Foreword
Have you ever heard of the country of Palau? Do you know where it is located? And did you know that its population is less than 20,000, which is even smaller than a third-tier city in Australia? However, a media institution in Palau has received investment from Chinese enterprises to build it into an international news hub. This is not a fairy tale, but an incredible reality brought about by the struggle between the two major powers of China and the United States. Palau is a republic located in the western Pacific, consisting of 340 islands, with settlement dating back to 3,000 years ago. Today, its population is around 20,000, and its area is 459 square kilometers, which is about 40% of the size of Hong Kong. Its economy is mainly based on tourism. The majority of its residents are the Ngatpang people who believe in Christianity. Its governance system is a presidential system, and it implements the Anglo-American legal system. It is one of the few countries in the world that has diplomatic relations with the Republic of China (Taiwan). Recently, US Secretary of State Antony Blinken visited Tonga, New Zealand, and Australia to accelerate the promotion of US strategy in the Indo-Pacific region. At the same time, the media also reported the failure of a transaction between a Chinese-funded enterprise and a Palau media institution, demonstrating that both China and the United States are trying to expand their influence in the Pacific. Once again, the Pacific region has become a battlefield between rising Asian powers and Western rivals. Palau, this inconspicuous small island, has received recognition from the leaders of major powers and even investment from Chinese enterprises, making the world aware of its existence and the value of its independence.
Penetrating Media, Manipulating Public Opinion
Since 2015, China’s united front system has begun to expand overseas, using “legitimate cover for illegitimate purposes” to penetrate campuses, media, overseas Chinese communities, overseas companies, and even foreign governments. China’s recent significant increase in investment in Africa has become a hot topic in public opinion as it expands its political influence internationally. The recent failed transaction between a Chinese-funded enterprise and Palauan media shows that China’s influence has extended to the Pacific region.
More than 50 years ago, when the Palau Islands were still under US jurisdiction, Moses Uludong founded Palau’s first newspaper, Tia Belau. Although this country with a population of 18,000 became independent in 1994, Palau remains a close ally of the United States and is one of only 13 countries worldwide that recognize Taiwan diplomatically and oppose China. As tensions between China and the West intensify, Uludong believes that if a war breaks out between the two great powers, Palau may suffer catastrophic destruction. Therefore, in 2018, Uludong agreed to establish a new media group, the Palau Media Group.
Although the new media group held its launching ceremony in Hong Kong, it never fully took off. It was reportedly the idea of Tian Hang, an old friend of Uludong who runs a Chinese hotel on the island. Tian Hang stated that the purpose of establishing the company was to increase Palau’s visibility in China and make it an “information hub” bringing news from the Pacific region to Chinese audiences. Uludong believed that establishing a joint venture company would help restore some balance, but he never expected that the investors in this agreement would have connections with the Chinese police and military. Reports indicate that shortly after the joint venture was established, Tian Hang used an existing newspaper owned by Uludong to publish content supporting the Chinese government.
Through Mr. Tian, at least two Palauan governors visited Hong Kong, and Mr. Tian provided a press release for their itinerary, claiming that “Palau’s highest officials publicly support the shift in diplomatic relations from Taiwan to China.” The article also referred to Taiwan as a “renegade province of China.”
The largest shareholder in the joint venture company is a Chinese-funded big data group that collaborates with the People’s Liberation Army and the universities and research institutions under the Public Security Bureau. The company, Overseas Chinese Big Data Group (OCBD), is headquartered in Shenzhen, China. According to documents in Hong Kong, when the Palau Media Group was established in November 2018, OCBD owned 40% of the group, with a capital of HKD 1 million (approximately AUD 18,890). Mr. Tian and Uludong each held 30%. The Australian Strategic Policy Institute (ASPI) think tank stated that OCBD collaborates with the PLA Information Engineering University in Henan, focusing on training “political warfare officers and conducting offensive cyber operations.” This has immediately cast a “spy-colored” shadow over the group’s investment in Palauan media.
However, due to the COVID-19 pandemic, Tia Belau has not published articles from Mr. Tian since. Similar situations have also occurred in other Pacific island countries’ media. It can be said that as long as it is an independent country’s media, no matter how few readers it has, there are Chinese investors willing to infiltrate information promoting China’s international image into these media.
Unwilling to Fall Behind, Accelerate the Advancement
As China’s influence continues to expand, US Secretary of State Antony Blinken attended the opening ceremony of the new US embassy in Nuku’alofa, Tonga this week, before traveling to Wellington, New Zealand to watch the US women’s soccer team play the Netherlands in the FIFA Women’s World Cup. Blinken will then meet with New Zealand officials and attend the annual 2+2 Australia-US Ministerial Consultations (AUSMIN) with US Defense Secretary Lloyd Austin, Australian Deputy Prime Minister and Defense Minister Richard Marles, and Australian Foreign Minister Marise Payne in Brisbane from July 28th to 29th.
Blinken’s visit comes a week after the State Department notified Congress of plans to significantly increase the number of US diplomatic personnel and expenses for new embassy facilities on Pacific islands. The State Department’s latest report to Congress indicates that China has permanent diplomatic facilities in eight of the 12 Pacific island countries recognized by the United States and that the United States needs to catch up. Specifically, the State Department envisions employing up to 40 staff members at each of the four newly opened or soon-to-be-opened embassies in the Pacific region over the next five years. The Biden administration is accelerating the implementation of its Indo-Pacific strategy, in part to counter China’s growing influence in the region.
In fact, the United States has been laying the groundwork in the Indo-Pacific region for some time. Earlier this year, the United States signed a security agreement with Papua New Guinea that allows the US military to develop and operate military bases on the Pacific island. US personnel will have “unimpeded access” to these locations to “preposition equipment, supplies, and material” and have “exclusive use rights” to certain areas of the bases for development and “construction activities.” As the competition between Washington and Beijing intensifies, this agreement opens the door for Washington to establish a new military presence in the western Pacific.
All of this is part of Washington’s efforts to woo Pacific Island countries with a series of diplomatic and financial incentives in exchange for strategic support. China has taken similar measures in the past, with Chinese companies acquiring mines and ports on a large scale in the Pacific region. Last year, China signed a secret agreement with the Solomon Islands, which is located near Papua New Guinea, allowing China to deploy its military there. Washington is concerned that China’s military foothold in the South Pacific may encircle US facilities in Guam and increase the difficulty of defending Taiwan in the event of a mainland Chinese invasion. The use of the Lombrum Air Force Base could be critical for the US military to strengthen its facilities in Guam in the event of a conflict in the Taiwan Strait.
Power Struggle Gradually Intensifies
Apart from Australia and New Zealand, there are more than 20 countries and regions in the South Pacific, including Papua New Guinea, the Solomon Islands, the Marshall Islands, Fiji, Tonga, Palau, Nauru, and so on. The Pacific Island countries are an important region linking South Asia and South America. During the Cold War, the United States and its allies, New Zealand and Australia, actively defended the region to contain the expansion of the former Soviet Union. After the collapse of the Soviet Union in the 1990s, the United States gradually lost interest in the region and withdrew from its management of the area. Later, China, which was rising on the world stage, began to understand the strategic importance of the region and gradually brought its influence into the area through economic investment. This also caused a sense of crisis in the United States, which in turn sparked a series of operations to “return” to the South Pacific.
The Pacific region is also crucial to Beijing for a big reason, which is Taiwan. Four of Taiwan’s 13 diplomatic allies are from the South Pacific, namely the Marshall Islands, Nauru, Palau, and Tuvalu. Marshall Islands (1990-1998) and Nauru (2002-2005) have established diplomatic relations with Beijing. Therefore, the diplomatic competition between the two sides, coupled with the long-standing confrontation between the United States, Australia, and New Zealand and China, has become increasingly fierce in recent years. Beijing hopes to expand its political influence through its economic influence, with the goal of removing the influence of the United States, Australia, and New Zealand in the region.
Since last year, the power struggle between the United States and China in the Pacific region has escalated rapidly. In September 2022, the United States and all 14 Pacific Island countries reached a historic declaration of a joint partnership, while China’s efforts to achieve a similar agreement failed. Australia has also been seeking to counter China’s influence, such as further increasing aid to the Pacific region and committing to increasing spending on the region’s development by nearly AUD 1.4 billion over the next four years. Previously, Australia and Fiji reached an agreement to strengthen defense cooperation, and a security treaty with Papua New Guinea is currently being brewed.
The power struggle between the US and China has put the Pacific island nations in an awkward position. The world situation has undergone dramatic changes in recent years, and most countries have realized that their national interests need to be protected by themselves. Especially for small and weak countries, they are aware that balancing relationships is the way to ensure their own security in the tense situation of great power confrontation. At this time, Pacific countries are more inclined to pursue a diplomatic policy of not taking sides and making friends with all, and engage in comprehensive cooperation with all parties in the international community. However, for the citizens of these island nations, the business opportunities, investments, or benefits that come from China are something that everyone hopes to obtain. Resisting these benefits seems difficult. Moreover, people who seek business cooperation naturally focus on money and should not be restricted by political ideology. Therefore, entrepreneurs in these island nations tend to establish closer cooperation with China, which is also reasonable.Western governments are less directly involved in the business activities of these island nations, and it is not easy to gain recognition and support from the local people. It can be foreseen that in the future, the “Blue Pacific Partnership” will still be a circle of friends contested by the US and China, and the situation will be unpredictable. Perhaps Western governments should also consider strengthening their soft power development in other societies and building the recognition and support of the people in civil society.