November’s historic Fiji meeting between China’s President Xi Jinping and eight Pacific leaders served to further solidify China-Pacific cooperation and project the superpower as one of the Pacific’s most generous donors. Meeting the leaders of Fiji, Papua New Guinea, Samoa, Tonga, Niue, Vanuatu, Federated States of Micronesia and Cook Islands on the tourist-populated Denarau Island, President Xi announced a host of China-funded projects aimed at developing island economies, building infrastructural facilities and tackling climate change. And, to further enhance endearment between China and its Pacific allies, President Xi reassured the eight Pacific leaders of his country’s policy of respect for their sovereignty and right to determine regional development and regional affairs. He also pledged China’s support for regional endeavours, at international level, aimed at safeguarding the Pacific region’s legitimate rights and interests. Referring to China’s stature as the world’s fastest growing economy, President Xi encouraged island leaders to learn from his country’s rapid development. As a result of the Fiji meeting, the island countries will benefit from 2000 scholarships and 5000 slots for various studies and training over the next five years. They will also have more Chinese medical teams visiting the region. China is also offering zero-tariff preference for 97 percent of tax items imported from the least developed countries
Memoranda of Understanding: Promising to attach more importance to China’s relations with the island countries, President Xi concluded a number of Memoranda of Understanding and Memoranda of Agreements in one-on-one bilateral meetings with the eight leaders. Most of the agreements signed, however, simply involved the process of implementing projects in the China-friendly Pacific nations to which China had pledged US$2 billion in aid funding at a meeting in Beijing in November 2013. The focus was on issues aimed at addressing poverty elimination, disaster reduction, food security, energy security, humanitarian aid and climate change.
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I f you have a project in mind, just ask Beijing for yuan. You stand a better chance of a generous handout or soft loan from China than any other donor. As government leaders begin preparing for the August meeting of the Pacific Islands Forum in the Cook Islands, China is certain to take a higher platform than any other issue. China—which has been the envy of the western world in recent years with a powerhouse economy and unprecedented growth surpassing even Europe and the United States—has carved a reputation in the islands region with multi-million dollar development aid to needy economies. Traditional donors like Australia and New Zealand could soon be overtaken by China as the leading contributor of aid to the islands economies. Last month, China became a focal discussion point in Sydney as investor concerns were aired at how swiftly the Asian giant was making inroads into the Pacific Islands Forum region.
China in PNG “We’re really just at the beginning of the game in terms of investment” by China in PNG,” a China specialist at the University of Sydney, Graeme Smith told investors last month. He noted that in the past five years to the end of 2010, Chinese direct foreign investment in PNG had quadrupled to US$323.3 million. Smith was speaking on the sidelines of a seminar on the future of PNG organised by the conservative think-tank, the Menzies Research Centre in Sydney. He said that while that amount was higher than Chinese capital investment in either New Zealand or Fiji that year, it was still only a fraction of the US$9.87 billion invested in Australia in 2010. In PNG, China’s largest project thus far is the 85 percent-owned US$1.5 billion Ramu nickel and cobalt mine and treatment plant that is now raising concerns in the Madang province, PNG’s northern region.
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