Turnbull is trying to rally support from key Pacific nations to fight China's influence in the region

Michael Masters/Getty ImagesAustralian Prime Minister Malcolm Turnbull.

Prime Minister Malcolm Turnbull has shrugged off renewed threats to Australia’s trade relationship from an angry Beijing, while at the same time using high-level talks to steer key Pacific nations away from Chinese influence.

In a meeting held on the sidelines of the Commonwealth Heads of Government Meeting in London, Mr Turnbull received an assurance from Vanuatu’s Prime Minister Charlot Salwai that he would never allow a Chinese-funded port in his country to be used as a military base.

In a separate meeting, also overnight Wednesday with his Solomon Islands counterpart Rick Houenipwela, Mr Turnbull assured him Australia would fund an undersea internet cable between the two nations, squeezing out a rival bid by Chinese telco Huawei.

“We are building a fibre optic cable which will connect both the Solomons and Papua New Guinea to Australia and hence to the internet and that is going to deliver enormous benefits to both countries,” he said.

China’s soft diplomacy approach of loans and infrastructure to spread its influence in the Asia-Pacific has been a dominant topic in London, given 11 of the 15 Pacific Island Forum nations are also members of the Commonwealth.

CHOGM host the United Kingdom is also pledging to boost its diplomatic footprint in the region to act as a counterweight to China once the UK exits the European Union and regains control of its aid budget.

Tensions rise

But as Mr Turnbull was meeting Pacific Island leaders, simmering tensions with Beijing caused primarily by Australia’s foreign interference laws boiled over.

China’s Ambassador to Australia in Canberra, Cheng Jingye, cited “systematic, irresponsible, negative remarks” in the second half of last year had strained relations and could have an “undesirable impact” on trade. These remarks relate to the introduction of foreign interference laws and the government’s hounding of now-former Labor Senator Sam Dastyari who was forced to quit Parliament after sympathising with Beijing over the South China Sea.

Last week The Australian Financial Review revealed an angry China was going slow on issuing visas to ministers and had cancelled the biennial Australia Week in Shanghai exposition.

Mr Turnbull shrugged off the latest outburst and said Australia would always put its own interest first.

Australia would not be shying away from the foreign interference legislation which was aimed not just at China but also Russia which was also mounting cyberattacks on Australia and her allies.

“We are taking every step that we can with our foreign interference legislation to ensure that Australians and Australians only are the ones who influence Australian political processes,” Mr Turnbull said.

“We make no apologies for and will not take a backwards step from standing up for Australians’ right to determine their political processes, who’s elected to their Parliament, how laws are debated and resolved.

“That is the right and the duty of every sovereign state.”

On the trade threat, Mr Turnbull was unfazed.

“We have a very strong economic relationship with China, it’s in fact strengthening all the time. We are committed to a stronger relationship,” he said.

“From time to time there are differences in the relationship but if there are ups and downs, it’s from a very very high base.

“Trade has never been higher in any respect, whether it’s in tourism, whether it’s in education, whether its in exports of the finest food and commodities that Australia can produce.”

Last week, Fairfax Media reported there had been preliminary discussions between China and Vanuatu about Beijing establishing a military footprint in Vanuatu, a scenario Mr Turnbull said would threaten regional peace and stability.

Mr Salwai assured Mr Turnbull he had no plans of allowing China to establish a military footprint in his country.

“I rule out, I rule out,” he said after the meeting.

“Vanuatu was never dreaming to become a military base one day. It is not in our culture, it is not in our tradition.”

Mr Salwai noted that a port built in his country with a loan by China and which sparked concerns about it being used one day for military purposes, was cheaper than a separate port the Japanese funded.

“We don’t invest in a project that doesn’t have a return,” he said.

He said the wharf funded by the Japanese was “more expensive than the one we got the loan from China”.

“The one in Port Vila, its more expensive and was built from a concessional loan from Japan.”

This article was originally published by the Australian Financial Review. Read the original here, or follow the AFR on Facebook.

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.