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Vanuatu's Prime Minister declined to sign a major security and economic agreement with Australia Tuesday, citing concerns that critical infrastructure provisions could limit the Pacific nation's ability to cooperate with other countries, including China.
Prime Minister Jotham Napat said the proposed Nakamal Agreement requires further discussion among his coalition partners before finalization, specifically regarding language about critical infrastructure that could restrict Vanuatu's sovereignty in securing foreign investment and development funding.
"Some of my Ministers and my MPs, they feel that it requires more discussions to, particularly on some of the specific wordings in the agreement," Napat said during a joint press conference with Australian Prime Minister Anthony Albanese in Port Vila.
When pressed about whether the provisions could limit Vanuatu's ability to get funding from other countries for critical infrastructure, Napat confirmed "Yes."
The diplomatic setback occurred during Albanese's first official visit to Vanuatu as Prime Minister, only the second such visit by an Australian leader since 2019. The two leaders are scheduled to travel Wednesday to the Pacific Islands Forum in the Solomon Islands, where regional security and climate issues will dominate discussions.
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Agreement Details and Delays
The Nakamal Agreement, named after traditional Vanuatu meeting places, represents Australia's effort to deepen security and economic ties with the strategic Pacific nation located 1,750 kilometers northeast of Australia. The treaty-level agreement includes provisions for economic development, climate change adaptation and regional security cooperation.
Albanese expressed confidence the agreement would be finalized soon despite Tuesday's delay, emphasizing respect for Vanuatu's democratic processes.
"There is agreement on the principles that have been agreed and initialled in the Nakamal Agreement. It's a matter of processes going through," Albanese said. "I respect the processes that Prime Minister Napat needs to go through."
The Australian leader said both governments remain "very confident that the agreement can be reached" and dismissed suggestions the provisions would undermine Vanuatu's sovereignty.
"We don't want to either do or be seen, for anything to occur, that undermines the sovereignty of Vanuatu," Albanese said. "What we are doing in the Pacific though is understanding that on economic issues, on national sovereignty issues, on security issues, all of this, the Pacific family have an interest in looking after each other."
Economic Partnership Framework
The delayed agreement accompanies a significant Australian investment package for Vanuatu, including support for earthquake recovery following devastating December 2024 disasters. Australia has committed approximately $500 million for economic development, infrastructure investment and workforce training programs.
Albanese outlined key priorities for the economic partnership, including "upskilling of the workforce here" and "infrastructure investment" to promote regional development.
The partnership builds on existing cooperation through the Pacific Labour Mobility Scheme, which currently supports over 6,000 Ni-Vanuatu workers in Australia. These workers provide "deeply valued contributions to both of our economies," according to Albanese.
Historical Relationship Context
Tuesday's discussions occurred against the backdrop of 45 years of diplomatic relations between Australia and Vanuatu since independence in 1980. Albanese, making his third visit to Vanuatu as an individual and first as Prime Minister, traced his personal connection to the nation back to 1986 when he visited as a tourist.
"Australia and Vanuatu are family with connections built over generations grounded in our close Melanesian, South Sea Islander and First Nation's ties," Albanese said. "To be considered family is not only a deep privilege, it also carries with it a great responsibility."
Napat welcomed Australia's commitment to the bilateral relationship, noting high-level visits "demonstrate a strong and genuine efforts by both governments to build sustainable, trustworthy and long term relationship."
Regional Security Implications
The agreement delay highlights broader strategic competition in the Pacific region, where Australia seeks to maintain influence while China expands economic and security partnerships with island nations. Vanuatu's concerns about critical infrastructure provisions reflect sensitivity about maintaining flexibility in foreign partnerships.
The proposed agreement addresses multiple security challenges facing Pacific nations, including transnational crime, cybersecurity threats and climate-related disasters. Albanese emphasized these challenges require regional cooperation since they "don't recognise national boundaries."
Australia's Pacific Policing Initiative, announced at the 2024 Pacific Islands Forum, aims to enhance law enforcement capacity and interoperability across the region. The program focuses on combating transnational crime and improving cybersecurity capabilities.
Climate Change Focus
Both leaders identified climate change as a priority area for cooperation, reflecting Vanuatu's vulnerability to rising sea levels and extreme weather events. The proposed agreement includes provisions for climate adaptation and building resilience against environmental challenges.
Vanuatu faces particular risks from cyclones, earthquakes and volcanic activity, requiring sustained international support for disaster preparedness and recovery. Australia's assistance following December 2024 earthquakes demonstrated the partnership's crisis response capabilities.
"We will be with you in good times and in bad, because that's what happens with families," Albanese told Napat, referencing Australia's disaster relief support.
Forum Preparations
The bilateral discussions serve as preparation for Wednesday's Pacific Islands Forum meeting in Honiara, where regional leaders will address security concerns, climate challenges and economic development priorities.
Albanese said forum discussions would cover "security issues, to discuss climate change and the challenge that it represents, but also the opportunity that it represents as well."
The forum provides a platform for Pacific nations to coordinate responses to shared challenges while maintaining individual sovereignty over foreign policy decisions. Australia seeks to lead regional initiatives while respecting island nations' autonomy in choosing development partners.
Political Dynamics
Napat's coalition government faces internal discussions about the agreement terms, highlighting democratic processes within Vanuatu's political system. The Prime Minister indicated his government welcomes Australia's strategic partnership while ensuring adequate consultation with coalition partners.
"The political parties or the coalition members within the party within the government that I'm leading, they welcome Australia's strategic partnership and particularly with the Nakamal Agreement," Napat said.
Australian officials expressed understanding of Vanuatu's need for thorough domestic consultation before finalizing international agreements. The delay reflects normal diplomatic processes rather than fundamental disagreements about cooperation principles.
Next Steps
Both governments indicated work would continue on finalizing agreement language that addresses Vanuatu's sovereignty concerns while achieving Australia's regional security objectives. Officials from both countries will continue negotiations following the Pacific Islands Forum meeting.
The outcome will influence broader Pacific regional dynamics as other island nations observe how Australia balances security partnerships with respect for sovereignty. Success could provide a template for similar agreements throughout the region, while failure might encourage other nations to pursue more diverse foreign partnerships.
Tourism links between the countries continue expanding, with large numbers of Australians visiting Vanuatu annually, providing additional foundation for the bilateral relationship beyond government agreements.
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