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The period July 2004 to June 2005 can be described as a year of many political twisters and natural cyclones that continue to impact economic, political, and social programs in the Cook Islands. The country faced a series of cyclones, one drawn-out general election, several closely fought elections for parliamentary seats, court petitions, relatively regular changes in cabinet ministers and portfolios, two prime ministers, and three governments. The party that won the election resurfaced as the opposition and the prime minister came from one of the smallest constituencies in the country.

June 2004 began on a positive note with a three-day workshop conducted by the Cook Islands Ministry of Foreign Affairs and the Pacific Islands Forum, involving government agencies, nongovernmental agencies, and private-sector companies. The training reflected the spirit of the June 2000 Cotonou Agreement, which marked the start of a new economic and political relationship between theEuropean Union and its African Caribbean Pacific group for the next twenty years. Minister of Finance Tapi Taio described the Economic Partnerships Agreements as important in integrating country development with region-wide economic development and in ensuring that the sustainable development of the Cook Islands actually benefits the people (CIN, 3 June 2004, 6). As part of this developmental process, the Cook Islands government signed an agreement with the governments of Australia and New Zealand. This Cook Islands initiative, the first of its kind in the Pacific Islands, requires the Australian Agency for International Development (AusAID) to pay its financial contribution and a management service fee to the New Zealand Agency for International Development, which "will act as trustee of the funds to be put into projects of the single co-funded program" (CIN, 3 Sep 2004, 1). Loan reserves, projected to reach NZ $20.1 million by 30 June 2006, are also provided so that existing Asian Development Bank loans can be serviced as they come due (CIH, 25 June, 2005, 7).

Planning meetings alone did not ensure financial responsibility, however, and the Ministry of Finance and Economic Development reiterated its warning about overspending and spiraling personnel costs (CIN, 30 June 2004, 1; 17 Jan 2005). Even the Chamber of Commerce warned of economic decline if government continued its overspending (CIN, 9 Mar 2005, 1). Given this general apprehension, the NZ $2.4 million capital expenditure budget set for 2005–06 was already receiving much criticism [End Page 128] from the public at the end of the review period (CIH, 20 June 2005, 2). Director of Audit Paul Allsworth noted that regular departmental overexpenditures were primarily caused by poor planning and political interference (CIN, 17 June 2004, 1.). Ordinarily this problem could be solved through the Public Expenditure Review Committee, which is generally seen as an important part of government's public transparency. But the committee has had much of its budget cut and has no powers to prosecute or expose wrongdoing discovered by its audits (CIN, 29 June 2005, 1).

Economic development remained a major focus for the country, although certain promising enterprises received little public support. Tony Napa unsuccessfully defended his proposal to establish the island's first helicopter service, using a Raven 44 II Clipper helicopter for tourism, commerce, government, and emergency services (CIN, 3 June 2004, 1). Other enterprises carried more public support, including the Captain Bligh resort hotel in Aitutaki being built by the Tepaki group, and Virgin Blue's sister airline, Pacific Blue, flying from Australia via Christchurch to Rarotonga. Meanwhile Aloha Airlines announces it was ceasing its flights into Rarotonga, ending the direct connection to Hawai'i. A bill allowing the issuance of titles to anyone owning a portion of a building without being a lessee (similar to time-sharing) awaits more discussion. Although ownership of tourist accommodations is reserved for Cook Islanders, foreigners can access the industry by purchasing existing businesses that fail to find local buyers.

Overall, the important tourism industry has brought mixed results forthe Cook Islands. Increased Air New Zealand flights have led to more tourists, but also shorter lengths of stay. Lack of leadership and vision in government's management of tourism development is sometimes cited as a major concern...

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Additional Information

ISSN
1527-9464
Print ISSN
1043-898X
Pages
pp. 128-133
Launched on MUSE
2005-12-06
Open Access
No
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