'It is baseless' - Marshalls President, facing ouster, blames Chinese influence

9:18 am on 9 November 2018

Concern over a proposed utopia for foreign investment in the Marshall Islands has exploded, with the country's president blaming Chinese influence for an impending no confidence vote being brought against her by backers of the project.

On Monday, the Marshall Islands Nitijela, or parliament, will vote on whether to unseat Hilda Heine, the first and only female head of state in the Pacific, after eight senators brought the motion against her.

Hilda Heine, President of the Marshall Islands, addresses the 71st session of the United Nations General Assembly at the UN headquarters in New York on September 22, 2016.

Hilda Heine, President of the Marshall Islands, addresses the 71st session of the United Nations General Assembly at the UN headquarters in New York on September 22, 2016. Photo: DOMINICK REUTER / AFP

According to the motion, plans by Dr Heine's administration to introduce a cryptocurrency as legal tender had tainted the Marshall Islands' reputation.

It also accused her administration of giving unequal treatment to the country's outer islanders.

Senator Casten Nemra, who introduced the motion, said the government had also failed to investigate about $US1 billion illegally removed from the Marshall Islands Trust Fund last year.

Dr Heine told RNZ Pacific the outlined reasons for the no confidence vote were a "smokescreen", attempting to disguise the real issue at hand.

"The vote of no confidence is about the so-called Rongelap Atoll Special Administrative Region, or RASA scheme, which is an effort by certain foreign interests to take control of one of our atolls and turn it into a country within our own country," she said.

Those foreign interests, she said, were Chinese.

The Rongelap scheme

The RASA scheme is an ambitious plan for Rongelap, including a new tax-free shipping port and perks for offshore companies registered in the atoll.

The scheme was unveiled at the Asia World Expo in Hong Kong in April before thousands of investors.

It is a joint-effort between Chinese businessman and Marshallese citizen Cary Yan, the parliamentary speaker, Kenneth Kedi, and Kessai Note, a senator and former president of the Marshall Islands.

The project is understood to have backing from other senators in the Nitijela, including those who signed the no confidence motion.

Draft legislation for the special region, which was recently rejected by Dr Heine's government, would have made the atoll exempt from certain financial provisions of Marshall Islands law.

However the government was concerned it would breach the country's international financial transparency commitments and lead to money laundering.

Rongelap Island, one of the Marshall Islands group.

Rongelap Island, one of the Marshall Islands group. Photo: AFP (file)

Securing Pacific sovereignty

Dr Heine said she had no evidence that Chinese state interests were involved in the project, but that her government had no way of ensuring China would not make a grab for Rongelap and claim it as its own if the project was allowed to go ahead.

"We have to be cautious knowing what the geopolitical situation is in the Pacific region, and I think it's important for the government to do its own due diligence and make sure that the sovereignty of the Pacific is secure," she said.

RASA's backers, including local government officials in Rongelap, had been influenced by Chinese interests to make the no confidence motion in order to push for the project to go ahead, Dr Heine said.

The Marshall Islands remains one of Taiwan's dwindling diplomatic allies, which are under increasing pressure from China to recognise Beijing over Taipei.

"We are a small country and it is easy for foreign elements to influence individual people, and so I think that the more education and information that we share with the public the better so we can see initiatives for what they are," Dr Heine said.

Mr Kedi, the parliamentary speaker and senator for Rongelap, said there was no connection between Rongelap and the no confidence motion.

But observers said Dr Heine's opponents had focused their efforts on issues more likely to succeed in unseating the president, rather than basing the vote on an investor proposal which few people would be familiar with.

"This is a flashpoint in the whole development of the motion of no confidence even though it is not one of the five points that Senator Nemra outlined in his speech supporting the motion," said Giff Johnson, editor of the Marshall Islands Journal.

Dr Heine said she had every confidence her coalition would survive the vote on Monday.

"If you were to take a poll today, my guess is that over 60 percent of the Marshallese [parliament] would come out against the vote of no confidence, because they know it is baseless."

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