Posts Tagged ‘New Zealand’

Demonstrations in Vietnam should be a wake-up call for China — Distrust of China on the rise?

July 14, 2018

Distrust of China may be on the rise from Vietnam, to New Zealand, Australia and into the Belt and Road nations of South Asia

By Tuan Anh Luc, UNSW Canberra

Since mid-June 2018, numerous anti-China protests have been reported in Vietnam. Demonstrations of this kind have not been seen since the widespread anti-China protests in Vietnam in 2008 and 2014. Protesters rallied to express opposition to the draft law on special economic zones (SEZs) that was to be brought before the National Assembly for consideration.

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Banners held by protestors read things like ‘No leasing land to China even for one day’. Most of the rallies were non-violent, but in Binh Thuan province protestors threw Molotov cocktails and rocks at police. Hanoi asserts that hostile forces incited the demonstrations to destabilise the country.

The draft bill proposes a legal groundwork for establishing three long-planned SEZs. The policy on establishing SEZs has been stipulated in the country’s constitution since 1992. Government leaders in Hanoi describe the bill as a boost for development and as providing Vietnam with ‘room for institutional experiments’. The three SEZs will be granted favourable legal and policy conditions to attract foreign investments. Foreign investors can lease land for up to 99 years.

But the 99-year lease regulation worries many in Vietnam, mostly for national security concerns about the possibility that China’s investment will dominate. Under public pressure, government officials decided to delay a vote on the draft bill until the next session of the National Assembly in October.

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Protesters hold a banner which reads “No Leasing Land to China even for Anytime” during a demonstration against a draft law on the Special Economic Zone in Hanoi, Vietnam June 10, 2018. REUTERS/Staff

SEZs should not be rejected out of hand. Many SEZ models in China, South Korea, United Arab Emirates and Singapore have been successful. They are also not new to Vietnam, but the Cai Bau and Con Dao SEZs in the early 1990s failed, as did the first attempt in Phu Quoc in the mid-1990s and Hai Phong soon after.

Opponents to the draft law argue that the three proposed SEZs would be in areas of strategic importance. Van Don in Quang Ninh province is adjacent to China’s Guangxi province. Bac Van Phong is not far from Cam Ranh Bay, a well-known strategic military port. And Phu Quoc island is only 20 kilometres from the deep-water port that Cambodia leased to China for 99 years in 2016.

Vietnamese concern about Chinese investment sits on firm foundations. Popular anti-China sentiment and distrust of China in Vietnam is based on a collective historical memory of China’s repeated attempts to subjugate Vietnam in the past. Every single Chinese dynasty since Qin Shi Hoang has attempted to invade Vietnam. Memories of Chinese aggression — including in the northern border war in 1979 and the Spratly naval clash (Gac Ma battle) in 1988 — remain fresh in the public’s mind. Informed by this historical memory, anti-China protesters in Vietnam today are concerned that something akin to Russia’s seizure of Crimea could happen between Vietnam and China. According to a 2014 Pew Research survey, only 16 per cent of Vietnamese people hold a favourable view of China.

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Gac Ma memorial marchers

The nature of Chinese overseas investment is also viewed with caution in Vietnam. There are worries about the so-called ‘Chinese debt trap’, whether China cares about the risk of environmental degradation and the tendency for low-skilled Chinese workers to be brought over to work on projects instead of domestic workers.

China’s foreign policy actions over the last 10 years contrast sharply with its charm offensive of the late 1990s and early 2000s. Most noteworthy was China’s show of goodwill in assisting ASEAN during the Asian financial crisis. But since late 2009, especially under the presidency of Xi Jinping, China’s behaviour has aroused concern.

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In the maritime domain, China has been and continues to be defiant to international law and increasingly assertive in the South China Sea — not to mention China’s refusal to accept the ruling on the South China Sea awarded by the Arbitral Tribunal two years ago even though it is a party to the United Nations Convention on the Law of the Sea 1982. In addition, China has built seven artificial islands on different features in the Spratly and the Paracel archipelagos over the last several years. More recently, China installed anti-ship cruise and surface-to-air missile systems on three artificial islands in the Spratlys, and landed H-6K nuclear bombers on Woody Island in the Paracels. Admiral Philip Davidson, Commander of the newly renamed Indo-Pacific Command, told the US Senate Armed Services Committee that ‘China is now capable of controlling the South China Sea in all scenarios short of war with the United States’.

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Chinese military exercising on Islands in the South China Sea

Problems with China’s overseas investments have spurred anti-China sentiment elsewhere in the region, as shown in several protests in Thailand, the Philippines, and Myanmar in the last few years. The low quality of made-in-China infrastructure projects, concern about China’s extensive use of Chinese labourers in its overseas projects and increasing anxiety over a ‘Chinese debt trap’ continue to be obstacles to Beijing’s Belt and Road Initiative (BRI). China’s militarisation in the South China Sea has also undermined strategic trust in the region and raised concerns about participation in China’s ambitious BRI plan.

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Anti-China protests in Vietnam should not be perceived solely as a domestic issue, but part of a wider regional political and security dynamic. Hanoi must draw its own lesson from the recent anti-China protests about the importance of clear communication with its public regarding new laws. Its challenge moving forward is to strike a nuanced balance between economic growth and national security considerations. Given the mixed success of its previous SEZ models, Hanoi should proceed with caution.

For its part, China should not arrogantly label the protests in Vietnam as ‘illegal gatherings’ but instead consider them as a wake-up call to the unfriendly, if not wrong-headed, Chinese approach to public diplomacy. Currently it seems that Southeast Asian perceptions of Chinese activities undermine its claim to a peaceful rise.

Tuan Anh Luc is a PhD Candidate in the School of Humanities and Social Sciences at the University of New South Wales, Canberra.



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China says it has sovereignty over all the South China Sea north of its “nine dash line.” On July 12, 2016, the Permanent Court of Arbitration  in The Hague said this claim by China was not valid. But China and the Philippine government then chose to ignore international law. Vietnam has been unable to develop its own undersea oil due to China’s aggressive behavior.



New Zealand Government stands by the words used to describe China’s presence and will not be correcting any “wrong words.”

July 11, 2018

China has lodged “stern representations with New Zealand” after the Defence Force explicitly named China as a threat before spending $2.3 billion on anti-submarine aircraft.

China’s Foreign Ministry Spokesperson Hua Chunying told a press conference on 9 July China is a “builder of world peace.”

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U.S. P-8 Maritime surveillance aircraft

“We urge New Zealand to view the relevant issue in an objective way, correct its wrong words and deeds and contribute more to the mutual trust and cooperation between our two countries,” Ms Hua told the conference.

The New Zealand Government stands by the words used to describe China’s presence and will not be correcting any “wrong words.”

“New Zealand is a sovereign nation and whether the United States was telling us to do that or China or any other country, it comes down to our right to see things as we see it in a very responsible way,” Acting Prime Minister Winston Peters said on Wednesday.

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Acting Prime Minister Winston Peters

He said there is “no connection in real terms” to trade, so is not concerned about retaliation in that sphere.

The strategic defence paper released last week directly warned of the increasing influence of China. It said while populism is causing some countries to look inward, China is outward-facing.

“China has set an alternative model of democracy – a liberalising economy absent liberal democracy – challenging conventional wisdom in the West that the two go hand-in-hand,” the strategic policy statement says.

The document also warned of Russia’s influence, particularly with cyber technology, and of uncertainty around the United States’ role internationally.

On Monday, Mr Peters danced around directly mentioning China when asked about the Government’s decision to purchase four Boeing P-8 Poseidons. The aircraft are designed for, among other specs, “long-range anti-submarine warfare.”

When asked about the decision, Mr Peters told media to “join the dots” on the “one party that’s responsible” for the militarisation of the South China Sea.

He acknowledged China had registered concern over the paper through its ambassador in New Zealand and New Zealand’s ambassador in China.

New Zealand is hardly the first country to purchase the aircraft – they are also used by Australia, the United Kingdom and the United States.


New Zealand Buys Boeing Surveillance Jets to Counter Chinese Buildup

July 9, 2018

U.S. ally approves $1.5 billion purchase of four Boeing P-8A Poseidons

A U.S. Navy P-8A Poseidon maritime patrol aircraft sits on the tarmac in Lossiemouth, U.K.
A U.S. Navy P-8A Poseidon maritime patrol aircraft sits on the tarmac in Lossiemouth, U.K. PHOTO: JANE BARLOW/ZUMA PRESS

New Zealand said it would buy four submarine-hunting surveillance jets, the country’s biggest military purchase in decades, as it seeks to counter a Chinese buildup in the Pacific that has worried the U.S. and its allies.

New Zealand’s government on Monday approved the $1.5 billion purchase of Boeing Co. P-8A Poseidons used by the U.S. and its military allies including the U.K., Australia and South Korea.

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“We are stepping up and being responsible in the Pacific,” said Winston Peters, who is acting prime minister while Jacinda Ardern is on parental leave. Beijing has previously accused Mr. Peters, the populist leader of New Zealand First, which is a minor party in Ms. Ardern’s center-left government, of being “anti-Chinese.”

The deal announcement comes just days after the small island nation unveiled a new defense blueprint warning that an “increasingly confident” Beijing was testing international rules and stability in “newly potent ways.”

New Zealand scrapped its combat air force about 15 years ago to save money. The P-8 deal comes as a more assertive China expands its military, diplomatic and economic reach across an arc stretching from Africa through the Indian Ocean to the Pacific.

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The deal increases New Zealand’s patrol and intelligence gathering abilities in a region expected to be home to half of the world’s submarines in a few decades, as China’s naval expansion accelerates an Asian arms race. The Poseidon can track ships and submarines across vast areas of ocean, deploying missiles, depth charges and torpedoes from a rotary launcher to sink them if necessary. The four aircraft will begin operations in 2023.

Mr. Peters, who is also New Zealand’s foreign minister, said recently the country needed to use “all the levers at its disposal to advance our national interests and protect our sovereignty” against a backdrop of rising U.S.-China tensions, the militarization of South China Sea atolls, and Beijing’s growing Pacific sway.

Australia and New Zealand are negotiating a security pact with small South Pacific island nations as a counter to the growing influence of China and Russia over regional economies including Fiji and resource-rich Papua New Guinea. China in particular has been courting island governments through a mix of aid and infrastructure loans.

“Great Power competition is back,” Mr. Peters said last month. “This government is determined to have the tools to defend and advance New Zealand’s interests.”

Robert Ayson, an expert from New Zealand’s Centre for Strategic Studies, said the choice of submarine hunting P-8s to replace a fleet of six 50-year-old Lockheed Martin Corp. P-3 Orions, signals a fresh willingness to help maintain maritime security in the Pacific.

“New Zealand’s position had firmed up. It’s more willing to say things about China that are a bit critical,” Prof. Ayson said. “If New Zealand, like Australia, feels that the maritime and strategic environment is deteriorating…then you need the P-8 to show New Zealand is willing to deploy [its military] in and beyond the Pacific.”

Write to Rob Taylor at

New Zealand warns of security risk from China’s influence in Pacific — Warns of “Unwanted Chinese meddling”

July 6, 2018

New Zealand warned in a defense report on Friday that China’s rising influence in the South Pacific could undermine regional stability, in comments likely to stoke bilateral tension.

New Zealand and Australia have traditionally held the most influence in the South Pacific, but the New Zealand government said in the report it was now losing its sway over small island nations to China.

“New Zealand’s national security remains directly tied to the stability of the Pacific. As Pacific Island countries develop … traditional partners such as New Zealand and Australia will be challenged to maintain influence,” the government read.

“China holds views on human rights and freedom of information that stand in contrast to those that prevail in New Zealand.”

New Zealand has announced it would increase foreign aid by nearly a third, in part to counter China’s rising influence in the South Pacific.

“We live in turbulent times, the world is changing and there has been a re-emergence of great power competition,” New Zealand Defense Minister Ron Mark told reporters in Wellington.

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New Zealand Defense Minister Ron Mark

Australia is the largest donor of aid to the Pacific, committing A$166.4 million ($129 million) this year. But with a large budget deficit, its economic aid budget will fall, opening a door for China, analysts say.

Chinese economic aid to the region is growing significantly, according to Australian think-tank the Lowy Institute, with an estimated $1.78 billion spent in the decade to 2016.

China has denied that it is using its aid to exert influence in a region blessed with significant natural resources.

But Australia’s outgoing defense chief, Mark Binskin, cited “the influence of some nations starting to come down into the southwest Pacific” as among his concerns, in an interview with Fairfax Media published on Friday.

“I don’t think there is trust there,” he added, referring to China’s military building up on tiny islands and shoals in the South China Sea despite promises it would not.

In February, Taiwan accused China of pressuring Papua New Guinea, a large recipient of Chinese aid, to downgrade relations.

Australia, citing its suspicion of Chinese meddling in its politics, last month passed tough legislation seen as limiting China’s reach.

China has denied any such meddling.


Australia plans to spend a significant portion of its Pacific aid budget building high-speed internet cables for Papua New Guinea and the Solomon Islands, and will bolster cyber security for Vanuatu, to counter China’s growing influence.

Pacific Island leaders, including those from Australia and New Zealand, will meet in September on Nauru island for an annual summit, where a new agreement covering defense, law and order, humanitarian assistance is expected to be signed.

Reporting by Colin Packham. Additional reporting by Tom Westbrook; Editing by Michael Perry, Robert Birsel

Diplomatic Setbacks From China to Taiwan Mean It’s Time To Normalize Taiwan’s Sovereign Status

June 5, 2018

Taiwan’s loss of two diplomatic allies in less than a month has sparked concern among the public and government officials over the nation’s future, its dire diplomatic situation and China’s intensifying efforts to squeeze Taiwan’s international space.

However, as former US president John F. Kennedy once said: “In the Chinese language, the word ‘crisis’ (危機) is composed of two characters, one representing danger and the other, opportunity,” and things are not as hopeless as they seem.

There is a silver lining to the series of diplomatic setbacks Taiwan has faced: Beijing has given Taiwan the opportunity to internationalize its situation and tell the world that the cross-strait dispute is not a matter of China’s “internal affairs.”

The Taipei Times

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Thanks to Beijing’s poaching of Taiwan’s diplomatic allies and blocking it from taking part in international events, such as the World Health Assembly (WHA), more nations have become publicly involved and more active in matters concerning Taiwan.

Case in point one: For the first time ever, Canada and New Zealand voiced their support for Taiwan to be granted observer status at this year’s WHA. Representatives from Germany, Honduras and Japan made open calls during their speeches for Taiwan’s participation at the WHA, while the EU also voiced its support for Taiwan.

Case in point two: The US Congress has introduced bills aimed at enhancing bilateral exchanges with Taiwan, the latest of which — the “Taiwan defense assessment commission act” introduced by US Representative Donald Bacon — proposes strengthening the US’ commitment to boost Taiwan’s self-defense capability.

Beijing might not care whether the Taiwan issue is being internationalized, but given that more nations are openly supporting Taiwan’s international participation, Taipei should seize the opportunity to make its situation known internationally.

As President Tsai Ing-wen (蔡英文) has said, to which the US Department of State concurred, China is changing the cross-strait “status quo” by poaching Burkina Faso.

In an impromptu news conference called on Thursday evening after Burkina Faso announced that it was cutting diplomatic ties with Taiwan, Tsai departed from her practice of calling China “mainland China” and called it only “China.”

She also referred to Taiwan as “Taiwan” numerous times, rather than calling it the “Republic of China” (ROC).

That is a good start in Taiwan’s response to Beijing changing the cross-strait “status quo.”

To break through China’s obstruction and the title of the “ROC,” which has jeopardized Taiwan’s sovereign status and international standing, the government needs to be more proactive.

For example, it should do away with the Mainland Affairs Council and put it under the jurisdiction of the Ministry of Foreign Affairs.

It is time for the government to consider writing a new Constitution to rid Taiwan of the remnants of the ROC, which have caused confusion in the international community.

The ROC legacy, which includes Beijing’s “one China” principle, is a leftover from the Cold War era and from the bad blood between the Chinese Communists and Nationalists.

Taiwan’s status is still “undecided” according to the 1951 San Francisco Peace Treaty, which only states that “Japan renounces all right, title and claim to Formosa and the Pescadores.”

Now that China has changed the cross-strait “status quo,” Taiwan should seek ways to “normalize” the nation’s sovereign status and rid itself of the remnants of the ROC.

Basis for FBI Probe On Trump? Slim to None (That we know of)

June 1, 2018

His story about the Papadopoulos meeting calls the FBI’s into question.

The Curious Case of Mr. Downer

High Commissioner of Australia to the United Kingdom Alexander Downer arrives at Downing Street in central London on March 22, 2017.
High Commissioner of Australia to the United Kingdom Alexander Downer arrives at Downing Street in central London on March 22, 2017.PHOTO: DANIEL LEAL-OLIVAS/AGENCE FRANCE-PRESSE/GETTY IMAGES


To hear the Federal Bureau of Investigation tell it, its decision to launch a counterintelligence probe into a major-party presidential campaign comes down to a foreign tip about a 28-year-old fourth-tier Trump adviser, George Papadopoulos.

The FBI’s media scribes have dutifully reported the bare facts of that “intel.” We are told the infamous tip came from Alexander Downer, at the time the Australian ambassador to the U.K. Mr. Downer invited Mr. Papadopoulos for a drink in early May 2016, where the aide told the ambassador the Russians had dirt on Hillary Clinton. Word of this encounter at some point reached the FBI, inspiring it to launch its counterintelligence investigation into the Trump campaign on July 31.

Notably (nay, suspiciously) absent or muddled are the details of how and when that information made its way to the FBI, and what exactly was transmitted. A December 2017 New York Times story vaguely explains that the Australians passed the info to “American counterparts” about “two months later,” and that once it “reached the FBI,” the bureau acted. Even the Times admits it’s “not clear” why it took the Aussies so long to flip such a supposedly smoking tip. The story meanwhile slyly leads readers to believe that Mr. Papadopoulos told Mr. Downer that Moscow had “thousands of emails,” but read it closely and the Times in fact never specifies what the Trump aide said, beyond “dirt.”

When Mr. Downer ended his service in the U.K. this April, he sat for an interview with the Australian, a national newspaper, and “spoke for the first time” about the Papadopoulos event. Mr. Downer said he officially reported the Papadopoulos meeting back to Australia “the following day or a day or two after,” as it “seemed quite interesting.” The story nonchalantly notes that “after a period of time, Australia’s ambassador to the US, Joe Hockey, passed the information on to Washington.”

My reporting indicates otherwise. A diplomatic source tells me Mr. Hockey neither transmitted any information to the FBI nor was approached by the U.S. about the tip. Rather, it was Mr. Downer who at some point decided to convey his information—to the U.S. Embassy in London.

That matters because it is not how things are normally done. The U.S. is part of Five Eyes, an intelligence network that includes the U.K., Canada, Australia and New Zealand. The Five Eyes agreement provides that any intelligence goes through the intelligence system of the country that gathered it. This helps guarantee information is securely handled, subjected to quality control, and not made prey to political manipulation. Mr. Downer’s job was to report his meeting back to Canberra, and leave it to Australian intelligence. We also know that it wasn’t Australian intelligence that alerted the FBI. The document that launched the FBI probe contains no foreign intelligence whatsoever. So if Australian intelligence did receive the Downer info, it didn’t feel compelled to act on it.

But the Obama State Department did—and its involvement is news. The Downer details landed with the embassy’s then-chargé d’affaires, Elizabeth Dibble, who previously served as a principal deputy assistant secretary in Mrs. Clinton’s State Department.

When did all this happen, and what came next? Did the info go straight to U.S. intelligence? Or did it instead filter to the wider State Department team, who we already know were helping foment Russia-Trump conspiracy theories? Jonathan Winer, a former deputy assistant secretary of state, has publicly admitted to communicating in the summer of 2016 with his friend Christopher Steele, author of the infamous dossier.

I was unable to reach Mr. Downer for comment and do not know why he chose to go to the embassy. A conservative politician, he was Australia’s longest-serving foreign minister (1996-2007). Sources speculate that he might have felt his many contacts justified reaching out himself.

Meanwhile, something doesn’t gel between Mr. Downer’s account of the conversation and the FBI’s. In his Australian interview, Mr. Downer said Mr. Papadopolous didn’t give specifics. “He didn’t say dirt, he said material that could be damaging to her,” said Mr. Downer. “He didn’t say what it was.” Also: “Nothing he said in that conversation indicated Trump himself had been conspiring with the Russians to collect information on Hillary Clinton.”

For months we’ve been told the FBI acted because it was alarmed that Mr. Papadopoulos knew about those hacked Democratic emails in May, before they became public in June. But according to the tipster himself, Mr. Papadopoulos said nothing about emails. The FBI instead received a report that a far-removed campaign adviser, over drinks, said the Russians had something that might be “damaging” to Hillary. Did this vague statement justify a counterintelligence probe into a presidential campaign, featuring a spy and secret surveillance warrants?

Unlikely. Which leads us back to what did inspire the FBI to act, and when? The Papadopoulos pretext is getting thinner.

New Zealand privacy watchdog seeks greater power over Facebook — Where GDPR doesn’t go…

May 31, 2018

New Zealand Privacy Commissioner John Edwards said he was seeking new enforcement provisions as part of an overhaul of privacy laws now being considered by parliament — New Zealand’s privacy laws, created in 1993, are currently being rewritten

In April, Facebook said that it was changing its terms of service agreements so that its 1.5 billion members in Africa, Asia, Australia and Latin America would not fall under the European Union’s strict General Data Protection Regulation, which took effect on May 25. (Reuters)
New Zealand’s top privacy enforcer is seeking greater powers to regulate Facebook as the social media giant grapples with a tough new privacy regime in Europe and investigations around the globe over its handling of personal data.
New Zealand Privacy Commissioner John Edwards said he was seeking new enforcement provisions as part of an overhaul of privacy laws now being considered by parliament.
Edwards and Facebook have been at loggerheads over whether the tech giant was bound by New Zealand law since March, when Edwards asserted the US company had broken local rules by refusing a request by a New Zealand citizen to access personal information held on the accounts of other users.
“What we did with Facebook is issue a legally binding demand and they just ignored and thumbed their nose at it and refused to comply,” Edwards said in an interview this week.
Facebook declined to comment. In March it said it was disappointed in the decision and that the commissioner had made a “broad and intrusive request for private data.”
Facebook had argued that customers in New Zealand were governed by Irish privacy law, along with most other non-US users.
But in April Facebook confirmed that it was changing its terms of service agreements so that its 1.5 billion members in Africa, Asia, Australia and Latin America would not fall under the European Union’s strict General Data Protection Regulation (GDPR), which took effect on May 25.
Instead, Facebook now specifies that international users are subject to US privacy laws. There are 2.5 million Facebook account holders in New Zealand, according to the privacy commissioner out of a population of around 4.5 million.
The question of how local laws apply to multinational Internet companies with large numbers of customers in scores of countries is an increasingly fraught topic as governments seek greater control on issues ranging from privacy to hate .
New Zealand’s privacy laws, created in 1993, are currently being rewritten.
Edwards was expected this week to ask parliament to grant hspeechis office powers similar to that of other regulators, including the ability to take companies to court and seek fines.
He said he was watching the outcome of international regulators’ investigations into the scandal involving Facebook and the now-defunct political consulting firm Cambridge Analytica, before deciding whether to open his own inquiry.
But, in the meantime, Edwards said he had deleted his personal Facebook account, concerned that the terms of agreement had changed so many times that he no longer had control of a “reservoir” of personal information and wanted a “re-set.”
He detailed the process on popular news website The Spinoff.
“I just wanted to explain to people how they could re-assert their autonomy and their control over their own personal information,” he said.
“Freedom consists not in doing what we like, but in having the right to do what we ought.” – Pope John Paul II.
The “Don’t Ask, Don’t Tell” Problem with Data Privacy in Tech By Jude McColgan

Chinese property investment in Australia plummets

May 29, 2018

Tougher rules, taxes, fees and capital controls cause dramatic fall in investment approvals

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Chinese investors have been avid purchasers of Australian property, such as this Sydney tower block bought by China Investment Corporation in 2015 © Reuters

Jamie Smyth in Sydney

The level of government approvals for Chinese investment in Australian property has halved following the imposition of tougher rules, fees and higher taxes over fears that foreign investors were pushing up house prices.

Figures published on Tuesday by Australia’s Foreign Investment Review Board show overall approvals of mainland Chinese investment across all sectors of the economy fell for the first time in six years.

In the year to June 30, 2017, authorities approved A$38.8bn ($29.2bn) in investment proposals by Chinese investors, compared to A$47.3bn a year earlier. The decline was mainly due mainly to a sharp dip in property approvals which fell to A$15.2bn, down from A$31.9bn.

David Irvine, chairman of FIRB, said the most significant cause of the reduction in the number and value of residential property applications was the introduction of application fees in 2016-17, which meant investors applied only for properties they definitely intended to purchase.

“Other factors that may also have contributed to a reduction in the applications include tighter Chinese capital controls, weaker market conditions and additional taxes,” he said.

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Australia is one of a growing number of countries tightening their foreign investment rules in response to record levels of Chinese inflows over recent years, particularly in residential and commercial property. The city of Vancouver in Canada has imposed a 15 per cent tax on foreign homebuyers and New Zealand is drawing up legislation to ban foreigners buying existing properties.

House prices in Sydney and Melbourne surged 70 per cent and 50 per cent respectively in the five years to October 31, 2017, prompting authorities to introduce a range of fees and taxes on foreign buyers. But prices in Australia’s two biggest cities have begun to moderate in recent months.

“In early 2017, capital controls, financing restrictions, and foreign buyer taxes reduced Chinese investment to more reasonable levels,” said Carrie Law, chief executive of, a Chinese overseas property portal.

Publication of FIRB’s annual report was delayed this year due to difficulties in reconciling approvals data, which covers government approvals rather than actual investment levels.

But the dip in real estate approvals corresponds with other reports, including National Australia Bank’s quarterly property survey, which found the share of foreign buyers fell to a six-year low of 8.4 per cent in the third quarter of 2017, compared to a record high of 17 per cent in the third quarter of 2014.

However, the most recent survey saw a slight uptick to 10.9 per cent in the three months to March 31.

Alan Oster, an NAB economist, said he expected the falls in property investment by foreigners to continue. “I don’t think this is a bad thing as the apartment market already looks overbuilt,” he said.

The reduction in government approvals for Chinese investors has occurred at a time of rising political tension between China and Australia, which has caused some business leaders to warn it could hit the economy.

Australian authorities have also heightened scrutiny on foreign purchases of property, identifying 549 purchases that were in breach of FIRB rules in 2016-17, up from 260 a year earlier.

US investors gained approval for A$26.4bn investment in Australia, ranking it the second-largest investor in 2016-17.…/0e1e411c-62ed-11e8-90c2-9563a0613e56


The race to own Antarctica

May 24, 2018

Competition for natural resources, research and tourism is putting pressure on the cold war-era treaty that guarantees order on the continent

© FT montage / AFP | View of China’s military base in the King George island, in Antarctica.

Leslie Hook in London and Benedict Mander in Buenos Aires

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Antarctica is a continent with no government. The closest thing it has is a drab, 10-person office, with a small sign on its wooden door in Buenos Aires that reads “Secretariat of the Antarctic Treaty”. This is the group whose job it is to keep things running smoothly among the 53 nations that together govern Antarctica.

If that sounds like a quixotic system for a continent twice the size of Australia that contains vast untapped natural resources, it is. But the idealism underpinning it is very clear.

“One of the amazing things is that Antarctica is the only continent where people work together for peace and science,” says Jane Francis, head of the British Antarctic Survey, who last week attended the annual Antarctic Treaty Consultative meeting that brings all of the nations together. “You wouldn’t believe that 53 nations after two weeks can agree . . . It can be done in this world.”

However, not everyone does agree. And at last week’s meeting in the Argentine capital some of those divisions were on show. There is a growing number of issues that the Antarctic Treaty System, which has kept order on the continent for almost six decades, is struggling to deal with. From climate change to fishing, new geopolitical tests are facing Antarctica that are increasingly difficult for a consensus-based group to address.

“One of the things the treaty system needs is almost like a new kind of vision,” says Klaus Dodds, a professor of geopolitics at London’s Royal Holloway University, and an expert on Antarctic governance. “One where parties are explicit about what they are trying to do.”

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China’s base, King George Island, Fildes Bay, Antarctica

The Buenos Aires meeting was typical: it produced a series of agreements that represented relatively low-hanging fruit, such as new rules for drone use, and guidelines for heritage sites (like the hut built by Ernest Shackleton and his team more than 100 years ago).

But the thorniest issues — for example, what happens when countries violate the treaty rules — are almost never addressed. Scientists and diplomats are growing concerned that the existing system will be unable to respond to the new pressures. At stake is the last pristine continent, one that contains the world’s largest store of freshwater, huge potential reserves of oil and gas and the key to understanding how quickly climate change will impact the world through rising sea levels.

“What we are seeing at the moment . . . is almost like a lethargy among the treaty parties to take the necessary steps,” says Daniela Liggett, professor of geography at New Zealand’s University of Canterbury. The last major binding protocol in the treaty system came into force 20 years ago, she adds. Any new protocol must be approved by consensus, so even one dissenting country effectively has veto power.

The greatest areas of tension are those that touch on the growing economic and strategic interests in Antarctica, such as tourism and fishing (mining is banned). Signatories to the treaty, which dates back to 1959, agree to set aside their territorial claims, and use the continent only for peaceful purposes.

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However the growing number of signatories has made the system unwieldy: In 1980 there were just 13 countries that had “consultative” status to make the key decisions on treaty matters — today that number has risen to 29, a diverse group ranging from Finland to Peru, India and Belgium. Meanwhile the number of permanent scientific research stations on the island, a proxy for activity, has grown to more than 75. China has been a particularly enthusiastic builder of new research stations since it joined the treaty in 1983, and the environmental approvals for its latest, a fifth base, have caused division among the treaty members.

“Resources have always been the big trigger,” says Prof Dodds. “Once you get more explicit about resource exploitation, then you raise the troubling issue of who owns Antarctica. That’s the issue that haunts the Antarctic Treaty, and the Treaty System more generally.”

Those anxieties are growing in tandem with Antarctica’s importance. The continent is covered in an ice sheet up to a mile thick and represents a window into how the planet is changing. Temperatures in some parts of Antarctica are rising much faster than the global average, and the pace of glacial melting there will help determine how quickly global sea levels rise in future.

The Southern Ocean, which surrounds Antarctica, is becoming a significant fishing ground, as resources in other seas are depleted. And it plays a crucial role in absorbing heat and carbon from the atmosphere, in ways that are not yet fully understood.

“Things have changed profoundly,” says Damon Stanwell-Smith, a marine biologist who first visited Antarctica more than 25 years ago. “It is visible in a human lifetime — the change in coastal waters, ice, retreat of glaciers, and then the related wildlife movement. Nowhere else has it been so obvious.”

A critical factor is the addition of many more visitors. Mr Stanwell-Smith heads the International Association of Antarctica Tour Operators (Iaato), the closest thing the region has to a tourist police.

The race to understand Antarctica

Last month the association reported that the number of visitors to the region rose to more than 51,000 last season an increase of 17 per cent on the previous year. That number is expected to keep growing. Some 20 new polar expedition vessels are under construction, adding to the 33 already registered with Iaato, to serve the growing interest, says Mr Stanwell-Smith.

For most tourists — who pay between $10,000 and $100,000 for a trip — visiting Antarctica involves stepping off the boat at just a handful of highly regulated landing sites. But there are loopholes in the system, such as private yachts that flout permitting rules, as well as a growing number of tours that involve activities such as kayaking or skiing.

“It’s becoming a bit of an adventure playground, and the trouble is the unregulated tourism,” says Prof Francis, at the British Antarctic Survey. “It has become much easier for people just to sail their yachts to Antarctica, to fly their private aircraft to Antarctica.”

The fastest-growing source of new visitors last year was China, which was second only to the US in the ranking of total tourists. At the same time Beijing is investing heavily in polar missions to Antarctica, part of its plan to become a “polar great power” — moves that have not always been welcome. One idea that has been met with concern is China’s proposal for a special “code of conduct” that would apply for a large area around its Kunlun Station research base, which has been seen as an attempt by China to limit activities near its base.

The construction of China’s fifth research base has also been controversial because preliminary building activities were started before the environmental impact assessment was complete, in violation of protocol. The lack of punishment for these — and similar infractions by other countries — is one of the weaknesses of the treaty system.

China spends more on its Antarctic research programme than any other country, according to Anne-Marie Brady, professor of political science at the University of Canterbury and editor of The Polar Journal. China’s interest is not limited to the potential natural resources available, but also the continent’s strategic importance — having a ground station near the South Pole can increase the accuracy of global satellite navigation systems.

Image result for antarctic, sea meets ice, photos

The US, Russia and China all have critical infrastructure in Antarctica to aid their global positioning systems. “That makes Antarctica very, very interesting right now,” says Prof Brady. She adds that the Antarctic Treaty System may be poorly equipped to respond to a growing “clash of values” in the region.

“There is a lot that is unresolved [in the treaty] and may not be fit for purpose for our current global strategic environment,” she says. “If the Antarctic Treaty is going to be sustainable, there has to be more high-level attention paid by government on how to adjust to the changing environment and how to protect Antarctica.”

The Chinese Arctic and Antarctic Administration declined a request for an interview.

China and other countries are positioning themselves for a day when the current confines of the Antarctic Treaty System may no longer apply. While it does not technically expire, the provisions on the treaty that ban mining could change after 2048 — the year in which the environment protocol is expected to come up for review.

As the number of signatories has expanded it means there will be far more voices involved in any potential review. “What role do these countries [not among the 12 original signatories of the 1959 treaty] intend on playing? For sure, they have one eye focused on the resources that might be available in the future,” says Máximo Gowland, Argentina’s director for Antarctic foreign policy.

He points out that both water and mineral resources could become an issue. “You don’t know how quickly the situation might evolve,” he says, mentioning the severe water shortages in Cape Town, where the idea of towing an iceberg from Antarctica to South Africa, to ease the crisis, was discussed.

Already the treaty system is struggling to protect resources in the Southern Ocean, where fishing for krill is on the rise. Opposition from China and Russia has repeatedly delayed the creation of new marine protected areas, a topic that will be discussed again at the next meeting in October.

Image result for Princess Elisabeth Antarctica Research Station, photos

Princess Elisabeth Antarctica Research Station

Another unresolved issue is bio-prospecting — taking biological samples from Antarctica to study in a lab. Because the species that exist in Antarctica are adapted to extreme cold conditions, they could contain compounds with valuable commercial or pharmaceutical applications. Yet the question of who owns the intellectual property from these samples is impossible to solve, because of the many and varied sovereign claims on the continent.

While there is no indication that anyone is about to take the step of quitting the Treaty System, there is equally little hope that it will be able to reform itself. A risk is that it simply becomes less relevant as it fails to address the challenges facing the continent, says Prof Liggett.

Evan Bloom, the top polar diplomat in the US, which sends the largest number of scientists and tourists to Antarctica each year, says Washington supports the treaty system despite its limitations. “It has worked quite well in terms of setting aside those political differences, and allowing science to occur,” he says.

How much longer that continues to be the case will rely on a fragile treaty that is about to face its greatest tests.

‘Limited friction’: Tradition of co-operation endures on the continent 

The Antarctic Treaty, signed in 1959 at the height of the cold war, was focused on denuclearising the continent and avoiding military conflict, and the 12 original signatories all agreed to set aside any territorial claims there for the duration of the treaty. Subsequent agreements addressed issues like fishing rights and extraction of resources (which is banned), creating a group of deals called the Antarctic Treaty System.

“There are these aspects of the Antarctic Treaty that were unquestionably pioneering,” says Prof Dodds, who describes the treaty as an experiment in human governance.

Eight years after it was signed, it was used as a loose model for the Outer Space Treaty, and is still seen as a template for how to govern areas that fall outside of traditional national boundaries. Today diplomats wonder if it could be a model for the Arctic region, where climate change has opened up new shipping routes and created new sources of tension.

Evan Bloom, the head of the US Office of Oceans and Polar Affairs, says that many of the geopolitical tensions in the rest of the world are filtered out in Antarctica. Everyone who endures the South Pole’s harsh climate has to rely on their neighbours to survive.

“Those frictions are relatively limited in part because the tradition of co-operation in Antarctica flows from the way that the science programmes relate to each other,” he says. “If you are running a science camp or a research station in a remote place, you have a real incentive to work with other nearby stations, regardless of their nationality.”

Mr Bloom says occasionally his colleagues at the US state department will ask him whether similar models could be applied in other parts of the world. “Middle East peace negotiators come and say, this Antarctic Treaty System has worked out really well, is there something we can apply,” he says with a laugh.


Anger Over Tourists Swarming Vacation Hot Spots Sparks Global Backlash

May 22, 2018

QUEENSTOWN, New Zealand—Towering mountain ranges, forests and glacier-fed rivers made New Zealand the perfect stand-in for Middle Earth in “The Lord of the Rings” movie series and a cinematic billboard for the country’s natural beauty.

Today, jet boats rip down rivers seeking the mythical Isengard, where the wizard Gandalf was imprisoned. “Freedom campers” in rented vans leave trails of waste. Tens of thousands of helicopter trips annually deposit visitors, some in flip-flops, on New Zealand glaciers that were once the realm of expert climbers.

One tour group had to be rescued after trying to walk barefoot to Mount Ngauruhoe, in apparent homage to J.R.R. Tolkien’s Mount Doom.

Tourists on an ice plateau above Milford Sound.
Tourists on an ice plateau above Milford Sound. PHOTO: RACHEL PANNETT/THE WALL STREET JOURNAL

Elected officials are weighing measures from new tourist taxes to tighter camper-van restrictions. One town is considering shutting Wi-Fi at night to deter campers. Queenstown, whose mayor says it has 120 visitors a year for every taxpayer, is weighing whether to restrict Airbnb rentals.

On Waiheke Island off Auckland, protests broke out last year after double-decker tour buses appeared, clogging two-lane roads. One man in shorts stood down a bus until the tourists disembarked. A resident elsewhere became so annoyed with jet boats in a river near his property he hired a digger to divert the water; officials threatened legal action if he persisted.

Tourism, which many countries once considered a business niche that could yield easy revenue, has become a mega-industry. And those millions of tourists who descend each year on small towns, once-lonely beaches and historic sites are generating a global backlash.

A helicopter flight to the ice plateau above Milford Sound. Tour buses crowd Queenstown’s streets. The peaks rising behind a Chinese group, about to begin a jet-boat tour on the Dart River near Queenstown, became the Misty Mountains in ‘Lord of the Rings.’PHOTOS: RACHEL PANNETT/THE WALL STREET JOURNAL

International tourist arrivals globally grew to 1.3 billion in 2017, the United Nations’ World Tourism Organization says. That is up from 674 million in 2000 and 278 million in 1980, propelled by the rise of budget air travel, social media, an emerging Chinese middle class and technologies that make distant places easy to navigate.

A wave of antitourism demonstrations took place in popular European destinations last summer, including Venice, Mallorca and San Sebastián, Spain. In Barcelona, youth groups were filmed slashing rental-bicycle tires, and officials banned tour groups from parts of the city.

Tour boats in Milford Sound on New Zealand’s remote southwest corner. The region lent its moody scenery to ‘Lord of the Rings.’PHOTOS: RACHEL PANNETT/THE WALL STREET JOURNAL

Fodor’s in 2016 began publishing a “No Go” list reflecting concerns that tourism was destroying the world’s best places. Featured this year: the Galápagos Islands and parts of Thailand, and a designation for “Places That Don’t Want You to Visit” because their governments are trying to combat overcrowding.

Economic driver

Tourism remains a crucial and welcome economic driver in many places, especially developing countries such as Cambodia and parts of Africa where visitors’ spending has lifted many out of poverty. A number of countries with well-established attractions, such as Egypt, have been hurt in some recent yearsas tourism fell off during periods of unrest.

In New Zealand, “we’re hoping for a good debate about this and no knee-jerk reaction,” says Chris Roberts, chief executive of Tourism Industry Aotearoa, an association representing hoteliers and tourist operators. “Tourists are a massive economic benefit.”

Many top tourist destinations, including U.S. national parks, have long worked to strike a balance between luring tourist money and controlling crowds.

World of TravelersThe number of people traveling globally hasmore than doubled in the past two decadesInternational arrivals, in billionsSources: World Bank; World Tourism Organization(2017)

The latest surge is different, say experts such as Simon Milne, who has researched tourism around the world, and says frustrations have been boiling at an unprecedented level, especially the past 18 months. “We can’t ignore the fact that tourists don’t have a good rap in many places,” said Mr. Milne, director of the New Zealand Tourism Research Institute at Auckland University of Technology.

Since last summer’s Europe protests, the industry has made “overtourism” a focus. More than 60 tourism ministers and private-sector leaders gathered in November to discuss the issue at a summit on the topic co-organized by the U.N. Overtourism was also a theme in March at ITB Berlin, a major industry convention.

Tourists on Maya Bay Beach, Thailand. Cleaning up a beach on Boracay island in the Philippines.PHOTOS: GETTY IMAGES

Thailand said in March it would close Maya Bay on Koh Phi Phi Leh, an island where Leonardo DiCaprio’s “The Beach” was filmed, from June to September because overtouristing was damaging the marine environment. The Philippines in April announced that Boracay, an island once known for crystal-clear waters, would close to tourists for six months over concerns about pollution.

China’s emergence as a tourist source is adding to crowds. Outbound Chinese tourists rose to more than 60 million last year from fewer than 20 million a decade earlier, according to Chinese data.

The Chinese spent $261 billion vacationing abroad in 2016, more than travelers from any other country, and China has accounted for roughly 80% of the growth in global tourism in dollar terms since 2008, according to the U.N. New Zealand’s former prime minister, Bill English, last year declared during a visit by Chinese Premier Li Keqiang that 2019 would be the “China-New Zealand Year of Tourism.”

Note: arrivals are for the fiscal year ended February 2018; expenditure for the year ending December 2017. NZ$1 billion = US$694.6 million

Source: Ministry of Business, Innovation and Employment

Yet the boom in Chinese visitors has added to traffic at some tourist hot spots, such as the white-sand tropical beaches and coral reefs of Southeast Asia, that were already under strain from throngs of visitors.

Kiwi crisis

New Zealanders once thought of tourism as a green alternative to industries such as mining or timber. Advances in aviation in the 1990s helped make the country more accessible, and government officials moved to capitalize, developing a global-tourism campaign.

In ads after the first “Lord of the Rings” film in 2001, the slogan “100% Pure New Zealand” began morphing into “100% Middle-earth.” The Department of Conservation formed a commercial-business unit to find more ways to generate income from protected areas, providing GPS coordinates of “Rings” locations.

Tourism became a top New Zealand export, along with dairy. “The landscape is so beautiful it looks fake,” says Amy Blitzer, a 34-year-old project manager from New York who took a helicopter flight to a glacier recently.

A Helicopter Landing at Milford Aerodrome

Milford Aerodrome in Fiordland National Park. Nearly 800,000 tourists visit the remote area each year.

Places such as Queenstown, gateway to numerous “Rings” sites, boomed. International visitors passing through the local airport hit 567,000 last year, from 39,000 in 2005. Property prices soared. Unemployment averaged 1.9% in 2017, versus 4.7% nationally.

“I’ve lived here for 36 years and the place is a whole lot better than when I came here,” says Jim Boult, the town’s mayor. “Some New Zealanders have the idea that because it isn’t like it was in 1965, it’s not good any more.”

Locals complain traffic has become a problem, and residents who can’t afford homes feel squeezed out. Jason Medina, an events manager, says he moved to Queenstown in 2004 and found a sleepy mountain town where houses rented for about $1,000 a month. Now, he says people are lucky to get single rooms for that.

A tourism-industry survey last fall found 40% of the country worried tourism was putting too much pressure on New Zealand, up from 18% two years earlier.

Much backlash revolves around Fiordland, a wilderness area near Queenstown. One of its 14 fiords, Milford Sound, is accessible by a narrow, winding roadincluding a one-lane tunnel. Nearly 800,000 tourists visit it each year, many on buses running such tight schedules that some drivers have only a 30-minute buffer to complete the return journey while complying with official limits that let them drive again the next day. Accidents involving overseas drivers are common.

Dozens of tour boats circled the fiord on a recent day, taking turns idling by pods of dolphins and nosing up to waterfalls.

A Milford Sound scene.

The 87-year-old Federated Mountain Clubs, one of New Zealand’s leading conservation groups, has filed dozens of complaints to the country’s conservation department over the past five years, many related to Fiordland. A petition it circulated against a proposed monorail line and new tunnel into the park received nearly 10,000 signatures. Both proposals were ultimately blocked.

Another battle was over Routeburn trail, one of New Zealand’s “Great Walks,”winding through ancient forests connecting the Fiordland and Mount Aspiring national parks. The conservation department had granted a guiding company the right to nearly double the number of guided walkers it took on the route, overriding limits set out in a recently agreed park plan. The walk was already so popular that hikers complained of congestion.

The department justified its decision under “exceptional circumstances,” a clause in conservation law. After an investigation, an independent ombudsman, whose rulings aren’t binding, called the claim of exceptional circumstances “nonsense on stilts.” The department publicly apologized to the climber who made the complaint but didn’t reverse its loosening of trail rules.

In 2016, at the urging of helicopter companies wanting to offer more flights for Lunar New Year, the conservation department granted a trial eightfold increase in aircraft landings on a remote Fiordland glacier.

The alpine club started a crowdfunding campaign to pay for the department to make its reasoning public. An ombudsman investigation in April ruled the department “acted unreasonably” and that “aspects of its decision appear to be contrary to law.”

Following Frodo’s Footprints

Hikers take to Tongariro National Park looking for landscapes from the ‘Lord of the Rings’ movies.

The Mangatepopo Road parking lot at Tongariro Alpine track.

Guides drop off hikers at Mangatepopo Road.

Heading up the Tongariro Alpine track.

Hikers take a break.

Hikers from Switzerland, Germany and France.

Soda Springs.

A hiker walks past Mount Ngauruhoe, Mount Doom in the ’Rings’ films.

Whakapapa skifield was the backdrop for some Mordor scenes.

The Mangawhero River, where Gollum catches a fish in ’The Lord of the Rings: The Two Towers.’
Guides drop off hikers at Mangatepopo Road.
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Marie Long, the conservation department’s director of planning permissions and land, says it now agrees it made a wrong decision. She says her advice to staff is to stick to existing limits in national-park management plans.

The chief pilot for Glacier Southern Lakes Helicopters, Andy Clayton, says he worries a few rogue tourism operators are spoiling things for ones that try to protect New Zealand’s green image. With helicopters, he says, “it’s all about flying neighborly.”

Some industry leaders say it is contradictory that there are New Zealanders who have turned against tourism, given its economic benefits.

“People forget that 10 years ago…the industry and New Zealand communities were screaming out for growth,” says Simon England-Hall, chief executive of Tourism New Zealand, an industry marketing agency. He says operators are aware of the changing mood and that “most of New Zealand is not yet benefiting from increased tourism.”

Last year, the government’s conservation department asked New Zealanders to nominate new areas for development to take pressure off popular hiking trails. They received around 30 responses from a population of 4.8 million, a response rate that Kevin Hackwell, chief conservation adviser for conservation group Forest & Bird, says isn’t surprising.

“Why would anyone want to volunteer their favorite local walk,” he says, “to be commercialized in the way the ‘Great Walks’ have, and overrun?”

Last September’s national election divided the nation between those who benefited from the conservative administration’s nine-year stewardship of the economy and those who felt left behind. The winning center-left Labour Party pledged to tax tourists to help fund new infrastructure.

The new conservation minister, Eugenie Sage, a conservationist who fought the Fiordland monorail, says increasing aircraft landings and expanding commercial activities on conservation land can’t go on forever.

“There is a limit,” she says. “If you’re going to a concert and the venue is sold out, you can’t go.”

Write to Rachel Pannett at