Fiji island

China’s Pacific ambitions have been checked, for now

The second China-Pacific islands foreign ministers’ virtual meeting was held on May 30th, co-hosted in Fiji by that country’s prime minister and foreign minister, Frank Bainimarama, and China’s foreign minister, Wang Yi. The summit did not approve a region-wide trade and security agreement proposed by China, suggesting that Pacific islands are reluctant to align more tightly with China. 

Why does it matter?

The signing of the agreement, known as the Common Development Vision, would have linked Pacific island nations more closely with China as a development and security partner. The failure to secure a consensus behind it preserves the geopolitical status quo in the region—for now—and provides an opportunity for Australia, the US and other Western-aligned powers to step up regional diplomacy.

Geopolitical competition gives Pacific island governments the chance to secure development benefits and policy support on issues such as climate change, but it will also probably create a difficult balancing act. 

The failure to gain backing for the agreement represents a check on China’s ambitions in the region. Internally, there will likely be questions about the wisdom of pursuing such a sprawling agreement, achieving consensus on which would probably be difficult. Besides development issues, where China is an established partner of Pacific island nations, it also proposed deeper co‑operation in more sensitive areas, such as law enforcement, marine mapping, cybersecurity and within UN bodies. The leaking of the document before the meeting highlighted concerns within the region, and David Panuelo, the president of the Federated States of Micronesia, criticised the proposal.  

The agreement’s failure does not mean that Chinese influence in the region will retreat. The meeting still yielded commitments on furthering co‑operation in areas such as agriculture, climate change and poverty reduction, and China’s broad economic influence will probably rise steadily.

For the more controversial elements included in the Common Development Vision, China could pursue bilateral arrangements, as it has done recently on security with the Solomon Islands. The ability of the Pacific islands to retain a consensus-driven approach will be hindered by current divisions within the Pacific Islands Forum (PIF), the region’s main multilateral body, over its leadership. 

What next?

China will shelve the Common Development Vision and instead use it as a basis for further consultations, including at the bilateral level. Australia and the US, among others, will step up engagement in the region, both through PIF and bilaterally, having been alerted to the extent of Chinese ambition. Pacific island governments will welcome financing commitments related to climate change and expanded market access for their exports. Sprawling multilateral agreements backed by any major power will probably prove difficult to achieve.

More award-winning insights on China’s Pacific ambitions can be found in EIU Viewpoint, our new analysis service. EIU Viewpoint provides unmatched forecasts, analysis and data for nearly 200 countries and six key industries, helping organisations identify prospective opportunities and potential risks.