A landmark agreement to "transform" the relationship between Australia and Vanuatu remains unsigned, after Prime Minister Anthony Albanese held talks with his counterpart in the Pacific Island nation.
The fate of the Nakamal Agreement between Australia and Vanuatu now hangs in the balance, with Vanuatu's Prime Minister Jotham Napat revealing at a joint press conference on Tuesday in Port Vila that "wording" around "critical infrastructure" in the agreement was holding back his country's signature.
Last month, Defence Minister Richard Marles, Foreign Minister Penny Wong and Pacific Minister Pat Conroy all travelled to Vanuatu and trooped to the top of a volcano on the island of Tanna in a spectacular ceremony to initial the agreement, marking what was thought to be the conclusion of negotiations.
Under the agreement, the federal government is expected to pour about $500 million into Vanuatu over a decade to help fund some of its key climate, security and economic priorities — while entrenching Australia's position as the Pacific nation's main security and development partner.
At the time, Vanuatu's Prime Minister Jotham Napat has heaped praise on the pact, and declared in the wake of the volcano ceremony that Mr Albanese would travel to Vanuatu "soon" or within "weeks" to jointly sign the agreement with him.
But he has since faced questions internally in Vanuatu, with Mr Napat revealing on Tuesday his coalition partners "feel it requires more discussions, particularly on some of the specific wordings in the document".
At the joint press conference, Mr Albanese said he was "very confident that it will be able to be signed soon".
"It's important that processes be respected, and I respect the prime minister's processes," he said.
"We have our own, respectively. This is an agreement that will also, importantly, respect sovereignty of Vanuatu, but one as well that respects sovereignty of Australia.
"[And] this is in the interests of both of our nations and is a very positive agreement going forward."
Mr Albanese is winging his way to Vanuatu ahead of the Pacific Islands Forum leaders meeting in Solomon Islands.
Infrastructure concern as China circles
Earlier this week, a Vanuatu government representative told the ABC discussions were ongoing and that it was still possible the signing ceremony would go ahead — although they said the situation was "uncertain".
Vanuatu government sources this week told the ABC there was some "concern" in Mr Napat's coalition government around clauses in the agreement which might "limit engagement with other countries, especially [in] infrastructure agreements", which Mr Napat confirmed on Tuesday.
Vanuatu has borrowed heavily from China to fund key infrastructure projects, while Beijing's police teams in the country have also been playing an increasingly visible role on the ground.
One diplomatic source told the ABC that China had been pressing some of Mr Napat's ministers not to sign the agreement, although they said it wasn't clear whether Beijing's diplomats in the country had mounted a concerted campaign against the pact.
A spokesperson for the Prime Minister Anthony Albanese declined to comment on the negotiations ahead of his departure to Vanuatu.
In a statement released shortly before his trip, Mr Albanese said he would meet Mr Napat for talks, as well as calling on Vanuatu's President Nikenike Vurobaravu during his trip to Port Vila.
Diplomatic blow
Adjunct Associate Professor at Griffith Asia Institute Tess Newton Cain, said that Mr Napat and his advisers "had been clear for some time that they are keen to maintain the maximum amount of flexibility in terms of which partners they work with in support of development needs including infrastructure".
She also said the final text of the agreement "would be closely scrutinised by Napat's opponents and in the Vanuatu context" and "…any apparent ceding of sovereignty could leave him open to attack from the opposition or even others within his government".
It's not the first time the government has struggled to land an agreement with the Pacific island nation: Australia and Vanuatu started negotiations on the Nakamal Agreement after Vanuatu effectively buried an earlier 2022 security pact signed by Mr Napat's predecessor Ishmael Kalsakau.
Dr Newton Cain said that if the two prime ministers didn't sign the pact, Australia "would be at pains to portray this as part of a mutually beneficial process that is ongoing rather than a failure".
"But I expect it will rankle given all the twists and turns there have already been," she said.
Mihai Sora from the Lowy Institute said there was "no question that Australia is the more significant partner for Vanuatu's security and development, but this is about politics".
"Australia wants China out of policing and critical infrastructure in the Pacific. But it's easy to imagine individual MPs in Port Vila somewhat protective of relations with China, which they may perceive to be of personal benefit to them," he said.
"Mr Napat will be reluctant to sign a deal with Albanese if it costs him the backing of key domestic political supporters."
After his brief visit to Vanuatu, Mr Albanese will fly to Solomon Islands, joining Pacific leaders in the capital Honiara for two days of meetings.
On Wednesday, Pacific leaders are expected to endorse a treaty to establish a new climate finance fund called the Pacific Resilience Facility as well as a declaration for an "Ocean of Peace" championed by Fiji's Prime Minister Sitiveni Rabuka.
