In This Issue

SHELL BANKS GIVE THE REGION A BAD NAME: Fly-by-night i A bank operators have been cleaning up by taking advantage of the 1 availability of bank licences in the Pacific islands. Rarely possessing more than a brass plate on an island address, these shady operators are far removed from the reputable and well-funded financial institutions operating in the islands. Now the banking authorities around the world, especially the US, are taking a very close look at shell banks. Our Washington correspondent, David S North, has spoken with US law enforcement agents who say that island states should make bank licences harder to obtain.

VANUATUS WASHINGTON GAMBIT: The mission of on Vanuatu prime minister Fr Walter Uni and foreign minister Mr Sela Molissa to Washington almost came to grief when Fr Uni was hospitalised following a stroke. However, Mr Molissa took over the prime minister’s tight program of meetings and debates. Our Washington correspondent reports that he did so extremely well, impressing many with an air of quiet competence.

SPY IN THE SKY PICTURES: Despite Russian denials, the oo Soviet base at Cam Ranh Bay in Vietnam has been expanded since the Americans abandoned it in 1979. Satellite photo graphs released by the US clearly show Soviet aircraft and naval vessels at an expanded military facility from which the

Soviets can reach most of the Pacific island states. We survey the balance of power in the region and also find that the Russians possibly not deliberately are paying more than good money for fishing rights.

WINDS OF CHANGE IN PLANTATIONS: The sale of Burns 07 Philps PNG plantations marks an important development in how the Forums largest nation develops and funds its agricultural sector. The buyer is majority owned onshore where the purchase finance was raised for the first time. The new owners now look forward to a successful operation after two years of development.

TUNA DEAL DELAY: Bureaucratic hassles are delaying the op final signing of the multilateral tuna treaty negotiated by the US and the island states in Tonga last year. However, there is light at the end of the tunnel though final ratification may still be some way off.

SAGA OF A TOURISM DISASTER: French Polynesia is still pp reeling from the decision by American Hawaii Cruises to 00 withdraw the 720-berth SS Liberte from the 7-day cruises program in the territory. Many hoteliers and tourism industry operators both large and small had invested heavily in extra facilities on the understanding that the cruises would continue for ten years. They lasted less than two. We tell the sad and complicated story.