The Next Island Crisis

A quiet corner of the South Pacific could turn quite turbulent before the end of the year. New Caledonia is a French South Pacific holding, and it is a growing target of Chinese influence and coercion, with implications for America’s wider Pacific strategy.

Key to this process will be a slow transfer of state power to New Caledonia, indicating the island will, if the referendum passes, receive a gradual increase in self-determination, including the powers to administer international economic deals, foreign policy, and immigration. 

If this language of “decolonization” sounds familiar, that’s because it is the same Marxist inspired language used in the handover of Chagos to Mauritius by the Labor government of Prime Minister Keir Starmer. 

Elysee-Oudinot's process of decolonization and increased foreign policy autonomy for New Caledonia raises questions for US policymakers. Primarily, how can America and its allies assure a more sovereign New Caledonia that is not unduly influenced by China? 

The reason for China’s fishing operations goes beyond the Chinese demands for fish. In short, it’s economic coercion. China uses these operations to force island nations in the Pacific to be more amenable to Chinese influence and demands. This makes the sustainability of these nations' waters dependent on their cooperation with Beijing and brings a significant risk for an independent or autonomous New Caledonia. 

Although New Caledonia is not currently under a direct threat of Chinese aggression, China has influenced pro-independence movements in New Caledonia. This influence could be used to affect the upcoming referendum. 

For example, China has been accused of aiding the most prominent independence party, the Kanak and Socialist National Liberation Front (FLNKS). Tensions that have most recently in 2024 led to riots with 14 killed and $2.4 billion in damages. 

Liu Jiyou, a founder of the Chinese Association of New Caledonia, claimed that he and other influential Chinese businessmen in New Caledonia aided China in giving funds to the FLNKS. Liu’s claims are significant, although currently, specific quantities are yet to be confirmed or specified. 

Another facet of Chinese influence in New Caledonia is the Sino-Caledonian Friendship Association, in which key party members of the FLNKS party, such as former party president and President of the New Caledonian congress from 2019-2024, Roch Wamytan, have connections. 

China has a clear intent to involve itself in the future of New Caledonia, similar to the situation in Bougainville, which is an autonomous state of Papua New Guinea. China has extended various offers of $1 billion USD of investment and development to the autonomous government of Bougainville, which could become an independent nation by 2027. China has also foster strong connections with officials in the Bougainville military and political institutions. 

The case of Chinese attempts to influence the independence movement of Bougainville offers lessons for New Caledonia. The ramifications of Elysee-Oudinot and the process of New Caledonian sovereignty opens it to increased Chinese influence and interference. 

The local dispute over independence remains an issue China could inflame despite past referendums killing the notion. New Caledonia consistently voted against independence in 2018 (56.67% against independence), 2020 (53.26% against independence) and a 2021 referendum (96.5% against independence) which the Kanak opposition boycotted. 

In France, political parties such as National Rally and Les Republicains have criticized President Macron and his government for agreeing to a new referendum, arguing economic development, not continued independence referendums, is the more effective path for the island. Ignoring these criticisms, Macron agreed to a new referendum in New Caledonia by the end of 2026. 

Chinese investment in New Caledonia is informed by strategic interests. New Caledonia’s biggest industry is its nickel mines, in which the small islands’ mines make-up around 7% of the world’s total nickel reserve. China’s Nanjing Geological Survey has recommended as much, stating that New Caledonia’s mines are a “critical asset” to maintaining Chinese nickel supply in the future. 

Strategically, New Caledonia could play a critical role in any future conflict with America and its allies in the Pacific. New Caledonia is relatively close to US allies Australia and New Zealand, providing China a strategic operations hub in the South Pacific. 

The South Pacific has seen significant efforts from China in expanding its power projection in the region. In 2022, the Solomon Islands made a security pact with China in 2022. This leaked security agreement would give China an overseas military base in the South Pacific. 

Acquiring access to New Caledonian port facilities would not be the first instance of Chinese naval presence in the region. China is also heavily investing in the nearby ports of Luganville and Port Vila in Vanuatu. Port Vila has in 2025 hosted China’s Navy Type-052 destroyers. The danger is clear and present -- illustrated in February 2025 when Chinese warships conducted live fire naval drills in the Tasman Sea before circumnavigating Australia. 

New Caledonia’s natural resources are lucrative, but the recently upgraded naval facilities in its capital of Noumea offer China a strategic win. 

To forestall the worst of Chinese influence in New Caledonia, America has allies who can join in a common effort to contest China’s South Pacific encroachment, notably the Pacific Quad consisting of the US, France, Australia, and New Zealand. But getting eyes on the ground is critical, with a permanent diplomatic presence via a new consulate in Noumea. 

This diplomatic presence would enable effective shiprider agreement to enhance maritime security and facilitate port visits by the U.S. Coast Guard and the Navy. 

Given its actions, China poses a challenge to the French territories of the Indo-Pacific, and Paris will before the end of year have to decide how much Chinese influence it will tolerate in its Pacific holdings. At the same time, the example of Papua New Guinea stands out. Island nations are too comfortable with China’s inroads and are increasing interoperability of its armed force with the Australians, and hosting a U.S. base in Manus. 

China’s advance in the South Pacific must be challenged, and America has friends and allies on the Pacific Islands -- and key allies ready to join in common cause. 

Brent Sadler is a senior research fellow specializing in naval warfare and advanced technology at The Heritage Foundation’s Allison Center for National Defense. Trevor LaClair is a member of Heritage’s Young Leadership Program.