Pacific Aid Donors Grapple With China’s Rise And Influence

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China one of top 3 regional donors, ongoing debates over transparency

WELLINGTON, New Zealand (Radio New Zealand International, March 2, 2015) – The traditional external powers in the Pacific Islands are still coming to terms with China's increasing level of engagement with the region.

That was the focus of a conference this week at the National University of Samoa; 'China and the Pacific: The View from Oceania,' that sought to counter misperceptions about China's role in the region, particularly its aid programme.

Organised by Victoria University's Contemporary China Research Centre in conjunction with the Centre for Oceania Studies at China's Sun Yat-sen University and Samoa's University, the conference pulled together a wide range of scholars and policy makers including rarely-heard Chinese voices on the issue.

In the last decade, China's rapid growth has found it eager to spread its influence in a number of regions around the world, including the Pacific.

There are economic and security reasons for this, but also, China said, because it wants to help smaller countries.

Recently, China announced a US$2 billion loan facility available to Pacific countries in the next few years.

China's Ambassador to Samoa, Madame Li Yanduan, said China was taking its role as a leading member of the global community seriously.

"It is our belief that common development is good for the interests of China and also the rest of the developing countries," said Ms Li.

"That's why we think the Pacific Island Countries are important and we would like to contribute something to the development of the region."

While Australia is still far ahead as the region's biggest aid donor, China has rapidly risen to enter the top three to sit alongside the United States, ahead of Japan and New Zealand.

However, exact figures and data on China's aid programmes in the region have not been readily available, something Philippa Brant, a specialist in Chinese aid in the Pacific with the Lowy Institute for Public Policy, said makes finding out the true value of Chinese aid to the Pacific difficult to gauge.

"The challenge is that we do have an expectation around transparency with some of our traditional development partners," she said.

"I think the challenge for China is that it has a small aid bureaucracy managing a rather large programme that's now one of the largest donors in the world.

"Their statistical ability is not to the same level as other donors and so we have an expectation on China that, at the moment, they can't meet," said Dr Brant.

Chinese officials said effectiveness, rather transparency, was the country's priority.

However, various complaints had emerged from recipient countries about the quality of the aid projects.

Dr Brant says 78 percent of Chinese aid in the Pacific is in the form of concessional loans, which typically mean projects for building infrastructure such as roads and hospitals are carried out by Chinese contractors.

Dr Brant said there are concerns about a lack of follow-up.

"We have traditionally seen a concern in the region about ongoing maintenance costs of some of these projects," said Dr Brant.

"But, to be fair, both the Pacific Islands governments and the Chinese are realising that there needs to be some change in the way that these projects and programmes are implemented."

Yet, to the apparent surprise of some traditional partners, Pacific government have indicated that China is often more responsive to their needs.

Paul D'Arcy, from the Australian National University's College of Asia and the Pacific, said that at the same time, Island leaders have learnt how to seek out beneficial aid parnerships.

"What we are now seeing in the nature of Chinese aid is that we get Chinse entrepreneurs or Chinese companies coming and saying, 'what do you want?', because they have to go and then sell that to Chinese state banks and so it's very much more so a partnership at a ground level getting these aid programmes going," said Mr D'Arcy.

Terence Wesley-Smith, the director of the University of Hawaii's Centre for Pacific Studies, said China's foray into the Pacific was the biggest challenge yet to influence the region of the traditional external powers - Australia, New Zealand and the United States.

"It's not a military challenge," said Mr Wesley-Smith.

"It's a challenge to a sort of regime of aid and support tht's been developed over many decades and it's a regime of support which comes with an agenda."

Professor Wesley-Smith said, for instance, Australia's aid to the Islands is often tied to conditions around political and governance reform and neo-liberal economic opportunities.

"There's sort of been a monopoly of aid donors who are agreed that these are the conditions and that monopoly has now effectively been broken by the emergence of China as an alternative aid donor which offers support without political conditions, and from the islands' perspective, I think most Pacific leaders, at least, welcome this because it offers them new opportunities that they didn't have before -- new trading partners, new possible sources of investment, and possibilities of working with powers other than traditional external powers."

Prime Minister Tuilaepa Sailele Malielegaoi of Samoa said China's in the region filled certain gaps.

"The problem of course is that different countries, development partners of the region, have different priorities, and that's why I mention that China comes in as providing supplementary resources available to the region, coving those areas which are not covered in traditional aid donor programmes," said Tuilaepa.

Professor Liu Hongzhong of the Centre for Oceanian Studies at Pekin University said some western countries were not used to seeing China's aid efforts in the region.

"China has a big population and people will have doubts about the motives and whether they're going to take the lead or change the rules, or whatever.

"So why don't we just take China as another traditional member of the donors," she asked.

"If New Zealand or Australia were going to donate, would anyone have doubts about their motives?"

A number of delegates at the Samoa conference were at pains to point out that there was room for a wide range of partners in the Pacific region.

Ambassador Li said China was looking to usurp other donor countries, but to work together.

"We think the diplomatic corp, we think it's quite open and people just exchange the information about the assistance, development, land - something like that."

China has recently shown that it is increasingly flexible and learning more about aid delivery by working with other donor countries in the Pacific, such as with Australia on malaria prevention in Papua New Guinea, and with New Zealand on a tripartite water project in the Cook Islands.

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