Why US-China competition is heating up in the Pacific

Competition between the United States and China is escalating in the Pacific, with both rushing to cement their influence.

They have reached out to Pacific nations, offering loans, security aid and development assistance. The stakes rose in April when the Solomon Islands signed a security accord with the Chinese government, Beijing’s first such deal in the region.

Since then, Australia and China have ramped up diplomacy. Chinese foreign minister Wang Yi made a rare eight-day trip to the region in May while Australia’s foreign minister Penny Wong visited the Pacific four times in two months.

WHAT COUNTRIES MAKE UP THE PACIFIC?

The Pacific is the world’s largest ocean and borders the US, Japan, Russia and Chile.

But the term Pacific nations usually refers to islands mostly found around or below the equator.

There are about 14 independent Pacific nations, all of which are relatively small. Only one, Papua New Guinea, has a population above one million while most are smaller than 25,900 sq km.

Larger ones include Fiji, the Solomon Islands, Vanuatu, Samoa and Kiribati. The combined gross domestic product of all Pacific independent nations is about the same as that of Vermont.

WHO ARE THEIR ALLIES?

Some Pacific countries describe their foreign policy as “friend to all, enemy to none”, but the region also has long-running ties to the US and its allies in the region, Australia and New Zealand.

Both have worked with Pacific leaders for decades and were among the seven founding members of the Pacific Islands Forum in 1971.

Over the past half century, Australia and New Zealand have provided development aid, political support and even domestic security. When violence sparked by political tensions broke out in the Solomon Islands in 2003, Australia led a regional police force to help restore order.

WHAT ABOUT ECONOMIC AID?

According to a Pacific aid map published by the Lowy Institute think tank, Australia spent more than US$10 billion in official development assistance in the Pacific region between 2009 and 2019, more than any other country.

New Zealand spent more than US$2 billion during the same time period.

However, the Lowy Institute’s figures show a new player emerging in the Pacific. Since 2009, China has become the largest lender in the Pacific, totalling more than US$7 billion.

WHY IS CHINA REACHING OUT TO THE PACIFIC?

To expand its influence in global institutions, such as the United Nations, China needs countries who will support its policy positions.

While the US often can call on the support of European, East Asian and North American countries, Beijing is building a network of developing nations to take its side in international disputes.

The Pacific also has many assets which are valuable to China’s burgeoning middle class.

According to the Chinese government, trade with the Pacific has grown to US$5.3 billion in 2021, mostly from seafood, wood and minerals.

IS THERE A TAIWAN ANGLE?

Yes. Out of 14 countries who still have official diplomatic relations with Taiwan, four are in the Pacific - Palau, Nauru, Tuvalu and the Marshall Islands.

Beijing considers Taiwan a renegade province and has worked to isolate it diplomatically in an attempt to force it to join mainland China.

In 2019, two Pacific nations switched their diplomatic recognition to China, including the Solomon Islands, in a major win for Beijing.

WHY IS THE PACIFIC SO IMPORTANT?

Australia and the US see it as vital for their security. For Australia and New Zealand, the Pacific nations are some of their closest neighbours.

In a worst case scenario, the islands could be seen as stepping stones for an invasion force - one of the most important battles of World War II was fought at Guadalcanal in the Solomon Islands, part of a campaign by the US to slow Japan’s advance.

Australia’s trade routes to Japan and South Korea run past Papua New Guinea, and any hostile military presence could leave Australia’s exports vulnerable.

For the US, the Pacific is part of its “island chain” security concept, which sees islands as part of defence lines between Asia and the US. Guam and Hawaii could also be vulnerable.

WHAT HAPPENED IN THE SOLOMON ISLANDS?

The government had been moving closer to Beijing, including officially switching its diplomatic recognition to China.

But when a draft security agreement between China and the Solomon Islands was leaked in March 2022, it shocked Australia and the US, neither of whom appeared to have been aware how far along a deal was.

Most worrying for Canberra, if the draft deal went ahead the Chinese navy would gain a safe harbour just 2,000km from the Australian coast.

The US, Australia and New Zealand all voiced concern but could not stop the deal.

In April, during the 2022 Australian election campaign, China said the agreement had been signed. No final wording has been released, leaving details unclear.

HOW HAVE THE US AND AUSTRALIA RESPONDED?

It led to a flurry of diplomacy, as Australia and the US attempted to rebuild ties in the Pacific and avoid more accords being struck.

Since taking office in May, Australian Prime Minister Anthony Albanese and his government have worked to expand the country’s influence.

In addition to Wong’s visits, the government pledged to reduce carbon emissions faster, a priority for vulnerable island nations.

The US has announced new embassies in a number of nations, including the Solomon Islands.

At the annual Pacific Islands Forum in July, US Vice President Kamala Harris unveiled plans to increase funding to the Pacific by US$60 million every year.

Albanese and Wong attended the event, while no Chinese leaders addressed the forum.

WHAT DO PACIFIC LEADERS THINK?

They do not like being treated as diplomatic footballs.

When Solomon Islands Prime Minister Manasseh Sogavare faced criticism over his deal with the Chinese government in May, he said the country was being treated like children with guns.

Australia often refers to the Pacific as its backyard, but regional leaders have bridled at the term.

“Fiji is not anyone’s backyard - we are a part of a Pacific family,” Fiji Prime Minister Frank Bainimarama said in a tweet in May.

WHAT HAPPENS NEXT?

In May, China tried to strike a trade and security agreement with 10 Pacific nations but was rebuffed after they complained they were not given enough time to consider it.

There are signs China will try again, with foreign ministry spokesman Zhao Lijian saying the process was “ongoing”.

In August, the US and Japan said they had conducted joint military drills with the Solomon Islands’ coast guard for the first time.

Both Sogavare and China’s ambassador to Australia Xiao Qian denied there is any appetite for a military base in the Solomon Islands.

However, an Australian Broadcasting Corporation report in August alleged Chinese state-owned enterprises had been expressing interest in an old airstrip and deep-water harbour in the Solomons.