potential conflict. middle class effectively undermines the Amongst the affirmative action pro- powerbase of former prime minister Qarase grams in Fiji derived from the Malaysian and indigenous Fijian ethno-nationalism. model were the setting up of an indigenous After 1987, affirmative action policies had trust corporation, provision for special busi- created a class of wealthy and powerful ness licences, preferential loans, preferential indigenous Fijians who fed on state patron- public service appointments, preferential age and resources. The military regime has scholarships, and the use of state patronage. tried to curtail the power of the middle The major differences, however, were that class and shift the focus of infrastructure in Malaysia the equity shares in the trust development to rural villages. This tactic companies were individually owned while has weakened and isolated those members in Fiji there was a tendency for communal of the middle class suspected of being ownership of equity. Another major differ- opposed to the regime while simultane- ence was that before the 1997 East Asian

financial crisis, the dramatic economic after the 2006 coup when the military tore growth in Malaysia was fuelled by a vibrant up the affirmative action programs on the industrial and resource base, but this was grounds that they were linked to racism not the case in Fiji, where the economy was and corruption. weak and the resources for preferential The most successful affirmative action disbursement were very limited. program in Fiji was in education. The educa- The outcomes were more or less similar. tion quota system expanded the ranks of The indigenous élites became the primary Fijian graduates and, by the 1990s, a large beneficiaries of affirmative action and, indigenous Fijian professional middle instead of addressing ethnic division, class had been formed. At a time when the affirmative action widened ethnic differ- Indo-Fijian middle class was shrinking due ences. In the case of Fiji, ethno-nationalist to emigration, the indigenous middle class passion, which was associated with affirma- diversified, strengthened and helped sustain tive action, contributed further to political the labour market. It also acted as a trans- instability in 2000 when there was fear that formational and at the same time stabilising an Indo-Fijian government would under- political force. Within the indigenous middle mine indigenous Fijian privileges. In 2006, class, however, there were individuals and however, ethno-nationalist policies by the groups who materially and politically ben- Qarase government angered the military efited more than others because of their links and contributed to the military coup. On the with the state bureaucracy and indigenous other hand, affirmative action in Malaysia, political élites in a client–patronage network. under the authoritarian control of an indig- Some of them were given positions as part enous state, maintained a relatively stable of the political payoff for loyalty. For some, political system. articulating the ethno-nationalist slogan and Affirmative action in Fiji has been pro-indigenous policies was a ticket to higher a complex matter involving structural and more secure positions within the state changes—more than simple policy pre- hierarchy. There were also liberal indigenous scriptions. The response to the historical Fijians who opposed the affirmative action interface between ethnicity and class by policies on the grounds that they reinforced the indigenous élites who controlled the the stereotypes of indigenous Fijians as lazy state apparatus necessitated the need for and incapable, and undermined motivation affirmative action in the first place; but, and self-enhancing initiative. over the years, there were significant shifts There were success stories of indigenous in the affirmative action policies as a result Fijians in commerce who were nurtured of regime changes. Since independence, through the affirmative action process. affirmative action has been articulated There were, however, also failures. The post as part of the national development plan; 1987 coup affirmative action policies, while but this changed after the military coup benefiting some individuals and groups, in 1987 when affirmative action was seen were at the mercy of indigenous Fijian élites as an urgent undertaking to transform the who made use of the state patronage system, socio-political and socioeconomic landscape close links to banks and status in the com- to facilitate indigenous Fijian advancement. munity to siphon off benefits for themselves. The process intensified after the 2000 coup, While the military has been investigating as the need to address ethno-nationalist agi- some of these under its ‘clean-boy’ image, tation and instability became a paramount it too has been rocked by scandals. In fact, concern. Everything changed, however, some of the senior officers in the military,

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including cabinet members of the military Note government, were directly involved in the affirmative action scandals of the 1990s. 1 This loan was later converted to a grant by The focus of the post 1987 affirmative the Qarase government; but in September action on embourgeoisement meant that 2010, the Bainimarama military regime poverty and social marginalisation were converted it back into a loan to be repaid to ignored. The State’s solution was to have the government. indigenous Fijians take part in communal and kinship investment schemes, which References yielded very little by way of family income. The affirmative action benefits did not Abbott, D., 2007. Fiji analysis of the really trickle down to the grassroots. While 2002/03 household income and the designated category was indigenous expenditure surveys: estimation of Fijians generally, the actual beneficiaries basic needs poverty lines and incidence were those in the urban indigenous middle of poverty in Fiji, Unpublished draft class. Contrary to the original intentions, final report prepared for United affirmative action merely widened the Nations Development Programme, ethnic rift between the indigenous and Suva. other ethnic groups, as well as exacerbating Agocs, C., 2009. Measures to secure class differences within the indigenous employment equity in the Canadian community itself. labour market, Paper presented to There were high hopes that the post conference on Affirmative Action 2000 affirmative action policies would in the Labour Market: International rectify the situation, but instead, due to lack Perspectives, British Academy, of systematic monitoring, weak manage- London, 2–3 November 2010. ment of the affirmative action governance process and direct political manipulation, Ali, A., 1982. ‘The politics of plural there were high-profile scandals that society’, in R. Crocombe and A. Ali undermined the integrity and reputation of (eds), Politics in Melanesia, Institute of affirmative action as a reliable redistribution Pacific Studies, Suva. program. Bernardino-Costa, J., 2010. Affirmative Paradoxically, while the current military action in Brazil, Paper presented to regime’s anti-affirmative action policy conference on Targeting Horizontal seems to be at odds with the ethno- Inequalities: Affirmative Action, nationalist desire for affirmative action, Identity and Conflict, University of their ultimate aims seem mutual. They both Malaya, Kuala Lumpur. want political stability and the elimination Bobo, L., 1998. ‘Race interests and beliefs of the differences created by the interplay about affirmative action’, American between ethnicity and class. While one tried Behavioural Scientist, 41(April):985– to do it through ethnicity-based affirmative 1,003. action, the other has tried to de-ethnicise the Burn, A., 1963. Fiji, HMSO, London. process using coercion. Chand, S., 2007. ‘50–50 by 2020: poverty and redistributive politics in post independence Fiji’, Pacific Economic Bulletin, 22(2):22–35.

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