Oceania is a battleground for China and Taiwan in terms of diplomatic recognition. Some Pacific Island nations switch their recognition between the two governments, causing political instability. Australia and New Zealand have good relations with China but both governments actively seek support from smaller Pacific Island nations through aid and development projects. These nations receive significant amounts of aid and promise to support Taiwan's interests in the United Nations in return. In addition, there are Chinese communities and Chinese investments in several Pacific countries, including Australia, Papua New Guinea, and Vanuatu. China has increased its diplomatic ties and economic aid to the Pacific Islands Forum, while asserting that the forum should not engage with Taiwan. Chinese Premier Wen Jiabao visited the Pacific islands in 2006, and the interaction between China and the Pacific has often been described as "chequebook diplomacy" and a competition for diplomatic recognition with Taiwan. There are concerns about China's influence in the region, but the Lowy Institute found that the loans provided by China are not predatory and many have concessional rates. However, it also recommended that China provide more grant assistance rather than loans to avoid overburdening Pacific island nations with debt. In 2006, Taiwan hosted the first Asia-Pacific summit with its Pacific Island allies, which became a regular event known as the Taiwan-Pacific Allies Summit. In 2008, the new President Ma Ying-jeou promised to end Taiwan's "cheque-book diplomacy" in the Pacific and called for a "cease-fire" in the competition with China for diplomatic allies. Taiwan has also donated aid packages and scholarships to Pacific countries, and is seeking recognition as an official dialogue partner of the Pacific Islands Forum. Australia and China have a strong trading relationship, with China being an important destination for Australian exports. Kevin Rudd, the former Prime Minister of Australia, was seen as favorable to China-Australian relations due to his fluency in Mandarin and his focus on closer engagement with Asia. Australia supports a "one-China policy", but has also raised concerns about human rights issues in Tibet and expressed support for Taiwan's participation in international organizations. Fiji established diplomatic relations with China in 1975 and has since strengthened its trade and economic ties with the country. Despite its relationship with China, Fiji has also received free medical assistance from Taiwan and is grateful for the support.

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