Chinese companies and domestic politics

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THE row between the national government and the Malaita Provincial Government (MPG) has degenerated to a level that is politically unhealthy and could have an adverse impact on infrastructure developments on Malaita.

There is enough blame to go around on both sides. But there is a need to resolve it promptly before it infects the entire country.

At face value, this is a dispute over the Solomon Island Government’s decision to sever diplomatic relation with Taiwan and recognize the People’s Republic of China.

The MPG has been adamant about its opposition to the China relationship. Other Solomon Islanders have also expressed concern about the relationship. This is the most widely debated diplomatic relationship.

However, many acknowledge that international relation is a prerogative of the national Government and have therefore moved on, even if they are still concerned about the China relationship.

The MPG has refused to do that and has written its anti-China crusade into the Auki Communique. This has since become an issue of tension between the MPG and the national Government.   

The most recent blow-up is over allegations that the tender for the construction of the Fiu Bridge in Central Kwara’ae has been awarded to the China Harbour Engineering Company (CHEC) and assistance for Premier Daniel Suidani’s medical treatment.

The tension between the MPG and the national government manifests itself at three levels with intersecting issues.

First, there is a genuine opposition to the diplomatic relation with China. The MPG, like individual citizens, have the right to express their concerns, which they did.

The anti-China sentiment is fueled in part by Solomon Islanders’ negative perception of China.

This is influenced by their encounters with Chinese shop owners, logging companies, Chinese goods, etc.

It is also influenced by a sentimental connection to Taiwan after 36 years of diplomatic relation.

Furthermore, there are the rhetoric associated with the geo-political competition engendered by China’s increasing influence.

Second, the tension between MPG and the national government is a classic example of an appropriation of international relations to frame and express domestic politics.

It is therefore more about domestic politics and the relationship between the national and provincial governments, than it is about China, Taiwan, U.S., Australia, etc.

Those countries have become pawns in Solomon Islands domestic politics.

At the same time, Taiwan – and much less explicitly the U.S. – are exploiting this rift to promote their agendas.

Here, domestic and international politics intersect, which is not uncommon, but this case could be diabolical for everyone.

Third, the tension is a result of personal differences that have histories beyond the diplomatic relation with China. These include dismissals and connections to past and future elections.

The MPG refuses to accept the China Harbour Engineering Company (CHEC) for the Fiu Bridge project, which will affect Malaita people’s access to quality infrastructure.

The project could be awarded to another contractor, but that could delay it, or perhaps no other contractor wants it.

CHEC has previously had contracts in Solomon Islands, including the Transport Sector Flood Recovery Project on Guadalcanal.

In fact, Chinese SOEs have, in recent years, been successful in bidding for infrastructure projects in Solomon Islands.

This includes China Civil Engineering Construction Corporation (CCECC) contract to build the SINU Panatina complex and the proposed Moga Bridge in Northeast Guadalcanal.

Perhaps Chinese SOEs are successful because they are bigger and can outbid and undercut other contractors.

In the future, they will probably dominate the construction market.

Or perhaps it’s because the value of the contracts are comparatively small. Other companies are therefore not interested.

For example, the Fiu Bridge project is less than US$10 million and the SINU complex is about US$12 million.

Maybe the Chinese companies are bigger and therefore can absorb the cost and still make money.

Chinese SOEs have been in Solomon Islands prior to 2019 and have helped grease the switch in diplomatic relations.

This is not unusual. We have seen similar practices elsewhere.

For example, On 3 September 2019, the Guadalcanal Provincial Government Executive met with Yao Ming, the Chinese Chargé  D’affaire to Papua New Guinea, Solomon Islands and Vanuatu.

The meeting was part of Beijing’s attempts to persuade provincial governments about the potential benefits in switching diplomatic relation.

The Chinese delegation included representatives of China Railway International Group Co. Ltd., CHEC PNG Ltd. and two representatives of subsidiary companies.

This is a complex saga with multiple layers, issues and characters. 

In trying to make sense of it, it is important to go beyond the exchanges between the MPG and the national Government and be immersed with the nuances of the stories.

This cocktail of personal differences, domestic politics, international relation, and Chinese companies could leave Solomon Islands with a nasty long-term hangover.