A Chinese firm may or may not be leasing one of the Solomon Islands
Oct 24th 2019WELLINGTONHEADLINE-GRABBING deals in which Chinese firms promise to build impressive infrastructure in some neglected corner of the world have a habit of unravelling—but usually not so quickly. Last month a local official in the Solomon Islands signed an agreement with the China Sam Enterprise Group, a Chinese conglomerate. It involved a 75-year lease for Tulagi, a small island that was the capital of the Solomon Islands in colonial times, along with the construction of an oil and gas terminal, a fishing harbour and a “special economic zone”. But after a headline in the New York Times declared this week, “China Is Leasing an Entire Pacific Island”, frantic back-pedalling ensued. The official who signed the agreement, Stanley Maniteva, appeared to disown it: “Leasing Tulagi will not be possible…Nothing will eventuate.”China Sam is not the only Chinese company hoping to take advantage of the national government’s decision last month to scrap diplomatic relations with Taiwan and establish them with China instead. Executives from the China Civil Engineering Construction Corporation, a big investor in neighbouring Vanuatu, lobbied for the change with an offer of $500,000 in loans and grants. China Railway International has promised to lend $825m to help resuscitate a defunct gold mine. The Chinese government says it will build a sports stadium and provide the cash to repay $1.2m owed to Taiwan. China even offered to make up for the donations Taiwan will no longer be giving to the Rural Constituency Development Fund, which MPs in the Solomons use to pay for pet projects in their constituencies.Choose us for news analysis that respects your time and intelligenceSubscribe to The EconomistWe filter out the noise of the daily news cycle and analyse the trends that matterWe give you rigorous, deeply researched and fact-checked journalism. That’s why Americans named us their most trusted news source in 2017Available wherever you are—in print, digital and, uniquely, in audio, fully narrated by professional broadcastersThis website adheres to all nine of NewsGuard‘s standards of credibility and transparency.ORContinue reading this articleRegister with an email address