PACIFIC Island nations took centre stage recently after news broke that China had approached the small island nation of Vanuatu with plans to establish a military presence there.
The base in question, less than 2000 km off Australian shores, would allow Beijing to bypass the “first and second island chains” which have historically cut China off from the rest of the Pacific. As expected, this did not go down well with Vanuatu’s neighbours. A base there would fit into a worrying broader pattern of expansionist Chinese moves—and the case of China’s first overseas base, in Djibouti, gives observers good reason to fear the establishment of another one.
According to Australian sources, China’s military machinations in Vanuatu would evolve in increments, possibly beginning with an access agreement for Chinese naval ships to dock for routine refuelling. This wouldn’t be the first time China has employed this tactic of “easing into” a military presence. Its outpost in Djibouti was officially first described by national outlets as support facilities for no more than 300 troops, before ballooning into an imposing fortress capable of hosting up to 10,000 soldiers.
China would likely rationalise a Vanuatu base the same way as it did in Djibouti, by the purported need to protect its trade routes. However, since this copy-and-paste explanation is spurious, international defence experts were quick to point out that Vanuatu’s location in the Pacific is an ideal site for the testing of sophisticated missiles, rockets to advance China’s space programme, and intelligence gathering.
As such, a Vanuatu base would be designed to counter the existing US presence in the region, most notably the significant American military installation on Guam. The base would simultaneously place Australia and New Zealand, major US-allies in the Asia-Pacific, squarely in Chinese striking distance. Predictably, Vanuatu’s Foreign Minister Ralph Regenvanu furiously denied that a military base was on the table, but not before the leaders of Australia and New Zealand expressed their alarm at the militarisation of the region.
Regenvanu’s denial will hardly serve to assuage the fears of America and its allies, however. After all, China’s Djibouti base is just seven miles from Camp Lemonnier— the only American installation in Africa and a vital hub for counterterrorism operations. The base marked a major milestone for Beijing and signalled its intentions to secure its growing economic and security footholds throughout Africa and the Indian Ocean.
Though Beijing continues to emphasise the base’s support and logistical roles in nearby peacekeeping operations, the growing alliance between the Middle Kingdom and Africa’s geopolitical gem has raised security alarms in Washington. Through expensive ‘gifts’ including a natural gas pipeline, a railway to Ethiopia, and two new airports, Beijing is progressively locking Djibouti into its sphere of influence.
And this economic and military partnership is already beginning to bear fruit and helps to explain why observers are sceptical of the planned Vanuatu installation. In February, Guelleh forcibly nationalised port facilities which service Camp Lemonnier, amid widespread rumours that a Chinese firm was lined up to take over the lucrative contract. Chinese money has rapidly transformed Guelleh from a dependable partner in the fight against global terrorism to a Chinese crony.
However, nothing that China does, regardless of Xi Jinping’s insistence to the contrary, is for free. For if the spending spree symbolises the importance China assigns to the country, then the investments come with an equally heavy price. While visiting Djibouti on his last trip as US Secretary of State, Rex Tillerson highlighted China’s use of “predatory economics” in the African nation. As a result of China’s massive investments, Djibouti owes Beijing $1.2 billion – a debt that nearly equals the country’s entire annual economic output.
China has tried out this same strategy of “predatory economics” in the Pacific, where China’s continuous hand-outs have inexorably bound several countries to the Asian giant through causing them to rack up crushing amounts of debt. China already accounts for nearly half of Vanuatu’s $440 million in foreign debt, giving Beijing tremendous influence and financial leverage over a country to which it has provided hundreds of millions over the past decade in grants and loans.
In Vanuatu’s capital Port Vila, the rarely-used $19 million-dollar National Convention Centre was built with Chinese money. Even the prime minister’s new offices were a ‘gift’ from China, and Beijing recently announced plans to build a new house for the president, a new Finance Ministry building and an extension to the Foreign Ministry building for a cool $36 million.
Similar stories are already playing out in nearby Tonga, Samoa, Fiji, the Cook Islands and Papua New Guinea. The ability of each of these nations to repay this rapidly accumulating debt is of grave concern.
The International Monetary Fund (IMF) recently warned that debt to China will trigger another far-reaching debt crisis. For Tonga, the relentless onslaught of costly Chinese presents already proved too much once before. In 2013-2014, it went through a debt crisis when it was unable to make repayments on its staggering Chinese debt.
One thing is clear – regional dynamics are changing fast. From Djibouti in the Indian Ocean to island nations like Vanuatu or Tonga in the Pacific, Western powers are getting increasingly squeezed. But as these examples show, the short-term boost provided by Chinese money will be outweighed by rising debt-burdens in the long-run. Countries tempted by Chinese spending should take note.