A country three hours away from Australia is the next frontier of China’s ambitions

By Eryk Bagshaw and Natalie Clancy

China has been expanding its ambitions across the Pacific.Credit: Matthew Absalom-Wong

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The bright lights of a $120 million stadium complex built by China tower over the Solomon Islands capital. Below, the national hospital is so overwhelmed its patients are being treated with intravenous drips inside a tent in the car park.

Just three hours by plane from Brisbane, downtown Honiara is the centre of a country beset by contradictions, fast money and a growing power struggle. Now it finds itself on the next frontier of China’s political, economic and military ambitions.

“China is beautifying the country,” says 27-year-old Junita Javi as she lines up outside Honiara’s new national stadium with her four kids. “They give us more inspiration.”

Chinese-funded police vehicles outside Honiara stadium. Credit: Jack Donohoe

Tarcisius Kabutaulaka, a Solomon Islander and Pacific diplomacy expert from the University of Hawaii, says the country is in a tussle for its economic and diplomatic future as it hosts the region’s largest sporting event for the first time: the Pacific Games.

“One game is inside the stadium,” he says. “But there is a bigger game going on as well. It’s between the big powers China, Australia, and the United States.”

Australian officials were shocked last year by the sudden acceleration of a security deal between Solomon Islands and China, but The Sydney Morning Herald, The Age and 60 Minutes can reveal fresh allegations of intimidation in the Pacific as Beijing’s influence grows to encompass everything from infrastructure to media, mining, policing and healthcare in one of Australia’s closest neighbours.

“Why is it taking so long to realise that there is a potential vacuum here that someone could take advantage of?” says Alfred Sasako, the vice president of Solomon Islands-China Friendship Association.

Sasako is also an editor at The Solomon Star, one of the country’s largest newspapers. He says it would be a struggle to print the newspaper each night without hundreds of thousands of dollars in funding the company now receives from Beijing.

“China says that democracy is with Chinese characteristics,” says Sasako. “I strongly believe that if China had not offered what it did, I don’t think we would be in a position to host the Games.”

Many Solomon Islanders feel their government has no choice but to turn to China for help as one of the Pacific’s poorest countries struggles under the weight of endemic unemployment and growing allegations of neglect by the United States and Australia.

Aldred Sasako, an editor at The Solomon Star and vice president of the Solomon Islands-China Friendship Association. Credit: Jack Donohoe

The push is winning over locals who want their country to aim for more than an economy dominated by logging. But it is also dividing communities that say the government is too focused on optics while struggling to provide basic services.

“There are lots of Solomon Islanders who think ‘why do we have a flashy, huge-looking national stadium when we have a hospital next door that is collapsing?’” says Kabutaulaka.

Beneath the glistening new stadium, tales of exploitation are rife in villages that believe they have been caught between the ambitions of the Solomon Islands government and Chinese state-backed investment with little oversight.

In 2018, Chinese company Win Win Mining said it was confident it had found an ore reserve containing 200,000 ounces of gold in Turarana, two hours outside Honiara, a haul that would be worth more than $590 million in today’s gold prices.

Junita Javi (right) with her four children outside the Pacific Games stadium. Credit: Jack Donohoe

Win Win Mining’s initial investment report boasted of attracting “Chinese multi-millionaires” but some landowners say they have seen little since.

Locals were promised a school, a clinic, a community hall and a bridge by Win Win to get across a creek that divided their village. They say they ended up with the trailer from a mining dump truck for a bridge instead.

In August 2021, the company was found guilty of breaching the Customs Act after it attempted to smuggle almost two kilograms of gold out of the country. It was fined $350. Last year it had its license to mine nickel in a neighbouring province approved.

Turarana landowner Joel Jackson.Credit: Jack Donohoe

“They are treating us like animals,” says Turarana landowner Joel Jackson who claims he has only received $4 from the company to date after he protested proposed royalty payments of only 1.2 per cent for mining his village’s land.

“That is one bag of rice. They regard us like nothing.”

Win Win, which did not respond to requests for comment, has been feted by the Chinese embassy as an example of commercial co-operation between China and Solomon Islands.

Celsus Talifulu, a former political advisor to Prime Minister Mannaseh Sogavare and his rival Daniel Suidani, says the Chinese company’s approach is to win government contracts and local favour through a divide-and-conquer strategy.

“China is beyond everyone in terms of reading what is happening,” he says. “They have successfully captured the political elites of this country. And silenced their critics.”

“Then they use that as a platform for the influence to go down to the ordinary people.”

The national stadium complex was funded by China. Credit: Jack Donohoe

The structure of government in Solomon Islands has fuelled this power imbalance. It allows MPs to distribute millions of dollars in funds in their own electorates, through a constituency development fund, and for Chinese state-linked companies to negotiate directly with local landowners.

That system has made it difficult for targeted Australian government aid to compete with bags of cash from an ambitious new regional player that does not have to justify to voters how it spends its money.

Between 2008 and 2022, Australia contributed $3.2 billion in aid to Solomon Islands according to the Lowy Institute. But there is little evidence of that on the streets of Honiara, where Chinese branding covers everything from the national stadium to the new cardiac hospital wing, to new police vehicles.

Asked in Beijing last month if he was concerned by China’s intentions in the Solomons, Prime Minister Anthony Albanese said it was important for Pacific nations to look after their own interests.

“But the Pacific family is also made up of sovereign states, so we respect the fact that sovereign states have a right to make their decisions,” he said.

As it grapples with its own domestic economic woes, China has shifted its aid strategy for much of the region from “loud and brash” to “small and beautiful,” according to the Lowy Institute’s Pacific Aid Map.

But throughout the Solomons, the four years of spending by Beijing that followed Honiara’s diplomatic switch from Taiwan to China in 2019 has paved the way for Chinese-run projects to proliferate throughout the South Pacific’s second most populous country.

“The constituency development fund, in my view, is the main culprit,” says Talifulu. “The officials from the Chinese embassy were clearly saying that if you join the camp here, you could be supported.”

Sogavare’s former advisor Celsus Talifulu says China is beyond everyone in terms of reading what is happening in the Solomon Islands. Credit: Jack Donohoe

The deputy leader of the national opposition, Peter Kenilorea jnr, claimed in 2020 that government MPs were offered bribes of more than $200,000 to switch diplomatic allegiance from Taiwan to China. These allegations were denied by the government. Then in 2021, Sogavare survived a no-confidence motion after riots broke out in Honiara fuelled by COVID-19 isolation and concerns over the government’s shift from Taiwan.

Budget documents show that in that year China provided $16 million to the constituency development fund – double what Taiwan paid into the scheme.

“So that’s a direct connection between Chinese money in our political leaders,” says Talifulu.

Asked in Honiara last week what China expected in return for its funding Sogavare said he had to go to another engagement for the Pacific Games. An advisor said: “Nothing”.

Celsus Talifulu.Credit: Jack Donohoe

China’s representative at the Games, vice chairman of the Standing Committee of the National People’s Congress Cai Dafeng, said in a statement that “diplomatic relations between the two countries had developed rapidly” and “had become a role model of co-operation between developing countries”.

But Sogavare is not the only leader of a country competing at this year’s Pacific Games to have been courted by Beijing.

Until May this year, David Panuelo was the president of the Federated States of Micronesia, a country of 100,000 people spread across 600 islands.

Solomon Islands Prime Minister Manasseh Sogavare. Credit: AP

“Today I am just as concerned if not more about the Chinese activities in the Pacific,” he says. “I think they are getting bolder by the day.”

New documents seen by this masthead and 60 Minutes reveal that Chinese officials re-drafted agreements to suit Beijing’s interests and wrote entire statements on behalf of foreign elected leaders.

In one internal email, Panuelo’s Foreign Secretary Kandhi Elieisar says China’s Ambassador to Micronesia Huang Zheng urged him to sign documents committing the country to a new development deal with Beijing without the president’s knowledge.

“He did not give up and even suggested to me that I sign it despite the instruction to hold off,” Elieisar said in an email to colleagues. “I don’t want wolves in our backyard.”

David Panuelo with Anthony Albanese and Jacinda Ardern.

“He even asked what would happen if I signed ignoring the instruction. Did he even have to ask that? I told him I would not have my job.”

Panuelo says development agreements were carved out by China and then presented as a done deal to Pacific leaders who had limited resources to get across the legal and economic implications of the proposals.

“If you don’t see the fine line in what they are trying to get and do, it can sort of trap your nation in ways that you would not know about,” he says.

“It was going to allow China to come into our Exclusive Economic Zone [sea territory] and basically do what they want.”

During his time in office, officials including Vice President Aren Palik were offered cash in envelopes by Chinese officials.

One Micronesian attendee of a week-long trip to China received a little red envelope filled with cash worth more than $5000 in “pocket money”.

“They may call it gifts, but these people can be influenced deeply,” says Panuelo.

Panuelo says he has been the target of Chinese government hostility since he opposed Beijing’s Pacific-wide economic and security deal in May 2022. Chinese officials first followed him overseas at the Pacific Islands Forum in Suva in September that year.

The Chinese Foreign Ministry rejected Panuelo’s claims as groundless smears. “They are completely inconsistent with the facts,” the ministry said.

But he now claims Chinese officials went even further, tailing him outside his own home in Micronesia after he left office this year.

“A vehicle drove down to my house, and they were taking pictures,” he says. “I followed it and asked them why they were taking pictures of me. They said they were tourists.”

Panuelo later confirmed they were officials from the Chinese embassy. The Chinese embassy in Micronesia was contacted for comment.

“We’re a small country. We’re not protected by 24-hour police,” said Panuelo. “Even as a former president, I had that experience.”

Panuelo, like many Pacific Island leaders, has also tried to turn the heightened geopolitical interest in the Pacific to his advantage. In March, he wrote a letter to state governors and other Pacific leaders detailing his concerns about China’s actions.

Then Panuelo told Taipei what it would cost for Micronesia to switch its diplomatic allegiance from China to Taiwan: $US50 million.

That high-stakes game of diplomatic arbitrage is now being waged by Sogavare who hopes the Pacific Games will springboard him into next year’s elections.

China has tipped in more than $120 million to the Games, Australia has contributed $17 million, while the US has parked its USNS Mercy in Honiara harbour, a ship that would be the eighth-largest hospital in America if it was on land.

The USNS Mercy in Honiara harbour. Credit: Jack Donohoe

“It continues to be in our interest to have an Indo-Pacific that is free, open, stable, and consistent with international norms and standards,” says the US Commander of the Pacific Partnership, Captain Brian Quin.

In August, China sent its own hospital ship, The Arc of Peace, into Honiara harbour with the capacity to treat 600 patients. The Chinese embassy in Solomon Islands did not respond to requests for comment.

Quin rejects claims that the Americans are projecting their own form of power in the region.

“It’s not about projecting power; it’s about projecting co-operation,” he says.

Kabutaulaka, the Pacific diplomacy expert, studied at university with Sogavare. He says Sogavare has played Australia, the US and China “off against each other”.

The US Commander of the Pacific Partnership, Captain Brian Quinn. Credit: Jack Donohoe

“I sometimes feel that what they’re doing, especially towards Australia and the US and other Western countries, is not so much because they think that it’s the right thing, but because they can do it now that China is there,” he says.

“China is projecting [this] image, not only to the Solomon Islands but to the rest of the Pacific in saying that if you have a relationship with China, this is what you can expect.”

In Honiara, one of the most visible impacts of China’s investment is the two giant anti-riot trucks that patrol the streets next to the national stadium.

A Chinese anti-riot truck outside Honiara stadium. Credit: Eryk Bagshaw

The armoured vehicles are aimed at putting a stop to the violence that has dogged previous Solomon Island governments, but they have also come with a Chinese police presence and dozens of firearms.

Sogavare delayed last year’s election to 2024 to host the Pacific Games. Armed with a clear majority in parliament, and a development fund largely made up of Chinese financing, Talifulu says he would not be surprised if he delayed it again.

“Especially with security everywhere. That could give him the opportunity to further amend the constitution, to keep his government continuing,” he says.

When he was working in Sogavare’s office in 2019, Talifulu claims he overheard Sogavare and his nephew advocating for a different type of rule in Solomon Islands.

Talifulu says they admired Frank Bainimarama, the Fijian leader who installed himself as prime minister in 2007 after a coup and ruled for the next 15 years.

“So like a dictator, but a soft one,” he says.

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