Australia’s aping Trump to foil China in the Pacific. But will it work?

Enlightened foreign policy professionals around the world are bemoaning Donald Trump’s crude transactional diplomacy, which leverages America’s size and power to bend smaller nations to his will. Canberra may not be as brash as Trump, but in our own neighbourhood, the Pacific, Australia has been quietly embracing a similar nakedly transactional approach. Recent agreements with Nauru, Tuvalu, Papua New Guinea and Solomon Islands have all carried clear conditions.

In other words, Australia will help, but only if you give us something in return. That is the price of influence.

Diplomacy entails a little scrummage: Papua New Guinea has been handed an NRL licence.Credit:

Decades of being the region’s largest aid donor have not delivered the political dividends and influence that some might have expected. The leaked China-Solomon Islands security pact shattered such illusions in 2022. Its aftershocks are still being felt from Canberra to Washington.

Yes, we share some common values with the region, such as democracy and histories going back to World War II and the waves of European colonial interest before that. But if Australia is truly part of the “Pacific Family”, as politicians frequently remind us, then it’s a family dynamic that looks more like Succession than The Brady Bunch.

Intensifying geopolitical competition between Australia and China – sometimes politely referred to as the pursuit of “strategic primacy” – has pushed Canberra to shell out record sums in grants and loans and to acquiesce to Pacific requests that previous governments would have dismissed outright. Bankrolling a Papua New Guinea NRL team with Australian taxpayer dollars, ahem.

In its Sisyphean struggle to keep China out of Pacific critical infrastructure and sensitive security partnerships, Australia has mobilised agencies across government and even enlisted the private sector into “Team Australia”. Most recently, this meant calling on the Commonwealth Bank to prop up Nauru’s banking sector. Before that, Telstra was voluntold to buy out Digicel, the largest telecoms carrier in the Pacific, so that a Chinese state-owned enterprise couldn’t get its mitts on it.

Australia’s new transactionalism has taken diverse forms. Last year, Tuvalu secured a world-first climate migration pathway to Australia in exchange for an Australian veto over its security policy. This makes Australia responsible for Tuvalu’s national security, and is intended to keep China out of it.

In December last year, the economically unviable tiny nation of Nauru agreed to receive a financial lifeline from Australia in return for a similar security arrangement.

Australia provided Solomon Islands a massive uplift to its law-enforcement assistance, also announced in December, in exchange for something of a gentleman’s agreement with Prime Minister Jeremiah Manele that his country wouldn’t look to China as a security partner of choice. Too bad that Chinese police are already training the Solomon Islands force.

Papua New Guinea was promised an NRL team in return for security assurances. Then, this month, it was revealed that Australia would provide a further loan of $570 million for budget support, the sixth since 2019 and bringing the total to over $3 billion, amid speculation that PNG agreed not to build a Chinese-funded undersea cable.

These deals are not inherently bad. Each, in isolation, may make strategic sense. But they reflect a deeper shift: Australia is now explicitly buying influence, one deal at a time.

And to be perfectly frank: it is Pacific governments that are fuelling this transactionalism, as they have become diplomatic price-setters amid intense geopolitical competition for strategic access to their sovereign spaces. If larger countries have found themselves jumping through hoops to curry local political influence in the region, it is Pacific leaders themselves who are holding those hoops.

Where does this unbridled transactionalism lead? By placing itself at the front of the queue as the security partner of choice for vulnerable Pacific nations, Australia is doing more than just securing diplomatic wins – it is also assuming responsibility for their stability and prosperity in ways that hark back to colonial-era paternalism. But for Australia, it may be a case of buyer beware.

Guaranteeing Tuvalu’s security from an implausible foreign invasion and agreeing to resettle 280 climate refugees annually is affordable. So, too, is keeping Nauru economically afloat, even if Canberra must overlook the nation’s governance challenges.

But Solomon Islands is orders of magnitude larger in both population size and the scope of the problem set. Australia’s $2.7 billion peacekeeping Regional Assistance Mission to Solomon Islands (RAMSI) from 2003 to 2017 apparently did not leave Honiara with the means to secure itself. If that sum was not enough then, it is hard to see how the $190 million package offered in December will suffice.

Papua New Guinea presents an even greater challenge. With a PNG population of about 12 million, no single external partner can fulfil all its security needs. Australia’s bilateral aid program to the nation is large, at almost $700 million a year. But as one former senior Australian official liked to note, that’s about what it costs to run Canberra Hospital for a year. Australian aid is not necessarily ineffective, nor is it misspent, but the scale of PNG’s needs means Australia cannot go it alone.

Australia has to take a serious note of the developments in the Pacific.Credit: Illustration: Andrew Dyson

Will this new conditionality be enough to keep China at bay? The commitments secured range from binding treaties with Nauru and Tuvalu, to “assurances” from Papua New Guinea, to “an understanding” with Solomon Islands PM Manele. Australia would have preferred legally binding instruments across the board, but diplomacy is often a game of getting the best deal available on the day.

Yet the fragility of these arrangements is already apparent. If Cook Islands is able to sign a comprehensive strategic partnership with China, despite its constitutional obligations to New Zealand, what does that say about the strength of Australia’s security assurances from Pacific nations? It underscores a simple reality: in diplomacy, politics trumps policy. And self-interest reigns above all.

Mihai Sora is director of the Pacific Islands program at the Lowy Institute.