Australia discusses security, aid with Vanuatu amid competition with China

By Kirsty Needham

SYDNEY (Reuters) - Australia pledged to remain the South Pacific's largest aid donor on Thursday during security and economic talks with Vanuatu, as Canberra reviews the potential Pacific impact of U.S. President Donald Trump's foreign aid cuts.

"Australia will always be there for you," Australia's Minister for International Development Pat Conroy told a news conference in the Vanuatu capital Port Vila.

Conroy, who held talks with Vanuatu Prime Minister Jotham Napat, pledged another $3.2 million in direct budget support for Vanuatu after an earthquake in December flattened commercial buildings and killed 16 people.

"There is geostrategic competition occurring in the Pacific as great powers get interested in our region, but we are proud to be the biggest development partner," Conroy said.

Australia was there "well before any other countries, be it the United States or China, became interested in the Pacific", he added.

China is the second-biggest bilateral donor to the Pacific Islands after Australia, a Lowy Institute report on aid to the region found in November, 2024.

Australia and its main security ally the United States have been concerned at China's growing influence in the South Pacific and Trump's order to cut foreign aid has worried the region's small island nations.

Australian officials said Canberra was reviewing any potential impact from the Trump administration's funding cuts to the U.S. Agency for International Development (USAID).

In recent years Vanuatu has moved closer to China, which is its largest external creditor after a decade of infrastructure loans for construction including a new president's office last year.

China's navy, which upset Canberra by holding live fire drills in the Tasman Sea between Australia and New Zealand in recent days, has made repeated port visits to Vanuatu, where Beijing funded the expansion of a wharf.

A security treaty signed by Australia and Vanuatu in 2022 has not yet been ratified by Vanuatu's parliament, which has experienced a period of high political instability. Napat is the fourth prime minister since 2022.

Napat told reporters he had discussed economic cooperation and security with Australia.

(Reporting by Kirsty Needham in Sydney; Editing by Michael Perry)

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