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The Bilateral relations between Australia and the island states of Oceania

There is one topic that is spoken about in hush tones, but that keeps plaguing the minds of Australians, and that topic is often referred to “elite capture”. Taking advantage of the growing poverty in the Pacific region, along with the dissatisfaction of multiple Oceanic countries about how Australia is treating their citizens, China has started to grow influence in the region. China is the largest trading partner of most of the countries in the Indo-Pacific, and, in poor countries such as the Solomons or Vanuatu, Chinese wealth can help turn citizens and governments into supporters of Beijing. Australia, due to its’ geography, trade and investment links, tourism, aid, defense assets and sport, has exercised a dominant influence in the Pacific Islands region, for at least three decades. But, due to their location, the Pacific Islands have high strategic value, as they impact the U.S. military’s ability to project force and collect intelligence across the Indo Pacific. Control of this area would hurt the U.S.’s ability to transit to, intervene and resupply in a Taiwan Strait contingency, should Beijing decide to launch military operations against the self-ruled island nation.

Despite the economic rise of China and impediments to trade from the isolation of many Pacific island countries with limited infrastructure, Australia remains a major trading and investment partner and can play a key role into maintaining peace in the area. The purpose of this analysis is to examine the nature of Australia’s relationships with several key island states in Oceania, identify the main drivers and challenges of these relationships and understand how they can shape the future of the region.


The island state of Fiji is one of Australia’s closest partners in the Pacific. With trade between the two countries totaling 1.3 billion in 2021, it is clear that Australia and Fiji have a long history of close ties, including shared military and political experiences, as well as cultural and economic exchanges. Australia has provided significant development assistance to Fiji, particularly in the form of support for infrastructure projects and human development programs.

The Australian government’s 2022-23 budget provides $1.9 billion in foreign aid for the Pacific, which includes $88 million for Fiji. Australia’s Minister for International Development and the Pacific, Pat Conroy says the budget is a significant one for the region, as it prioritizes the expansion of financial infrastructure. “(We) have had thousands of Fijian workers working in the Australian community. All these represent and signify the deep commitment the new Australian government has to support the hopes and aspirations of the Pacific.”

But, despite this, there have been some challenges to the bilateral relationship in recent years, including political instability in Fiji and concerns about the country’s human rights record. The government, led by Prime Minister Frank Bainimarama, has faced criticism over its handling of opposition political parties and civil society groups and, there have been calls for greater protections for freedom of expression and freedom of assembly..


Another important island state in the Pacific region is Vanuatu, which has close economic and cultural ties with Australia. The relationship between Vanuatu and Australia is marked by a complex mix of cooperation and mutual dependence. The two countries are separated by a large distance, but they share a number of important interests in the Pacific region, including trade, security, and environmental protection. Vanuatu is a major recipient of Australian development assistance, with the two countries working closely together to support economic growth and address pressing issues, such as climate change. Vanuatu and Australia also have strong trade links, with Australian exports to Vanuatu totaling AUD 105 million in 2021.

However, there have been some challenges to the bilateral relationship, including concerns about the increasing influence of China in the Pacific region and tensions over the treatment of Vanuatu citizens in Australia. In Vanuatu, China has been investing in infrastructure projects, including the construction of roads, bridges, and buildings. It has also been providing development assistance, including aid programs and scholarships for students. These investments have helped to boost economic growth in Vanuatu, and have made China an increasingly important partner for the country.

Vanuatu has also been a strong advocate for greater independence and sovereignty in the Pacific region, and has sometimes taken positions that are at odds with Australian interests. For example, Vanuatu has been a vocal opponent of the Australian-led Pacific Islands Forum, which it sees as “dominated by larger regional powers”.

Papua New Guinea

The island state of Papua New Guinea is another key partner for Australia in the Pacific region. In December 2021, Australia provided PNG with a $650 million loan to help meet its 2021 Budget financing shortfall, assist with the ongoing health and economic impact of the COVID‑19 pandemic, and continue its progress on economic reforms under the International Monetary Fund Staff‑Monitored Program.  In total, Australia has provided PNG approximately $1.2 billion in Budget support since 2019.

Australia and PNG share an interest in a secure, stable and peaceful region. Negotiations are underway on a Bilateral Security Treaty, a key outcome of the Comprehensive Strategic and Economic Partnership, intended to better represent the breadth of their security cooperation. In return, PNG has been a key partner for Australia in regional security initiatives, including the Pacific Islands Forum and the Pacific Patrol Boat program.

However, there are also areas of conflict between the two countries, particularly in the realm of diplomacy. PNG has been a strong advocate for greater independence and sovereignty in the Pacific region, same as Vanuatu, and, has raised concerns about the treatment given to PNG citizens. According to Amnesty International “PNG citizens in Australia face challenges, particularly those who are living in the country illegally or who are seeking asylum. These individuals face discrimination and racism, as well as difficulties accessing essential services and support. They are also vulnerable to exploitation and abuse, particularly in the workplace.”

Solomon Islands

An archipelago of almost 1,000 islands in the southern Pacific with a total population of about 700,000, the Solomons seem like an idyllic place for a vacation, and are rarely thought of as a political power, but more as region that doesn’t have any strategic influence. This is far from the truth. Despite their remoteness, the Solomon Islands have become a pawn in the growing strategic rivalry between China and the West. The signature of a security pact between the Solomons and China in April, sparked alarm in Washington and Canberra. Back in the second world war, The Solomon Islands were the backdrop of the battle of Guadalcanal, in which more than 7000 Americans perished trying to reclaim islands from Japan.

Australia has not forgotten the fact that, the bombing of Darwin in the second world war, pulled them into the conflict. It’s a scenario the country wants to avoid from repeating, which is why, if China wants to follow the “modus operandi” of Imperial Japan and challenge US influence in the Pacific, the Solomon Islands would be a strategic place to start! At the end of the day, the islands lie directly across the sea lanes between Australia, East Asia and the western US.

Tensions in the area become clear in late March 2022, when Australian Foreign Minister Marise Payne and Defence Minister Peter Dutton expressed opposition to a draft security pact between China and the Solomon Islands that would allow Beijing to deploy military forces in the country and establish a military base.  In response, Solomon Islands Prime Minister Manasseh Sogavare defended the security pact with China, criticizing the leaking of the document and objecting to the Australian media’s coverage of the security pact.

However, in an attempt to reduce Chinese influence in the area, Australia has started to increase their own influence in the Solomons. Along with bolstering trade and aid, Australia has delivered vehicles and rifles to the Solomon Islands police force.

What’s next?

As of 2022, some analysts have expressed concerns that China’s investments in the region could be used to gain political influence, or to gain access to strategic assets, such as ports or airports. Australia’s continued engagement with these countries will be critical for maintaining stability and promoting economic growth in the Pacific region.

Future instability in the region — whether it is a further breakdown in law and order in the Solomon Islands, internal conflict in the Southern Highlands of Papua New Guinea, civil unrest in any island country, or population movements driven by climate change — will demand a swift Australian response. Affected governments and citizens will look to Canberra for help or guidance.  And Australia must answer their call!

By Ioana Constantin

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