HMAS Choules

Supply ship HMAS Choules at anchor in Port Vila harbour. Australian and US strategic interest in Vanuatu has spiked of late.

Vanuatu, the country that some have called the Switzerland of the Pacific, is being asked to take sides.

First, the Undersecretary of the Navy came to visit. Then a Deputy Secretary of Defence. And Prime Minister Scott Morrison. And Foreign Minister Marise Payne on a whistle stop visit with no public agenda.

Now the ABC is reporting that top-level White House advisors, including a member of the National Security Council, have visited Vanuatu, along with Solomon Islands, Australia and New Zealand. Their recent visit to Vanuatu hints at two things:

1) James Mattis’ departure from the Trump administration hasn’t reduced American attention on the Western Pacific.

2) Vanuatu is going to have to make a choice about whose side it’s on: China or the Western Powers.

The choice would create opportunities as well as liabilities. On the upside, there is a great deal of development assistance being lined up. Even politically unpopular issues such as climate change become negotiable when strategic security comes into play.

And now there’s a new kid in town.

It seems that the United States is no longer content to delegate the task of watching over the Western Pacific to its Five Eyes colleagues. The recent spate of top-level visits to Vanuatu is evidence that Washington wants to see for itself what’s happening out here.

What does this say about the much-ballyhooed report that China was planning to establish a base in Vanuatu?

First the Department of Defence, and now the White House itself have sent their top people over. That suggests they’re taking the report seriously.

The newly created Directorate for Oceania and Indo-Pacific Security is evidence that folks in DC are convinced that someone needs to be watching us full-time—and that the role cannot be delegated.

We can read that two ways:

1) Washington thinks there’s something to the whole base thing, and wants to get direct assurances from Vanuatu that it’s not going to happen; or

2) Washington doesn’t trust Australian reports, and realises they have to establish their own networks.

Their may be some truth to both, but the first scenario seems more likely.

It neatly explains the visits from the undersecretary of the Navy, a deputy secretary of defence, and now two senior White House figures.

Sourcing on intelligence matters is always sketchy, but the evidence behind the base story points to Australia intercepting Chinese communications. Vanuatu officials remain adamant that they were not aware of any attempt by China to broach the topic of a naval base here in Vanuatu.

Multiple sources in Canberra suggest that members of the intelligence community indicated they were certain that ‘there is a plan’ in place for China to broaden its military footprint into the Western Pacific.

China’s Ambassador to Vanuatu Liu Quan was pulled from his post ahead of schedule, and his successor has maintained radio silence since he arrived. Ambassador Liu is now in Suriname.

Did he get caught out promising more than he could deliver?

And what does this mean for Vanuatu?

It would explain the increasingly us-or-them rhetoric coming from Australia and the USA. While they ramp up their efforts to provide development assistance, they are also making it clear that allegiance mean alliance.

And alliance means we’ll have to wean ourselves from the Chinese teat—or face a chilly reception from some soon-to-be-former friends.

This is cause for concern for the current government. Charlot Salwai’s coalition has been closer to—and benefited more from—China than pretty much any government before it. Distancing themselves from this cosy relationship could prove difficult, especially if China were to decide they’d get along better with a different crew at the helm.

When Serge Vohor tried to repudiate Vanuatu’s One China Policy and align the nation with Taiwan, he lasted barely six weeks before he was out on his ear in a no-confidence vote.

The biggest elephant in this very crowded room is the semi-licit sale of passports to Chinese nationals. The government of China has chosen to look away while their citizens purchase Vanuatu passports at US $155,000 each. Dual citizenship is not recognised in Chinese Nationality Law, but neither is it punished.

Vanuatu is becoming increasingly reliant on passport sales. In 2018, they represented about a third of all government revenues.

Without this money, many of the government’s plans and programmes would face shortfalls, and politicians would have to go into the 2020 election campaign with nothing to offer their supporters but austerity, budget cuts and a moratorium on large-scale development.

Australia and the United States have offered to ‘step up’ with development funding, but they have yet to explain how debt accumulated in Western-funded infrastructure projects would be any less onerous than Chinese debt.

The terms offered by multilateral lenders such as the World Bank and ADB are vastly better than China EXIM’s. But at the end of the day, debt is debt, and Vanuatu’s prospects for surviving—let alone thriving—in the next decade are not guaranteed.

Vanuatu’s preferred gambit is to be the ‘Switzerland of the Pacific’ as one analyst put it. Friend to all; enemy to none. If things did hot up at some point, we would revisit that stance. But for as long as possible, it makes infinitely more sense to cleave tightly to our Non-Aligned status and to avoid becoming too enmeshed with either side.

If our development partners had our interests at heart, they’d let us be.

But if the recent spate of high-level of activity is any indication, we may not have that luxury much longer. That could make problems for everyone where they only notionally existed before.

We could all find ourselves living in interesting times.

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