China’s Pacific tour raises hopes and fears in tiny island nations | Business and Economics News

At a carefully choreographed press conference in the Solomon Islands capital, Honiara, Chinese Foreign Minister Wang Yi made a pledge that will be bookmarked by diplomats and analysts in capitals around the world. Beijing, he said, had “no intention” of building a military base in the Pacific nation.

A month after China and the Solomon Islands signed a security agreement, raising concerns in the United States and its allies, Wang embarked on Thursday on a 10-day tour of eight Pacific countries that also includes Samoa, Fiji , Vanuatu, Kiribati, Tonga, Papua New Guinea and East Timor. His visit is the latest chapter in an escalating geopolitical race to woo the nations of the region. Anthony Blinken, US Secretary of State, visited Fiji in February and Australia’s new foreign minister, Penny Wong, landed in Suva on Thursday.

But even as Wang dismissed suggestions of a military installation in the Solomon Islands, a shroud of secrecy and opacity over specific Chinese plans – reinforced by restrictions on press covering his visit to Honiara – led to a series of unanswered questions in the region.

Does the security pact with the Solomon Islands allow Beijing to send warships to Honiara, as a leaked draft suggests? Is China pressuring other Pacific island nations to sign a regional version of this agreement, as another leaked memo states? Will a draft Solomon Islands ‘blue economy’ development deal allow China to exploit undersea minerals, as a leaked third document hints? On Thursday, the Honiara government said China and the Solomon Islands were to “sign a number of cooperation agreements” during Wang’s visit.

On Friday, the Solomon Islands government confirmed that the parties had signed a number of agreements related to visa waiver for diplomats and civil servants, civil aviation, disaster risk reduction and cooperation in health. The texts of the agreements have not been made public.

“There is a lot of suspicion and mistrust between the people and the government about what China plans to do in terms of development,” said Michael Salini, a businessman and commentator based in Tulagi, Solomon Islands, at Al Jazeera. “Nobody really knows what’s on offer from the Chinese side.”

Chinese Foreign Minister Wang Yi visits eight Pacific countries, including Solomon Islands [Naohiko Hatta/Pool via Reuters]

Some things are clear, however. Since 2009, China has been the region’s second-largest lender, committing a total of $169 million, including grants.

Unlike the United States and its allies like Australia, or international bodies like the World Bank and the Asian Development Bank (ADB), Beijing does not generally tie its aid to economic and governance reforms.

“It allows China to say its loans and grants are unconditional – even though there are still political considerations at play,” said Peter Kenilorea Jr, an opposition MP in Solomon Islands.

“This makes China an attractive economic partner for our resource-strapped countries.”

Also on this trip, governments of Pacific island countries are expected to seek China’s support in everything from infrastructure projects to post-pandemic recovery of their fragile economies.

Willie Jimmy, Vanuatu’s former finance minister and ambassador to China, said he welcomed Wang’s visit, although he was previously unaware of the trip due to a lack of publicity in media or government announcements.

“I welcome any other projects that anyone wishes to announce to help the government and people of Vanuatu, as other donors do not take any project that is inconsistent with their foreign policy assistance. [objectives]. China gets them back,” Jimmy told Al Jazeera, adding that building roads and developing other infrastructure in the archipelago, which includes 65 inhabited islands, is difficult due to its dispersed island terrain and its politics. localized.

“It is very well received by people. I support China’s initiative to develop infrastructure in the Pacific Islands.

Jimmy dismissed fears of so-called debt trap diplomacy, saying that as finance chief he persuaded China to cancel Vanuatu’s 1 billion vatu ($8.6 million) debt after the government was unable to repay two 20-seat Harbin Y-12s. plane.

“The AfDB, IMF, World Bank or any other donor cannot do this,” he said. “That’s why I don’t believe in this debt trap.”

Flag of the Solomon Islands in Beijing
China and the Solomon Islands have signed a security pact that has raised alarm bells in the US, Australia and New Zealand [File: Reuters]

Many countries in the region are deeply indebted to China.

Vanuatu’s debt to China is nearly a quarter of its gross domestic product (GDP), according to AidData, a US research group that tracks how much different governments owe each other.

“Major debt cancellation is a hot topic to ease the tax burden,” Glen Craig, managing partner of Vanuatu-based Pacific Advisory and chairman of the Vanuatu Business Resilience Council, told Al Jazeera.

Wang’s visit did not been publicized in Vanuatu, he said.

“Generally, I think it will be seen as a sign of the nation’s importance.”

Across the region, recovery from COVID-19 is also a priority, said Sandra Tarte, director of the Politics and International Affairs program at the University of the South Pacific in Fiji.

“The Chinese foreign minister can be asked what China can do to help and support countries this time – bearing in mind that China itself is still experiencing major Covid-induced disruptions,” Tarte said. at Al Jazeera.

But there is growing skepticism in the region at China’s insistence that its intentions are benign. A Chinese-backed plan to develop a WWII-era airstrip in Kiribati has raised concerns that Beijing may be planning a base there – although the island nation’s government has denied that there is such a proposal. Last week, the Financial Times reported that China was in talks with the governments of Kiribati and Vanuatu for security pacts.

Brian Orme, a former opposition spokesman in Kiribati, said current President Taneti Maamau enjoys broad public support and would be politically able to push through a security deal with China if he wanted to. . Orme said he believed China intended to potentially establish two bases in Kiribati — a move the United States would almost certainly view as a provocation.

“China wants our waters, our deep sea minerals and wants these islands to be close to the United States,” Orme told Al Jazeera.

“Whatever China wants, China will get this Friday,” he added, referring to Wang’s visit to the country today.

“There is no real opposition party. A bit of noise, but there is no real opposition party at all.

Boy looking at the sea in Kiribati
Climate change is a major concern for Pacific island countries like Kiribati [File: David Gray /Reuters]

China’s security presence is not the only thing worrying some in the region. Kenilorea Jr, the Solomon Islands opposition lawmaker, has expressed concern over a memorandum of understanding with Beijing aimed at allowing China access to his country’s waters.

“Of course developing the Solomon Islands blue economy would bring in revenue, but I am concerned about the depletion of our mineral and fisheries resources,” he told Al Jazeera.

The United States and its allies are not standing idly by. In addition to visits to the Blinken and now Wong region, the leaders of the United States and Australia also met with their counterparts from India and Japan for a Quad grouping session in Tokyo earlier this week. “It’s not lost on me that Wang visits when he does,” Kenilorea Jr. said.

This geopolitical competition between the United States and its allies on the one hand and China on the other could in theory help Pacific island nations strike the best deals. But in reality, Tarte said, the region needs Washington and Beijing to work together on its most pressing concern: climate change.

“In that sense, geopolitical rivalry and competition serves no one’s interests,” she said.