Vanuatu PM: Cabinet approves China pact, says both powers undermining nation

The prime minister of Vanuatu says his cabinet has given a green light to a new "strategic cooperation" pact with China and suggested that both Beijing and Canberra are "undermining" his country as they jostle for strategic supremacy.

Jotham Napat has also confirmed that Vanuatu has approved a stripped-back version of the landmark Nakamal Agreement with Australia, saying his country was now "ready" to sign the deal with Canberra.

There has been a subterranean arm wrestle between Australia and China in Vanuatu, with Australian officials increasingly convinced that Beijing has used its influence to try and sink the Nakamal Agreement while shoring up its own pact, the Namele Agreement.

China's embassy in Vanuatu has previously said its cooperation with the country focuses on "infrastructure and capacity building" and has rejected suggestions the Namele Agreement contains security elements. The embassy did not respond to the ABC's questions about the latest claims.

Mr Napat showed occasional flashes of frustration with both countries while fielding questions about the agreements in Vanuatu's parliament, suggesting Australia and China were too preoccupied with gaining strategic leverage.

"Here, now, we stand up to say: we are friends to all, and enemies to none.

"We will not want to favour one party over another."

Deal details remain scarce

Mr Napat said Vanuatu's Council of Ministers had now approved the Namele Agreement with China, but gave little information about what it would involve, simply insisting it had "nothing to do with security" and was focused on "strategic cooperation."

The prime minister also confirmed Vanuatu had also given the green light to a diluted version of the Nakamal Agreement, as reported by the ABC last week.

Mr Napat reiterated that the "first version" of the Nakamal agreement would have forced Vanuatu to "ask advice" or "seek approval" from Australia on critical infrastructure — a reference to Canberra's efforts to lock Chinese companies from sensitive sites.

"This already undermined our sovereignty. We were not satisfied with words like this, so we took time to renegotiate until everyone was happy" he told parliament.

The prime minister also played down the security elements in the Nakamal Agreement saying there was only "one clause" in the pact that was "related to security".

But the ABC has been told that the agreement does assert that Australia is Vanuatu's primary policing partner, as well as reaffirming that Vanuatu's critical infrastructure will remain free from militarisation.

Vanuatu's parliament already passed legislation last year designed to reinforce its non-aligned status and which reiterated that its critical infrastructure cannot be used for military purposes.

Mr Napat suggested the Nakamal Agreement would be inked soon, saying "we can proceed and sign" now it had been given a green light by Vanuatu's cabinet.

A spokesperson for Foreign Minister Penny Wong said Australia remained "committed to finalising the Nakamal Agreement" but said the agreement was "still proceeding through our domestic processes".

"We approach this as equal partners, with respect for Vanuatu's sovereignty, so we have been taking all the time required for the agreement to be finalised," they said.

"We are confident about the future of our relationship with Vanuatu."