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China comes calling in debts of developing nations

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The Niue coastline and the Pacific Ocean at the Matavai Resort in Niue

Developing nations, including those in the Pacific, will pay China $A34 billion this year as Beijing comes calling for repayments on project funding.

China is now “the world’s largest single destination for developing country debt payments” and outstripping the whole of the West, says a new report shows from Australian think tank The Lowy Institute.

Under its Belt and Road Initiative, China has rapidly increased investments in infrastructure since 2013, partnering with dozens of nations primarily in the developed world.

In more recent years Beijing has changed tack, providing a heavier portion of grants – which do not need to be repaid – into its mix of development assistance.

However, with standard lending terms including the delay of payments for several years before a maturation of loans at 15-20 years, it appears crunch time has arrived for repayments.

“China’s earlier lending boom, combined with the structure of its loans, made a surge in debt servicing costs inevitable,” report author Riley Duke said.

“Because China’s Belt and Road lending spree peaked in the mid-2010s, those grace periods began expiring in the early 2020s. It was always likely to be a crunch period for developing country repayments to China.”

Mr Duke says some of the world’s poorest people are likely to bear the brunt.

“The high debt burden facing developing countries will hamper poverty reduction and slow development progress while stoking economic and political instability risks,” he said.

The analysis is incomplete, given data is only available for 54 of 120 developing countries and China does not routinely disclose funding.

Mr Duke says this means his figure of $US22 billion ($A34 billion) to be repaid in 2025 to China and its many state-controlled lending arms is likely an understatement.

It is also unclear whether China would defer debt repayments as it did during the COVID-19 pandemic, when it joined with G20 nations to provide relief.

That move was helpful at the time, according to Mr Duke, but the effect was to mount costs into a heightening of the current repayment spike.

Several countries across the Pacific, which have benefited from Chinese investment in infrastructure, are likely to be among the countries affected.

The report comes ahead of a significant summit between China and the Pacific in Xiamen, beginning on Wednesday when Foreign Minister Wang Yi hosts representatives of 11 nations.

Kiribati Prime Minister Taneti Maamau and Niue Premier Dalton Tagelagi will join with the foreign ministers of Tonga, Nauru, Micronesia, Solomon Islands, Vanuatu, Papua New Guinea and Cook Islands, and representatives from Fiji and Samoa for the two-day meeting.

“There will be an in-depth exchange of views on interactions and cooperation between China and Pacific island countries (PICs) in all aspects and international and regional issues of mutual interest,” China foreign ministry spokesperson Mao Ning said.

“China highly values its ties with PICs and hopes that this meeting will help drive the implementation of the important common understandings reached between leaders of the two sides, enhance solidarity and coordination, unite efforts for development and prosperity, and galvanize an even closer community with a shared future.”

The 11 nations attending the summit make up the entire Pacific Islands Forum membership, excepting the three countries with diplomatic ties to Taiwan, the two France-aligned nations, Australia and New Zealand.

Written by: Ben McKay © Australian Associated Press

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New Zealand simplifies visa rules for Pacific

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Travellers from Pacific Island nations will find it easier to travel in New Zealand after changes to visa rules.

Movement from much of the Pacific to either Australia and New Zealand is currently expensive and onerous, with most citizens of most countries required to apply for visitor visas, and wait for their approval.

On Friday, NZ announced a pair of changes that will make travel easier: waiving visa requirements for nationals of Pacific Islands Forum member countries who already have Australian visas, and extension of visitor visas from 12 to 24 months.

“We deeply value our Pacific relationships. Being able to visit New Zealand to connect with family and friends is an important part of this,” Foreign Minister Winston Peters said.

Mr Peters – on his 80th birthday – revealed the changes while on a visit to Tonga in a joint announcement with immigration minister Erica Stanford.

The changes fall short of the holy grail for Pacific Islanders – visa-free travel of the sort that Australians and New Zealanders benefit from when they travel through much of the developed world.

However, this remains a possibility.

The NZ government is currently reviewing its visa settings with the Pacific, which could see more significant changes to visa settings in the period ahead.

“Downstream is it likely to happen? Sometime from now, possibly,” Mr Peters told reporters in Nuku’alofa.

“In this computerised age, we are finding it extraordinarily difficult … to get this part of area of our operations right, immigration visas and all those things.”

The lack of visa-waiver travel has been decried by several nations as unfair, especially given Australian and Kiwi travellers are often afforded visa-free or visa-on-arrival entry to many Pacific Islands – though they don’t offer the same in return.

In 2024, Australia instituted a new Pacific Engagement Visa, which grants permanent residency to 3000 applicants across the region through a ballot process each year.

Australian Prime Minister Anthony Albanese was asked about the prospect of visa-free travel for Pacific nations last year at the Pacific Islands Forum leaders summit, saying leaders hadn’t asked him for it.

“People haven’t raised visa arrangements, and we don’t have any plans to change the existing arrangements,” he said.

NZ’s changes come into effect from July and apply to nationals of 12 countries: Federated States of Micronesia, Fiji, Kiribati, Marshall Islands, Nauru, Palau, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu, and Vanuatu.

People from the Cook Islands, Niue and Tokelau are already New Zealand citizens who do not need visas, while those from New Caledonia and French Polynesia are French citizens and already eligible for visa-free travel.

Written by: Ben McKay © AAP 2025

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MSG Secretariat Condemns Japan’s Discharge of ALPS Water

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Japan has started the releasing of treated nuclear waste water (ALPS) into the Pacific Ocean as of 24th August, sparking different reactions from Asian and Pacific Island Countries.

Scientists including the International Atomic Energy Agency (IAEA) have backed Japan’s plan to release treated nuclear water but China anounced it will not be importing Japanese sea food.

In the Pacific, Secretariat of the Melanesian Spearhead Group (MSG) said the health of the Pacific Ocean determines the survival of Pacific Islanders.

MSG Laumo ALPS Water
MSG, Director General, Leonard Louma

A statement released by MSG, Director General, Leonard Louma, states that the best proof that ALPS (treated water from Fukushima) is safe, is to discharge it into Japan’s own internal waterways and that no amount of justification, scientific or otherwise, will suffice.

“We in the Pacific are too well aware of the fallacy of the safety of nuclear activities, “said Louma.

The treated nuclear waste from Fukushima Nuclear Plant will be released into the Pacific Ocean over the next 30 years after the UN Nuclear watchdog approved the plan by the Japanese Government.

The discharge is seen as a key step in decommissioning the Fukushima Daiichi plant after it was destroyed by a tsunami in 2011.

The plant operator Tokyo Electric Power (Tepco) began releasing treated nuclear water at in August through an underground tunnel.

Back home, Papua New Guinea, Prime Minister James Marape had commented that it’s best the treated water is released in a controlled manner.

James Marape ALPS water
PNG Prime Minister James Marape

“For us in the Pacific our position has always been the same, a Nuclear free Pacific. But I also note that International Atomic Energy Agency (IAEA) has been working with the government of Japan to rigorously review the safety for waste water for release,” said Marape.

However MSG is of the view that, after reading the IAEA Assessment Report before the discharge, had given no comfort at all.

“The “qualified” words and “diplomatic” construction of language used in the Assessment Report suggests to us that even the IAEA is not sure of the safety of the discharge of the ALPS water into the Pacific Ocean,” said Louma.

Louma is concerned on how would one interprets the use of “consistent with” safety standards, the effects will be “negligible”, and “additional review” or checks will be done again when discharge takes place.

“So please forgive us if we are sceptical of this safety narrative that you have gone overdrive to have us believe that the ALPS water is safe. Excuse us if we appear naïve when we say science can be wrong. Our experience tells us to be cautious,” Louma added.

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