The small island countries that dot the vast Pacific Ocean are sparsely populated and hard to pinpoint on a map. Yet in recent years they have become an arena for great power competition between the United States and China. 

What the Pacific island countries lack in landmass, they compensate for in their sway over large parts of the ocean thanks to their maritime boundaries, making them important allies even for much bigger powers. The U.S. Congress last week approved a new $7.1 billion funding package for its closest allies in the region, highlighting how the region’s fate has risen high up the agenda in Washington. 

This week, The Wire analyzes the state of relationships that the U.S. and China have with the Pacific island countries and assesses their importance amid both countries’ national security priorities.

A DROP IN THE OCEAN

The Pacific Islands comprise 14 countries, from Papua New Guinea in the west to Kiribati in the east, a span of some 4,000 miles. Their combined population totals more than 12.7 million, according to the World Bank. Some, such as Papua New Guinea and Fiji, have abundant natural resources and fish stocks, while others are small and highly vulnerable to rising sea levels thanks to climate change. 

For the U.S., the region is important strategically, for its role in the U.S. military’s “island chains” strategy. Alongside Washington’s sizable troop presences in Hawaii and Japan, the U.S. also controls Guam and the Northern Mariana Islands.

Within the Pacific Islands, the U.S. has rights to have military presence in the Federated States of Micronesia, the Marshall Islands and Palau — under the Compact of Free Association agreements (COFA), first signed in 1982 — helping it to ensure the security of Pacific shipping lanes. 

“If you’ve got a Pacific-centered map, you realize that this is a frontline between Asia and the Americas and has been for over a century,” says Cleo Paskal, non-resident senior fellow at the Foundation for Defense of Democracies. “Their three contiguous exclusive economic zones cover as much of the Pacific as the continental United States would if it were superimposed over the area.”

CHINA MOVES IN

China has been making substantial efforts to increase its influence in the region, winning over more countries in the Pacific with promises of commercial investments and infrastructure improvements. 

“The region sits on important sea lanes which supply Australia and the United States, connecting to the South China Sea,” says Meg Keen, director of the Pacific Islands Program at the Lowy Institute, an Australian think tank. “China is a global power, and it will seek global reach into this region.”

Beijing is also keen to secure support from these nations for its position on Taiwan. In 2019, the Solomon Islands and Kiribati switched diplomatic recognition from Taiwan to China, while in January the small island of Nauru also recognized China — the day after Taiwan’s presidential election. Even so, the Marshall Islands, Tuvalu and Palau remain among the few countries in the world to maintain diplomatic relations with Taiwan. 

“As soon as a country switches allegiance, China is very quick to set up their embassy and their diplomatic presence there,” says Keen. “That’s how you win hearts and minds; that’s how you build relationships that can endure beyond a political regime.” 

The U.S. has woken up to China’s spreading influence, particularly after Beijing and the Solomon Islands signed a security and policing pact in April 2022. The following February, the U.S. announced it was reopening its embassy in the Solomons capital, Honiara; it also plans to open a new embassy in Kiribati, which has also turned to China for help in expanding its law enforcement capacity, according to Reuters.

The following graphic shows the latest developments for Pacific island countries trying to navigate their relationship with the two major powers.

Australia remains the Pacific island countries’ biggest source of development aid, but China’s share had been growing strongly before the COVID-19 pandemic. Between 2008 and 2021, China provided more than 19 percent of the development aid for infrastructure projects in Pacific island countries, compared to 16.6 percent from Australia and 24 percent from the multilateral Asian Development Bank, according to data from the Lowy Institute.

China makes moves very quickly, and the institutions of state, especially free press and independent judiciary, get co-opted and democracy degrades.

Cleo Paskal, non-resident senior fellow at the Foundation for Defense of Democracies

“Aid to the region from China peaked in 2016; the dollars have been going down but not influence. While there’s less Chinese money going to this region; they’re doing smaller projects, there’s more of them and they’re strengthening relationships.,” says Keen. “Chinese state-owned firms are also winning many big multilateral bank infrastructure projects. That gives them presence at no cost to China.”

“We’re also seeing them move into rural and regional areas and winning hearts and minds more broadly,” adds Keen.

Congress’s vote to approve a 20-year funding package for the COFA countries followed months of deadlock on the issue, which observers warned was undermining U.S. credibility with its Pacific allies.

“China makes moves very quickly, and the institutions of state, especially free press and independent judiciary, get co-opted and democracy degrades,” says Paskal. 

However, U.S. ties with the COFA countries are strengthened by family ties and a history of local residents serving in the U.S. military, Paskal adds.

“They understand Congresses come and go, but there’s a deeper attachment to the United States, especially in those three countries,” says Paskal. “They have enough other touchpoints in their relationship with the U.S. that it can weather a lot of stress.” 

Being caught in a superpower competition could at least give the Pacific Islands a platform for voicing concerns which might otherwise be ignored. U.S. Secretary of State Antony Blinken visited the region twice in 2023. The previous year, then-Chinese Foreign Minister Wang Yi visited eight Pacific countries on a 10-day tour.

“What this geopolitical competition does is it gives them [Pacific countries] leverage that they’ve never had before, and they’re getting very clever at using that,” says Keen. “Some of these countries have never seen so much attention; aid levels have never been higher than they are at present. If you just look last year at the number of global leaders that visited this region — it’s unparalleled.”