Australia eyes security pact with Fiji as pushback from Beijing undermines agreement with Vanuatu

Australia is close to a security and economic agreement with Fiji while Beijing’s resistance has complicated a separate deal with Vanuatu. Foreign minister Penny Wong’s three‑day visit will push the Vuvale Union, with talks focusing on energy and fuel security and supply‑chain disruptions tied to the war in Iran. The political moves aim to shore up Australia’s influence in the Pacific and reduce China’s foothold after stalled negotiations in Vanuatu and other regional deals. For markets, outcomes could alter regional risk sentiment, influence Australian trade and energy security dynamics, and therefore affect AUD demand—potentially supporting AUD if ties improve trade and security, or weighing on it if geopolitical tensions with China intensify.