Post Series: Should Indigenous economies take the LEAP? (3)

WIBF photo
Conference Dinner, World Indigenous Business Forum 2018, Rotorua

In the previous two posts, I laid out the context and set the theoretical framework to answer a question: whether indigenous economies should take the LEAP.

This final part outlines ways to conceive of practicing mana motuhake within the existing legal system by carving out special jurisdictions that enable Indigenous Peoples to enter trading relationships and pursue their economic aspirations on their own terms.

These posts serve only as introductions to ideas about practical approaches to realising Indigenous self-determination.

The link to theory

With increased cooperation in the Asia Pacific region, Indigenous Peoples have become visible to each other again in economic and trade contexts. Events like the World Indigenous Business Forum or the World Indigenous Tourism Summit indicate that tribal leaders and indigenous entrepreneurs are looking for ways to leverage those opportunities and reinvigorate the entrepreneurial spirit and pragmatism of their ancestors for future generations. Countries around the world are exploring and evolving policies as an innovative approach to accelerate economic development in areas of high deprivation or underdevelopment – unfortunately a space that Indigenous Peoples know too well as a direct result of the violence of colonisation. There have been mixed successes and many lessons, one of the more well known examples being Shenzhen, China.

The essence of these posts is to suggest that there is an opportunity for New Zealand to support Māori to introduce everyday acts of resurgence into the international trade context to open up new spaces for cultural resurgence which could create and set new trade and economic expectations driven by Indigenous Peoples and their relationships to planet, place and people.

Exploring development models

In exploring development models, international models provide a useful and persuasive starting point. Intensive research from the Harvard Project on American Indian Economic Development (Harvard Project) founded by Professors Stephen Cornell and Joseph P. Kalt confirms that Indigenous Peoples achieve better outcomes when enabled to make decisions about their own economic development (Harvard Project, n.d.). In its 20 years of operation, the Harvard Project has established four key themes that matter to the success of indigenous development models: sovereignty, institutions, culture and leadership (Harvard Project, n.d.). Comparably, Special Economic Zones (SEZs) which by general definition refer to geographic locations within a national territory where the normal domestic rules do not all apply (Bell, 2016, pp.959-960) offer various exemptions and incentives to conduct business through free trade, foreign trade, export processing, and enterprise zones depending on the specific needs of the community (Crampton & Acharya, 2015, p.6).

SEZs and LEAPs as regional development policy initiatives provide alternatives for policy makers to “experiment with different regulations without threatening established national power structures” and to “trial and promote reforms that other regions could replicate or borrow from to meet the needs their particular constituency” ensuring that governments are responsive and relevant to their communities (Crampton & Acharya, 2010, p.6). Adopting this regional lens has benefits because New Zealand’s economic policy agencies already work in regionally defined programmes and this focus can assist in prioritising a range of development zone areas. These strategic and political levers matter because at a practical level policy solutions require political will.

SEZs are often adopted to encourage investment and stimulate growth in underdeveloped areas (Bell, 2010; Crampton & Acharya, 2015). However, some of the challenges SEZs confront include mixed success resulting from low institutional quality, poor local infrastructure, or corruption (Crampton & Acharya, 2015, p.6). The more radical LEAP zones (LEAPs) “special legal, economic, administrative, and political jurisdictions” are smaller in size than SEZs but draw people to them voluntarily as opposed to imposing them on existing communities (Klugmann, 2013). LEAPs share similar themes to the Harvard Project findings including their inherently regional focus, freedom to regulate according to the needs of the community, and an emphasis on leadership and credible institutions (Bell, 2016; Wong & Buba, 2017; Crampton & Acharya, 2015). Whereas SEZs focus on market liberalisation and financial incentives to do business in the designated zones (Crampton & Acharya, 2015; Bell, 2016; Wong & Buba, 2017), LEAPs offer more flexibility to advance the broader set of Māori aspirations. However, improving the usefulness of these models for the Māori context will require some deviation from the standard SEZ or LEAP definition: shifting the driver from economic growth to collective capability for self-determination.

Murphy (2014) describes the collective capability for self-determination as “members of a distinct political community” cooperating to implement a shared vision and build the physical, cultural, legal and political infrastructure to “shape their individual and collective futures” (pp.323-324). He also considers “capability for collective self-determination partly constitutive of the freedom and well-being of communities and their individual members” (Murphy, 2014, p.326). In linking Murphy’s approach to both Corntassel and Puig, collective capability could be produced through a combination of indigenous self-determination principles and approaches that policy makers could apply to development models such as LEAPs to accelerate indigenous economic development underpinned by a both responsibility to the natural world (Corntassel, 2012) and achieving community oranga (wellbeing) (Murphy, 2014). Re-framing in this way, centres communities and their wellbeing in trade discussions as opposed to market liberalisation which is often met with fierce opposition by indigenous communities due to the negative impacts globalisation inflicts on Indigenous Peoples and the protection of their natural resources (Puig, 2019). It also aligns with the Harvard Project findings that:

“When Native nations make their own decisions about what development approaches to take, they consistently outperform external decision makers on matters as diverse as governmental form, natural resource management, economic development, health care and social service provision” (Harvard Project)

There is a risk that devolving or ascribing LEAP functions for a geographical area outside of government controls could create domestic tensions as some of the public may express concerns about political stability if alternative legal or rules structures operate within the nation structure. However, this already happens to an extent with Local Government and as discussed throughout previously, marae already demonstrate how tikanga and kawa can operate inside a national legal structure without the threat of instability. As human beings, we have shown that we can operate according to a range of rules within a meta structure without things falling apart. LEAPs are not about implementing lawless regions, they are about enabling particular rules to be decided according to the needs of the particular community independent of the national body of rules.

Framing matters. Articulating the value proposition of LEAPs as exploring new ways to give effect to indigenous self-determination in a way that complements the national legal narrative will be imperative. Explaining the models innovation potential that combines the very best models available as the starting point, not the aspiration could shift opponents from a fear of instability to an optimism of possibility (Klugmann, 2013). For instance, rather than settling trade or investment disputes in courtrooms or through arbitration tribunals, they could be settled in the marae – kanohi ki te kanohi – direct between the parties, thereby reshaping and humanising commercial matters that in contemporary times have become highly impersonal transactions.

Imagining a Māori SEZ or LEAP in New Zealand 

In terms of modelling, Bell (2016) notes that “[z]ones have in recent years begun shifting away from encouraging international trade with relatively simple financial incentives-exemptions from customs obligations, toward ‘multiuse developments’” comprising industries, commercial, retail, residential and tourism (p.974). The multiuse proposition could be particularly useful for developing remote or rural areas, or those smaller towns with high levels of poverty due to low employment – in both urban and rural settings. While not enjoying the special economic status of an SEZ or LEAP, Ruakura, the inland port and logistics hub owned by Tainui Group Holdings (TGH) reflects a multiuse type arrangement with the associated benefits (Ruakura, n.d.) and provides a potentially useful starting point to imagining an SEZ or LEAP in New Zealand in an indigenous commercial context.

Ruakura is located within the Golden Triangle[1] with rail and road connections to both Tāmaki Makaurau (Auckland) and Tauranga ports (Ruakura, n.d.). When fully operational, it will offer a logistics and freight hub, residential areas, innovation centres and retail, providing jobs and homes for more than 10,000 employees and around 4,500 residents at Ruakura (Ruakura, n.d.). Given the stage of development for Ruakura, there is an opportunity for TGH and the government to explore these kinds of innovative approaches to accelerate the operationalisation of the hub. Comparing indigenous initiatives with different zone statuses and at varying levels of zone potential could enable TGH and the government to gain deeper insight into the innovation potential for indigenous economies, and their future trade and international relationships.

Iron Horse Industrial Park a Foreign Trade Zone in the U.S. owned by the Citizen Potawatomi Nation (Iron Horse, n.d.), offers a useful comparative case for TGH and the government to consider how it could support Waikato Tainui to exercise its mana motuhake (self-determination) through acquiring LEAP status for its development (if it desired that status).  Iron Horse received Foreign Trade Zone status in 2014 to enable more liberalised international business transactions and to provide benefits such as tax incentives and duty exemptions, reductions and deferrals for businesses and investors seeking to enter the U.S. market (Iron Horse, n.d.). Like Ruakura, it is strategically located, and is considered a magnet site of the Port of Greater Oklahoma City’s FTZ (Iron Horse, n.d.). If TGH could attract the investment it needs to supercharge its Ruakura industrial development, the benefits of that investment – building the collective capability for self-determination of its people – could potentially accrue to its tribal members much sooner than its current timeframe of 2041.

Given the shape of our societies, the importance of both advancing iwi developments and exploring similar opportunities for urbanised Māori, is critical for policy makers to also explore to unlock the full potential of the diverse economies within Te Ao Māori.  Two examples for conceptualising innovative approaches for advancing urban indigenous economies is the city of Toronto’s Indigenous Centre for Innovation and Entrepreneurship (ICIE) that is currently under development (City of Toronto, n.d.) and He Waka Eke Noa, a social procurement intermediary based in Manukau, Auckland.

Note: conceptualising LEAPs in urban environments creates a range of challenges – including challenges around tribal interests in land where it might be proposed that a LEAP is established. One way around this significant challenge could include corrective contemporary Te Tiriti settlements but this is a topic of its own and would require careful, inclusive and transparent consideration.

Indigenous Centre for Innovation and Entrepreneurship (ICIE)

When complete, the ICIE will offer a range of economic supports to Indigenous Peoples such as business incubators and accelerator programmes for entrepreneurs to scale up their businesses (City of Toronto, n.d.). It will also provide a commercial space for indigenous economic connections that will operate as a hub in what is to become an indigenous business district in downtown Toronto (City of Toronto, n.d.). The notion of an indigenous business district enables the City of Toronto to expand its vision and to outsource its development to the Indigenous Peoples it will serve. These kinds of initiatives support notions of resurgence as expressed by Corntassel (2012), and provide the infrastructure to build collective capability as imagined by Murphy (2010) and the rules and procedures of how any international trade could be managed from within zone (Puig, 2019), but all of those components require the open minds of decision makers and the institutional support to back them.

He Waka Eke Noa

New Zealand could look to the ICIE model to explore the potential to evolve He Waka Eke Noa from a virtual hub to a physical hub similar to the ICIE with the broader aspiration of establishing an indigenous business district with LEAP status in Manukau.

He Waka Eke Noa currently operates as an intermediary function that “connects Māori and Pasifika-owned businesses with clients and buyers wanting to purchase goods, services and works” (He Waka Eke Noa, n.d.). This initiative is the result of a collaboration between local and central government agencies in Tāmaki Makaurau (Auckland) indicating that the model – as an innovation – enjoys a sufficient level of institutional support to improve its chances of success. The value proposition of a He Waka Eke Noa as the centre of an indigenous business district, is its current location in South Auckland – an area with one of the highest concentrations of Māori in the rohe and therefore the ability for Māori in the area to benefit directly from local jobs and local spend in the community.  In addition, its upgraded public transport infrastructure and proximity to the Auckland International Airport also presents global opportunities at its doorstep, with ease of access to a major trade and logistics hub and the ability to attract local spend from increasing traveller flows to the region to help sustain jobs and enterprise in the area.

Other levers and their linkages to LEAPs

When thinking about LEAPs in the indigenous context, ‘reservations’ also come to mind. While marae reservations in New Zealand are not an ideal comparative to North American reservations, understanding the Canadian and U.S. reservation models provides a way of understanding how to better utilise the marae reservation status. North American reservations arise from negotiated settlements with their settler governments, where a “portion of their traditional territory is reserved for permanent use by the tribe” (Sierra Project, 2015, p.3). Along with the reservation of land, the Tribe is accorded a degree of sovereignty to enact laws and govern people within its territories (Sierra Project, 2015, p.3). This limited sovereignty effectively prevents States from regulating the commercial activities of Native Americans on their reservations (Sierra Project, 2015, p.3). Arguably, reservations reflect LEAPs based on the domains that tribes do have control over. However, the prohibition from entering into “treaties with foreign governments the way a traditional nation would be able to” (Sierra Project, 2015, p.3) limits the use of international trade as a tool for self-determination. LEAP status could assist in overcoming that by providing more levers than a standard FTZ that some tribes have opted for, in their tribal economic development.

In New Zealand, while marae reservations can be set aside for a range of purposes to prevent the land being compulsorily acquired under the Public Works Act 1981,[2] the key point about marae is that it could be possible for them to operate as LEAP connecting points to build a networked reservation that establishes the cultural infrastructure and backbone support for the creation of indigenous LEAPs throughout New Zealand. LEAP status could enhance the function of marae to give them greater alignment to North American reservations by imputing a relational sovereignty for networked members enabling the regeneration of Māori cultural and economic assets. Strengthening cultural identity and enterprise together could as Murphy’s (2014) approach suggests, enhance both the physical and psychological wellbeing of Māori, by addressing social and economic triggers to stress and cultural connectivity. Anecdotally, when people see themselves reflected in their communities as valued members they feel more connected to who they are and where they belong. In addition, implementing LEAPs could help grow the number and range of enterprise and employment opportunities – including roles in the tradable (export) sector, to lift Māori incomes so Māori are accessing a greater proportion of the nation’s prosperity.

A fundamental challenge to achieving special economic status is the racism that persists in New Zealand, including in its institutions.  Any special status sought or granted to its Indigenous Peoples will likely be met with rigorous resistance diminishing the will of politicians to take bold stances to advance the innovation potential of Māori economies and their cultural centres – marae. Often, opponents liken Māori cultural identity to religion and their marae to Churches or Mosques, whom, they will argue should also have access to those same special statuses. However, there is nothing in the idea of LEAPs to preclude those institutions from seeking similar special economic statuses. Additionally, critics of this school of thought should be careful not to conflate Māori identity with religion, and marae with churches, as doing so erases an entire peoples history which comes dangerously close to proposing cultural genocide.

New Zealand has an opportunity to partner with its indigenous communities to identify urban and rural areas that could benefit from special economic status and better understand the kinds of trade policy measures that will accelerate Māori economic development and give effect to the right of its Indigenous Peoples to self-determination to lift the wellbeing outcomes of Māori. The theories offered by Corntassel, Puig, and Murphy provide a basis for developing a uniquely indigenous development model without prescribing its rules, processes or conditions. Moreover, the tripartite of views provides the foundation to access legal frameworks that enable the establishment of zones where cultural resurgence can prosper and produce collective capability. Therefore, LEAPs offer an alternative approach that could support Māori (and other Indigenous Peoples) to continue the innovation legacy their ancestors began more than 6000 years ago when leaving Taiwan.  Should indigenous economies take the LEAP? Simply put, yes.

[1]              The Golden Triangle is ‘the term economic commentators use to describe the geographic area bound up by Auckland, Hamilton and Tauranga’ (New Zealand Herald, 2018).

[2]           Section 338, Te Ture Whenua Māori Act 1993

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