Beijing's embrace spreads irresistibly across the Pacific

China-watchers have differing views on whether its growing influence in the Pacific is benign. Photo / NZ Herald

Twenty years ago, China had four diplomatic posts in the South Pacific.

New Zealand and Australia had 10 each. The United States, the big regional power, had six.

Two decades on, China has more diplomats in the region than New Zealand and Australia combined - a surprise given Beijing only has relations with eight of the 14 Pacific Islands Forum members.

For a newly elected head of government from the region, the first foreign port of call is likely to be the Great Hall of the People, and not Canberra, Washington or the Beehive.

Does this matter? Perhaps less so now that tensions between Taiwan and China have cooled. Previously intense rivalry between the two drove chequebook diplomacy.

Taipei and Beijing spent years wooing small Pacific nations to sign up to their particular China brand. Taiwan got six forum countries on board, but a truce has existed since the election of President Ma Ying-Jeou in 2008.

But even as the political courtship has softened, money in the form of soft loans and grants continues to pour into the region. Beijing has put up cash to lift trade, build schools and bridges, train senior military officers and in the case of Fiji, fence the president's palace.

China is one of the region's top three aid donors, after Australia and the US. A study by the Sydney based-Lowy Institute puts its 2009 aid to its recognised forum members at US$209 million (NZ$267m). Australia, the top regional donor, gave US$650 million to the 14 forum countries. New Zealand gave about US$100 million.

United States Secretary of State Hillary Clinton thinks the West needs to be awake to China in the region. Last month she railed against cuts sought by Republicans to the US foreign aid programme, telling senators: "Let's put aside the humanitarian, do-good side of what we believe in. Let's just talk straight realpolitik. We are in competition with China."

She noted a "huge energy find" in Papua New Guinea by the oil giant Exxon Mobil, which has begun drilling for natural gas. Clinton said China was jockeying for influence in the region and seeing how it could "come in behind us and come in under us".

She claimed China had taken the leaders of small Pacific nations to Beijing and "wined them and dined them". "We have a lot of support in the Pacific Ocean region. A lot of those small countries have voted with us in the United Nations, they are stalwart American allies, they embrace our values."

Foreign policy expert Associate Professor Stephen Hoadley of Auckland University agrees.

"I would call the impact of China mildly disruptive," he says.

Beijing did not consult countries with a history in the region, and its investments could seem out of kilter with small island needs.

Adds Hoadley: "They can be a little bit corrupt, they often engage in under-the-table favours. That's why the leaders in the Pacific Islands are very happy to have these shonky projects, they get VIP trips to Beijing, they may get other things though that is unconfirmed."

He says the Chinese Government was not necessarily culpable, though it might be negligent in that it sub-contracted work to companies which used inferior supplies, cut corners, ignored the local workforce and left behind projects of dubious value.

"A lot more consultation would be welcome," suggests Hoadley.

But does China have any discernable workplan to displace the traditional Western players in the region for its own national security?

China has been part of the region for more than 150 years. Thousands of indentured labourers worked in plantations and phosphate mines in the 19th century, becoming the ancestors of the small but often successful Chinese communities in most Pacific Island states.

New Zealand Foreign Minister Murray McCully does not see any "unwholesome motives" in China's Pacific strategy. He argues the equation is quite simple. Pacific states have minerals, timber and fish - and China is a hungry buyer.

He told a high level gathering of China watchers last week in Wellington: "China is simply doing in our neighbourhood what it is doing in every neighbourhood around the globe: undertaking a level of engagement designed to secure access to resources on a scale that will meet its future needs, and establishing a presence through which it can make its other interests clear."

But McCully wants Beijing - and Taipei - to be more transparent with the money they shower on island states and has urged China to ensure its loans do not burden small nations with debt.

Political scientist Jian Yang, who has book coming out about China's strategy in the Pacific, expects Beijing's influence in the region to grow, along with other major players including Japan, India and the US.

New Zealand, he argues, has historic, cultural and economic ties to the region which are not easily replaced.

"What is crucial is for New Zealand to continue its dialogue with China and the other powers."

So far, concludes Yang, New Zealand has done well.