The Pacific Islands are a crucial part of Australia’s region. Picture: Google Earth
The Pacific Islands are a crucial part of Australia’s region. Picture: Google Earth

Bold new move to stifle China

THERE is a quiet but critical struggle for international influence happening right on Australia's doorstep.

Its focus is the Pacific Islands, a group of small countries which have drawn the interest of a superpower.

China has showered nations such as Vanuatu, Tonga and the Solomon Islands with cash in recent years. Between 2006 and 2016, it invested $2.3 billion in the region, according to an analysis from the Lowy Institute.

Some Australian experts are worried. Their fear is that China's intentions are not entirely pure.

"Such indebtedness gives China significant leverage over Pacific Island countries and may see China place pressure on Pacific nations to convert loans into equity in infrastructure," the Lowy Institute has warned.

"It's not win-win for China and the recipient, but simply win for China, which not only gets access to local resources and new markets, and forward presence, but can coerce the recipient state to pay a 'tribute' to Beijing by ceding local assets when it can't pay back its debts."

That is the backdrop for Labor leader Bill Shorten's speech to the Institute today.

Mr Shorten will promise to put the Pacific "front and centre" in Australia's foreign policy, should Labor win government.

 

"Our neighbours in the Pacific are looking for partners to help them build infrastructure - and as Prime Minister, I intend to make sure they look to Australia first," he will say.

"I see this as a way Australia can elevate our status as a 'partner-of-choice' for Pacific development and enhance security and prosperity in the region."

There is no explicit mention of China there, and Mr Shorten will stress his aim is not to stymie the country's influence.

"Our goal will not be the strategic denial of others but rather the economic betterment of the 10 million people of the Pacific Islands."

But you can't ignore the context of his words.

China's investment in the Pacific has been a flashpoint of tension with Australia for some time now.

Earlier this month, Liberal senator Concetta Fierravanti-Wells copped a diplomatic serve after issuing a grim warning in The Australiannewspaper.

She claimed China was tempting poor countries with loans they couldn't afford to repay - a strategy far less sinister than military expansion, but no less effective.

"Today, the sovereign threat is less confrontational but the debt-trap diplomacy just as insidious," Ms Fierravanti-Wells wrote.

"Pacific countries need to use limited government reserves to meet their loan commitments to avoid defaulting. Domestic spending and important social programs are jeopardised.

"Consequently, the internal stability of these countries may be affected and greater demand is placed on overseas development assistance from countries such as Australia.

"In short, Australian taxpayers effectively will be subsidising repayment of loans to China."

Ms Fierravanti-Wells had previously accused China of funding "useless buildings" and "roads to nowhere" in the island nations.

Senator Concetta Fierravanti-Wells got a scathing response from China. Picture: AAP Image/Mick Tsikas
Senator Concetta Fierravanti-Wells got a scathing response from China. Picture: AAP Image/Mick Tsikas

The Chinese Embassy met her warning with a scathing response.

"The ridiculous and absurd allegation, filled with Cold War mentality, reflected the senator's prejudice, arrogance and ignorance," it said.

China insisted it wanted to help the Pacific nations "with no political strings attached" and said any attempt to obstruct it would be "doomed to failure".

"One can never win respect by smearing others. Whether China's assistance is productive or not, and whether it is a pie or a pitfall, the people of the Island Countries have the best say," it said.

It wasn't the first time tensions had boiled over. Earlier this year, China's state-run media went so far as to brand Australia an "arrogant overlord" in another spat over the Pacific.

Mr Shorten prefers to frame Labor's proposal as pro-Pacific, rather than anti-China.

Today he will promise to appoint a Minister for Pacific Affairs and International Development should Labor win the next election. The role is currently held by an Assistant Minister, Anne Ruston.

Mr Shorten will spruik the change as "proof of how seriously we take the Pacific and the people who call it home".

"Obviously, development assistance is critical, and Labor will grow our aid commitment to the Pacific. But our agenda of engagement needs to be bigger and broader than this," Mr Shorten will say.

That broader agenda would include the creation of a government-backed infrastructure investment bank, and the encouragement of private firms to invest in the Pacific.

"A Labor government I lead will seek to engage with the Pacific through partnership, not paternalism. Ours will be a listening leadership, based on respect and a genuine understanding of each other."

Environment Minister Melissa Price. Picture: Kym Smith
Environment Minister Melissa Price. Picture: Kym Smith

The speech will also include a thinly veiled swipe at Environment Minister Melissa Price, whose awkward encounter with former Kiribati president Anote Tong at a Canberra restaurant created a stir two weeks ago.

"I know why you're here. It is for the cash," Ms Price allegedly "remarked loudly" to Mr Tong.

"For the Pacific it's always about the cash. I have my chequebook there. How much do you want?"

A Labor senator who was dining with Mr Tong, Pat Dodson, said other people at the table were "shocked and embarrassed".

Ms Price later said she was sorry if she had caused any offence.

"It is not for us to lecture these nations about what they should want - or insult and patronise our neighbours if they ask for assistance - but rather work alongside them to achieve the progress they need," Mr Shorten will say.

Former Kiribati president Anote Tong. Picture: AAP Image/Lukas Coch
Former Kiribati president Anote Tong. Picture: AAP Image/Lukas Coch
 


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