China’s Reach Tests the Pacific’s Fragile Island Democracies

A decade ago, then-U.S. President Barack Obama billed himself as the “first Pacific president” and announced, several years later, a foreign-policy “pivot to Asia.” But the pivot proved largely illusory, and the region only grows more complex. The growing challenges faced by Pacific island countries requires significant reassessment as the region becomes one of the tensest political battlegrounds in the world.

A growing battle of diplomatic and economic statecraft is playing out on remote islands. China is acutely aware that the fledgling democracies of the Pacific are prone to shortsightedness—and in some cases outright corruption—and, as a result, are at risk of manipulation that goes against their best interests. That lays the groundwork for Chinese expansionism, initially economically, with the long-term goal of a military presence to rival that of the United States. The Solomon Islands derecognizing Taiwan is only the latest victory for Beijing.

China’s ambition to become the regional leader in the Pacific is pursued through the use of both diplomatic and economic statecraft, with the longer-term goal of military expansionism in the Pacific. Within hours of his appointment as U.S. ambassador to Australia, Arthur Culvahouse described China’s spending in the Pacific as akin to “payday loan diplomacy.” Otherwise reported as “debt-trap diplomacy,” this strategy sees vulnerable countries targeted with unsustainable debts with the intention of generating political leverage. Calculating Chinese contributions in the Pacific is difficult, as China does not engage with the similar transparency and accountability mechanisms followed by other major donors.

China’s diplomatic statecraft has taken leaps and bounds over the past decade. Beijing has become increasingly adept at working within and massaging international institutions to support and legitimize its actions. Reports from this past year’s United Nations General Assembly meeting in New York point to an increasingly brazen China willing to tackle critiques and threats head-on. A recent example is its swiftness in addressing criticism of the oppression of ethnic Uighurs and other Turkic minorities in Xinjiang. At the U.N., a nonbinding statement praising China’s record on human rights was supported by 54 countries including Egypt, Pakistan, and Russia—evidence of China’s growing diplomatic and economic clout.

Exploiting the vacuum created by a withdrawal of U.S. influence in international institutions, China has also been positioning its diplomats within U.N. agencies, slowly shaping institutions to reflect its interests. This May, China’s nominated candidate stands a chance to head the U.N.’s World Intellectual Property Organization, much to the alarm of the West, whose companies are frequently falling victim to Chinese IP theft.

China’s growing skill at statecraft extends to Pacific affairs. Recently, China exploited a rift between Australia and Fiji on climate change policy after the Pacific Islands Forum in Tuvalu in August 2019. China’s foreign ministry spokesman Geng Shuang referred to Australia’s behavior as akin to a “condescending master” and “insulting” to climate-vulnerable nations. Geng went on to accuse Australia of spreading “the China threat fallacy among island countries” and claimed—falsely—that Chinese engagement comes “with no political strings attached.” The comments were widely reported in Australia and across the Pacific, allowing China to point toward tangible tensions and in turn damage the Australian government’s stature as the primary ally of the Pacific island countries.

China’s use of development aid in the Pacific, particularly through the Belt and Road Initiative, has been raising concerns. Analysts, including from the Lowy Institute, have spoken out on the scale of Chinese lending and the capability of Pacific nations to effectively scrutinize the financial sustainability of the debt they’re assuming through partnering with China on infrastructure projects. A commonly cited example is the construction of a national conference center in Vanuatu. Completed and handed over by China in 2016, it is now a monument to poor lending and construction processes. Prime Minister Charlot Salwai of Vanuatu said in early 2019 that the government is no longer able to maintain the building, which is incurring significant costs due to the absence of actual conferences. The aforementioned Lowy Institute report states that several island countries in the Pacific, particularly Tonga, Samoa, and Vanuatu, are already significantly indebted to China.

The growing influence and presence of China in the Pacific have laid the foundations for China to lean on the island countries to meet its longer-term ambition of establishing a military base in the region. Such a base would likely be constructed out of a continued expansion of newly built or preexisting facilities that can serve multiple purposes. The Chinese-built wharf on Espiritu Santo island in Vanuatu is one such example—built for commercial cruise ships, the wharf also has the capacity to service naval vessels. It was built in close proximity to Vanuatu’s international airport, which China is assisting in upgrading.

China views a base in the Pacific as an imperative if it is to establish a greater regional presence outside of the highly contested South China Sea. It would be the second such base for the Peoples Liberation Army after the establishment of the Djibouti base in 2017. While Vanuatu is frequently identified as the most likely candidate where China could establish a permanent military presence, other Pacific states such as Tonga have also been mentioned.

Though Australia is the largest provider of development assistance in the Pacific, a nation of 25 million people is unable to tackle Chinese foreign influence alone. Key to Prime Minister Scott Morrison’s government’s “Pacific step-up” strategy are the deep personal, historical, and cultural ties formed between Australia and Pacific island nations over the last 50-plus years. Australia is using its sizable diplomatic presence, providing targeted aid, delivering infrastructure projects, assisting in governance, and tackling corruption.

In December 2019, Australia announced that its aid budget will be subject to a landmark review to reprioritize and redirect Australian aid. The review will identify “new and emerging priorities,” which will likely see further prioritization of the Pacific. The Morrison government last year also announced the Australian Infrastructure Financing Facility for the Pacific. The initiative, with 2 billion Australian dollars (about $1.4 billion) in funding, will use grants combined with loans to support the development of high priority infrastructure.

Australia has a long history of assisting in the development of significant infrastructure projects—most recently, the construction of the 3,000-mile-long Coral Sea Cable System between Papua New Guinea, the Solomon Islands, and Australia. The project aims to deliver faster, cheaper, and more reliable communications infrastructure. Upon completion, Papua New Guinea and the Solomon Islands will be the majority owners and beneficiaries of revenue raised. Media reporting had linked Australia’s support of the project with ensuring that the high-profile Chinese telecommunications company Huawei did not undertake the project.

The Australia-China bilateral relationship has been consistently strained over the past five years. China has been accused of attempts to influence Australian policy by a range of covert means. One such case in 2016 saw Labor Party Sen. Sam Dastyari engulfed in a scandal involving Chinese donors that resulted in his resignation. Among other transgressions, Dastyari had conducted a media conference calling on Australia to shift away from its strong rejection of China’s territorial claims in the South China Sea. Tensions were further exacerbated by a major cyberattack on Australia’s Bureau of Meteorology that was widely linked to China. Recently, China has denied visas for two Australian politicians who had spoken out against China’s treatment of the Muslim Uighur population. One Australian commentator argues the high-water mark came with the signing of the China-Australia Free Trade Agreement in 2015—now, the relationship has permanently changed.

Australia is acutely aware that supporting the fragile democracies of the Pacific requires greater cooperation with likeminded nations, and allies are listening and engaging. The United Kingdom announced in 2018 the expansion of its diplomatic presence in the Pacific—establishing new posts in Samoa, Tonga, and Vanuatu. The growth in representation allows for a deepening of relations in the region by a fellow Five Eyes intelligence partner. The U.K. is also highly regarded for the size and reach of its aid projects through its Department for International Development.

The United States’ engagement in the Pacific is often viewed through the lens of United States Indo-Pacific Command. A report by the Sydney-based United States Studies Centre recently warned that the U.S. defense strategy is in “the throes of an unprecedented crisis,” which is born out of a misalignment between ambition and the reality of available defense resources. The report argues for a need to develop a shared reliance on a network of allies in the region, noting Asian militaries such as Japan’s can offer significant strategic benefits.

Yet cooperation with the United States in some respects has been deepening in recent years. In late 2018, U.S. Vice President Mike Pence announced that Australia and the United States had commenced a naval base upgrade on Manus Island in northern Papua New Guinea. The upgrades did not go unnoticed in Beijing, and China sent deep-water surveying vessels to the region. Media reporting in Australia also shed light on the rumored construction of a new deep-water port facility outside of the northern Australian city of Darwin. Such a facility could be an access point for U.S. Marines who have been routinely stationed in Darwin since 2012.

Developing a shared reliance on a network of military allies in the region would aid the Pacific—but this should be extended further. The Pacific needs greater harmonization in rhetoric as well as cooperation in the delivery of both aid and infrastructure projects. Likeminded states must work together to counter influence in the region that often fails to work in the best interest of the Pacific island countries. It is unlikely that tensions will subside in the short to medium term—rather they will continue to test the fragile democracies of the Pacific.