The Pacific Islands face intensifying strategic competition across 25,000 islands spread over 28 million square kilometres of ocean. Small Pacific Island governments must deliver accountable governance across extreme distances, enforce laws over exclusive economic zones covering more than 10% of the world's ocean surface, and manage resource decisions that could be worth billions — all while external actors seek influence through aid, infrastructure, resource and security partnerships. Democratic governance provides the necessary institutional capacity and resilience for independent decision-making and resistance to coercion from any source, thereby enabling Pacific nations to benefit from democratic partnerships on their own terms.
This analysis identifies five priority areas where democratic partners and Pacific nations can work together:
- digital infrastructure and information security
- governance capacity and institutional effectiveness
- civil society as a partner in service delivery
- law enforcement and maritime governance
- resilience governance.
Progress in these areas strengthens Pacific sovereignty while giving partners what they ultimately want — stable, capable states.
Recent US policy shifts have created credibility gaps even as Washington has sought to deepen its regional presence. The 2025 closure of USAID eliminated 100% of country programming in Papua New Guinea (PNG), Vanuatu, Palau, Fiji and the Solomon Islands. China has therefore moved to position itself as the more reliable partner. Washington has since begun reinvesting through a narrower model: law enforcement, maritime security, connectivity and commercial engagement. This analysis’ recommendations focus on how governance capacity can make that reinvestment durable.
The analysis concludes with recommendations for key principles to inform durable Pacific Island engagement by democratic partners:
- Prioritise partnerships with Pacific-led multilateral fora.
- Pursue reliable forms of long-term commitments.
- Share the burden among allies and partners.
- Codify durable frameworks for engagement that transcend electoral cycles.
- Sustain high-level engagement and financial access beyond crisis response.
- Support governance efforts that strengthen Pacific sovereignty.
Introduction
Strong public institutions allow Pacific nations to evaluate external offers on their own terms, turning competition among partners into expanded choice. Pacific leaders assert their agency clearly. The Blue Pacific Ocean of Peace Declaration, endorsed by leaders of Pacific Island nations at the 54th Pacific Island Forum in September 2025, reaffirmed Forum Members' “national sovereign right to exercise autonomy and self-determination over their governance, resources and development pathways,” while naming “external coercion” and “undue influence” among the threats the region guards against. This principle guides regional initiatives including the 2050 Strategy for the Blue Pacific Continent, and the Pacific Resilience Facility.
The timing matters. The year 2025 brought the sharpest disruption to US engagement in the Pacific in decades, and 2026 has marked the beginnings of an alternative, narrower in scope and different in kind. Whether that alternative holds depends less on the volume of new commitments than on whether Pacific institutions have the capacity to absorb, regulate and negotiate around them. This analysis argues that governance capacity is not one priority among several but the condition on which the others depend.
This analysis focuses on the Pacific Island Countries, the island members of the Pacific Islands Forum.1 It uses ‘partners’ to describe democratic states engaging the region and ‘external actors’ to describe the full range of states seeking influence, including those whose engagement the region approaches with more caution.
Governance capacity is not one priority among several but the condition on which the others depend.
Pacific democracy and self-resilience
Democracy is the prevailing governing system across the Pacific Islands, with imported models adapted to local realities. Many states blend Westminster structures with customary leadership, including Fiji, Samoa and Vanuatu. Presidential systems operate under Compacts of Free Association in the Federated States of Micronesia, Palau and the Marshall Islands. PNG maintains democratic governance across more than 800 languages. Despite this diversity, and despite a turbulent democratic history in some states such as Fiji, democratic practice across the region as a whole has remained broadly stable, characterised by regular elections, peaceful transitions and sustained civic participation. Pacific democracy is not merely stable; it is moving against the global tide.
While Freedom House recorded the twentieth consecutive year of global democratic decline in 2025, Fiji became one of only three countries worldwide upgraded from Partly Free to Free, reflecting a peaceful rotation of power, eased restrictions on civil liberties, and gains in judicial independence and the rule of law. The longer arc is just as striking. Of nine countries globally that rose from Partly Free to Free over the past two decades and held that status, three (Fiji, Solomon Islands and Tonga) are Pacific Island Countries. Electoral turnout routinely exceeds 70% in national elections across the region.
Pacific democracy is not merely stable; it is moving against the global tide.
Geography compounds the challenge. Sixteen small island states are spread across one of the most dispersed territories on Earth: Tuvalu's 11,000 citizens living across nine islands spanning 900 km; the Solomon Islands' 850,000 population is spread across 992 islands, reefs and atolls; and the Marshall Islands' 42,000 people occupying 29 atolls across 1.9 million square kilometres. These conditions make service delivery, election administration and rule of law enforcement difficult for central governments operating across distance, language and infrastructure constraints. Governance challenges stem less from political will than from structural and logistical realities.
Pacific agency operates through and is enhanced by regional initiatives. The 2050 Strategy for the Blue Pacific Continent, the Forum's long-term development blueprint adopted in 2022, defines shared priorities: climate adaptation, economic sovereignty, connectivity, maritime security and democratic governance respecting customary systems. The Pacific Resilience Facility, established in 2025 as the region's first Pacific-led and Pacific-owned international financial institution, secured US$162 million in pledges toward an initial goal of US$500 million, addressing what leaders describe as slow and inaccessible climate finance. At the signing of the Ocean of Peace Declaration in late 2025, Pacific Islands Forum Chair and Solomon Islands Prime Minister Jeremiah Manele called it “a call for the Pacific to control its destiny.”
US engagement in and policy toward the Pacific
Pacific-led frameworks for engagement with the United States exist and are working. What has become unreliable is the partner side of the relationship. US congressional support for US engagement in the Pacific remains strong and bipartisan, but a gap between legislative intent and executive follow-through, recurring across administrations and sharpening since 2025, has weakened credibility.
Legislation like the Pacific Partnership Act and BLUE Pacific Act, which would mandate a quadrennial Pacific strategy and sustained coordination mechanisms, signals commitment that transcends individual administrations. So do the renewed Compacts of Free Association with the Federated States of Micronesia, the Republic of the Marshall Islands and Palau; the treaty arrangements under which the United States provides US$7.1 billion in economic assistance over 20 years in exchange for exclusive defence access across the North Pacific. The Millennium Challenge Corporation (MCC), a US foreign assistance agency that ties development funding to governance performance, has invested or committed nearly US$115 million over the past two decades across the Pacific and recently deepened that footprint — signing a US$12 million agreement with Fiji, which is eligible to develop a full compact, and approving Tonga for a threshold program focused on digital technology and energy.
The 2025 disruption to US engagement was abrupt and wide-ranging. The closure of USAID eliminated 100% of USAID country programming in PNG, Vanuatu, Palau, Fiji and the Solomon Islands. Some programs, even in Compact states, were affected; however, core Compact funding, administered through the Department of the Interior, was largely insulated from the cuts. Terminated grants included the US$2.5 million Ambassador's Self-Help Small Grants Program and support for the Pacific Islands Emergency Management Alliance. Climate programs ended despite Pacific leaders identifying adaptation as an existential priority, while election support, civil society programs and governance initiatives were also curtailed. This shift toward ‘trade over aid’, coupled with new tariffs, has strained relationships. Responding to the tariffs, PNG Prime Minister James Marape stated the country would redirect goods to markets conducting trade "with respect, honour, and fairness."
These gaps reflect the structure of US engagement, where reliance on annual appropriations and executive discretion leaves commitments exposed to policy shifts. Partners with multi-year frameworks, including Australia, New Zealand, France and Japan, have sustained engagement more consistently, though each has its own friction points with the region, from climate policy to the ALPS water discharge to New Caledonia's political future.
Partners with multi-year frameworks, including Australia, New Zealand, France and Japan, have sustained engagement more consistently, though each has its own friction points with the region.
China has positioned itself as a predictable partner to governments despite considerable anti-Chinese sentiment in the region. The positioning rests on a long record: between 2008 and 2024, China provided billions of dollars in infrastructure financing, prioritising visible, large-scale projects, including sports stadiums, deep-sea ports, roads and government buildings, that met infrastructure demand while other partners focused on technical assistance.
Recent engagement reinforces it: Shanghai-Nadi direct flights; a US$300 million infrastructure package in Fiji; and the third China-Pacific Foreign Ministers Meeting in Xiamen, where more than 100 climate projects were announced. The message was explicit; China's ambassador to PNG Yang Xiaoguang characterised US tariffs as “economic bullying” while describing China as PNG's “most reliable partner.” The well-documented risks of China's investment model, including debt sustainability, surveillance-capable systems and illegal fishing, have not blunted the appeal so long as US inconsistency lends the pitch credibility. But this narrative is not the whole story. When Pacific leaders capitalised their own Resilience Facility, the United States pledged US$20 million, and Australia A$100 million; China pledged $500,000.
At the same time, Washington's retreat from development assistance has not meant disengagement. The administration has pivoted toward defence, law enforcement and commercial ties. The US Department of State and Indo-Pacific Command hosted a regional investment summit in Honolulu in February 2026, where it announced support for strengthening law enforcement capabilities, combating illegal fishing and expanding coast guard cooperation, and committed new funding to trusted undersea cable infrastructure across the region. The question is whether this narrower engagement model can substitute for the institutional programming it replaced.
Australia and New Zealand demonstrate alternative models through decades of sustained engagement. Australia is the Pacific's largest development partner by a wide margin, providing 43% of all official development finance to the region, more than four times New Zealand's contribution, which is the next largest. That dominance has grown as other Western donors have retreated. Australia’s Pacific Patrol Boat Program has provided vessels to 12 Pacific nations since 1987. The 2025 Australia-PNG Mutual Defence Treaty and the 2026 New Zealand-Cook Islands defence and security declaration show democratic partners deepening institutionalised commitments.
Democratic governance as the foundation for partnership
The gap between what partners announce and what they sustain is what governance capacity is meant to close. Democratic governance enables Pacific sovereignty, resilience and more effective engagement with external partners. Across the region, governments must deliver accountable governance across vast distances, with limited infrastructure and small administrations, making institutional strengthening a practical requirement rather than a normative aspiration. This understanding is shared by Pacific voices themselves: a May 2026 CSIS report compiling insights from Young Pacific Leaders emphasises that security for the region encompasses cybercrime, drug trafficking, health systems and employment, far more than defence alone.
Governments must deliver accountable governance across vast distances, with limited infrastructure and small administrations, making institutional strengthening a practical requirement rather than a normative aspiration.
Digital infrastructure and information security
Digital infrastructure is foundational to democratic governance in a region defined by distance, and the scale of the challenge is measurable. UNESCO's 2025 assessment of five Pacific nations found internet usage exceeds 40% in some urban centres while remaining below 20% in rural provinces; in Palau, roughly 42% of the population lacks internet access. Connectivity is nonetheless improving rapidly: every Pacific Island Country was expected to be linked by submarine cable by the end of 2025, and satellite services have extended access to remote areas, restoring Tonga's connectivity after the 2022 volcanic eruption severed its cable. Field research finds the gains uneven, with Fiji, Tonga and Samoa leading in digital readiness while donor-funded infrastructure often arrives without maintenance support or local capacity development. Pacific governments have set their own agenda through the 2023 Lagatoi Declaration on Digital Transformation, signed by thirteen ICT ministers. These gaps constrain service delivery and democratic engagement, making connectivity investments foundational rather than supplementary.
Trusted telecommunications underpin government operations and citizen services across vast oceans. The East Micronesia Cable illustrates what is at stake. The project stalled in 2021 when the Federated States of Micronesia, Kiribati and Nauru reconsidered a contract involving a Chinese firm following security warnings; it resumed in 2023 under joint grant funding of approximately US$95 million from the United States, Australia and Japan, and completed its final landing in August 2025. The cable connects more than 100,000 people and is the first submarine link ever to reach Kosrae, Tarawa and Nauru.
Pacific Connect, a multilateral initiative coordinating undersea cable investments across the region, extends this model: the United States and partners have committed more than US$230 million to trusted undersea cables serving 13 Pacific Islands countries and territories, with branching units announced in 2026 to connect Tonga and Samoa. Expanded connectivity, through undersea cables, terrestrial mobile networks and satellite systems, enables digital government services, economic participation and informed democratic engagement while reducing vulnerability to information manipulation. Whether these systems protect information sovereignty or create exploitable vulnerabilities depends on who builds them and who maintains them.
Cybersecurity capacity protects government systems and critical infrastructure from external interference, and the threat is not hypothetical. A 2022 ransomware attack took Vanuatu's entire government offline for over a month, forcing ministries back to pen and paper. In 2024, ransomware crippled Palau's Ministry of Finance in the same month the country renewed its Compact with the United States, an attack President Surangel Whipps Jr. publicly attributed to China. A separate 2024 incident saw Chinese state-backed hackers penetrate the Pacific Islands Forum itself. Australian rapid-response teams have deployed repeatedly across the region, but episodic crisis response is no substitute for resident capacity.
Trusted technology partnerships strengthen Pacific information sovereignty. In February 2026, Palau's national carrier began the Pacific's first nationwide deployment of Open Radio Access Network (Open RAN) technology, which lets operators mix equipment from trusted vendors rather than depending on a single supplier, backed by roughly US$20 million from the United States and its Quad partners. Cybersecurity assistance enables governments to protect election systems, parliamentary networks and citizen services while retaining control over digital infrastructure. Independent media infrastructure further supports informed citizenship and information integrity.
Governance capacity and institutional effectiveness
Information systems are only as good as the institutions that act on them. Public financial management and domestic resource mobilisation enable Pacific governments to reduce aid dependency while improving service delivery. The Japan-funded UNDP Strengthening Legislatures program works across six Pacific nations to improve parliamentary financial oversight and budget analysis. Australia and New Zealand have made electoral administration a parallel signature contribution. For the Solomon Islands' historic 2024 joint elections, Australia delivered a A$25 million package covering logistics, voter registration and training for electoral officials, building on longstanding cooperation with the Solomon Islands Electoral Commission, while New Zealand funded poll-worker training and an elections operations centre, with technical support from its own Electoral Commission.
Technical assistance programs help governments strengthen revenue collection, budget management and transparent expenditure. Anti-corruption frameworks and transparency mechanisms strengthen institutional legitimacy and effectiveness. MCC compact criteria tie development assistance to governance benchmarks including corruption reduction, transparent procurement and regulatory quality.
The seabed minerals question tests whether this capacity translates into real decision-making authority. National Oceanic and Atmospheric Administration (NOAA) deep-sea research provides scientific data for informed seabed minerals decisions without dictating outcomes. In the Cook Islands, NOAA-funded expeditions in 2025 and 2026 mapped deep-sea habitats with priorities set by the Cook Islands Seabed Minerals Authority; local scientists joined the missions, and the data, shared openly with the government, feeds the environmental baseline on which the Cook Islands will decide whether seabed mining proceeds at all.
Civil society as government partner in service industry
Institutional capacity does not automatically reach the outer islands. Pacific governments face a fundamental challenge: small administrative capacity cannot deliver services across extremely dispersed populations. Civil society organisations extend that reach, reframing civil society as a service partner rather than solely a watchdog.
Civil society organisations extend that reach, reframing civil society as a service partner rather than solely a watchdog.
Electoral and political support has been the deepest area of this partnership. From 2019 through 2025, the US Government funded the International Republican Institute (IRI), the International Foundation for Electoral Systems (IFES) and the National Democratic Institute (NDI) through the Consortium for Elections and Political Process Strengthening (CEPPS), to support electoral commissions and civic participation across 12 Pacific nations including support for PNG's 2022 national elections, Bougainville's post-referendum votes and Solomon Islands' 2024 joint elections.2 Political party institutionalisation is a particular opportunity in a region where political crises, including Fiji's coups, have repeatedly followed personality-driven rather than programmatic party systems. Programs also supported Fiji’s newly elected government in its efforts to reinstate elected local government following the country’s 2022 peaceful democratic transition and partnered with Solomon Islands National Council of Women on youth leadership to support local governance in its remote provinces.
Smaller-scale mechanisms have extended this reach further still. US Embassy small grants programs, including the Ambassador's Self-Help Small Grants Program and Public Diplomacy Small Grants, funded dozens of community-level projects across Fiji, Kiribati, Nauru, Tonga and Tuvalu between 2020 and 2025, extending government capacity to outer islands — though the 2025 USAID closure eliminated the Development Assistance Funds underpinning several of these grants. Extending government reach is necessary but not sufficient; states must also be able to enforce the laws that reach implies.
Law enforcement and maritime governance capacity
Professional law enforcement strengthens rule of law and democratic institutions. Pacific governments operate across exclusive economic zones that comprise more than 10% of the world's total ocean surface. PNG alone manages roughly 2.4 million square kilometres with four patrol boats. Capacity to enforce laws impartially protects sovereignty and economic sustainability. Programs emphasising sustained institutional development outperform episodic training. The PNG residential advisor program, run by the US State Department's Bureau of International Narcotics and Law Enforcement Affairs, provides one example.
Illegal, unreported and unregulated (IUU) fishing threatens food security, revenue and democratic authority. Regional bodies, including the Pacific Community and the Forum Fisheries Agency, build capacity to monitor and enforce compliance.These priorities align directly with Washington's March 2026 announcement of US$2.5 million to partner with the Pacific Community on IUU compliance capacity and US$540,000 for automatic identification systems in Tonga and Samoa, creating immediate openings for implementation.
Anti-trafficking and transnational crime capacity matters increasingly as criminal networks target Pacific nations. The 2026 seizure of A$780 million in cocaine in Fijian waters illustrated how transnational crime networks exploit enforcement gaps, overwhelming small governments. Transparent governance frameworks ensure democratic processes, not opaque arrangements, control national assets. Even fully enforced institutions face a threat no amount of capacity-building can out-build: the physical loss of the territory itself.
Resilience governance and natural resource management
Climate adaptation represents the starkest divergence between Pacific priorities and some partner policies. Forum Leaders reaffirmed in 2025 that climate change “remains the single greatest threat to the livelihoods, security, and wellbeing of the peoples of the Pacific.” As Cook Islands Prime Minister Mark Brown told the UN Climate Change Conference in 2024, Pacific nations face climate change as “not a distant threat” but a “present reality,” while international finance asks them “jump hoops and then wait.” Pacific leaders established the Pacific Resilience Facility in response to international climate finance that has proven slow, fragmented, and difficult for small states to access. Meanwhile, the United States has effectively eliminated climate-labelled programming.
Despite policy divergence, practical cooperation remains possible. Disaster risk reduction and emergency management, public health surveillance and infrastructure resilience standards protect lives and investments. The Pacific Public Health Surveillance Network strengthens capacity to manage climate-sensitive diseases like dengue. Technical assistance helps Pacific governments navigate World Bank, Green Climate Fund and Asian Development Bank processes to access international resilience finance. The Pacific Resilience Facility demonstrates Pacific agency in creating financial institutions that serve their own needs.
Partnership principles and recommendations for democratic partners
Together, these five areas enable Pacific nations to build strong partnerships with democratic states while engaging competing powers from positions of strength rather than dependency. The Pacific Resilience Facility, Ocean of Peace Declaration and 2050 Blue Strategy for the Blue Pacific Continent demonstrate Pacific-led institutions that are not defined by great power preferences. The principles below apply to every democratic partner engaging the region: the United States, Australia, New Zealand, Japan, France and others, though examples in this analysis often draw on US experience, whose recent volatility offers lessons for all.
Democratic institutions serve Pacific peoples when they enable autonomy and reflect Pacific values of consensus and transparency. Pacific leaders have already stated what they expect from external engagement — the Ocean of Peace Declaration calls on “all states and non-state actors” to engage the Blue Pacific in ways that honour “the Pacific Way,” and support “national and Pacific-led approaches.”
The narrower engagement model now taking shape can work, but not on its own. Cables, patrol boats and commercial agreements deliver returns only where institutions can regulate, enforce and negotiate around them. Governance capacity is not an alternative to that agenda; it is the precondition for it. The Pacific will chart its own course. External partners can either support that journey, on the terms the region has set, or find themselves increasingly irrelevant to outcomes that matter.
- Prioritise partnerships with Pacific-led multilateral fora. As the Ocean of Peace Declaration states above, Pacific leaders have already set the terms of engagement. Working through Pacific-led institutions like the Pacific Islands Forum and Pacific Community is not a courtesy; it is implementation of the region's own stated expectations.
- Pursue reliable forms of long-term commitments. Long-term presence matters more than project cycles. Predictable, multi-year commitments build trust and institutional capacity. Australia and New Zealand have demonstrated the value of sustained presence through decades of consistent engagement. The gap created by announcement and subsequent elimination of program commitments, as demonstrated by the region’s experience with USAID, shows how funding uncertainty undermines institutional strengthening regardless of initial investment levels.
- Share the burden among allies and partners. Multilateral coordination through the Quad and Partners in the Blue Pacific supports policy alignment among like-minded partners, including the United States, Australia, Japan, New Zealand and France. This maximises impact and reinforces shared priorities. Cooperation on disaster resilience, institutional capacity and maritime security serves Pacific and partner interests better than positioning Pacific nations within great power rivalry.
- Codify durable frameworks for engagement that transcend electoral cycles.Treaty obligations, multi-year compacts and legislated commitments enable systematic institutional development. Governance capacity should be funded as a strategic investment, not conventional development assistance, alongside maritime security, digital infrastructure and law enforcement capacity as the foundational elements of democratic sovereignty.
- Sustain high-level engagement and financial access beyond crisis response. Regular bilateral summits and ministerial dialogues signal enduring commitment. Technical assistance that helps Pacific nations access diverse international finance sources, not only bilateral aid, builds independent fiscal capacity alongside political partnership.
- Support governance efforts that strengthen Pacific sovereignty. Strong institutions, trusted information systems, effective rule of law and resilient civil society are what allow Pacific nations to set the terms of their own engagement with every external actor, resisting coercion, opaque lending and resource exploitation regardless of source.