U.S. Re-engagement on Pacific Minerals and the Penrhyn Port Development: The China Containment Dynamic and South Korea's Response

Executive Summary

The United States is accelerating its re-engagement with Pacific Island Countries by accumulating bilateral agreements, centered on the Cook Islands Critical Minerals Framework and the Penrhyn port development. This trend is unfolding amid a structural imbalance where aid budget cuts are paralleled by an expansion of commercial investment. China's response has so far been limited to rhetorical checks from its foreign ministry spokesperson. Due to the limitations of the Pacific Islands Forum's consensus-based system, U.S.-China competition is most likely to continue as a contest for bilateral agreements with individual island nations rather than a multilateral battle of condemnations. South Korea needs a parallel strategy: refraining from taking a public stance on internal PIF disputes while selectively engaging in U.S.-led projects as a third party. At the same time, it must consistently incorporate the risks associated with alleged links to deep-sea mining and the financial sustainability of projects into its feasibility assessments.

I. Situational Analysis

Situational Analysis: U.S. Re-engagement in the Pacific and the Penrhyn Port Development

1. Background and Developments

Penrhyn Atoll in the Cook Islands is the site of a former U.S. military base [1][4]. The island is a remote outer island located far north of the capital, Rarotonga. Due to its small population and low accessibility, it has historically been a low priority for infrastructure investment.

The turning point came this past February when the Cook Islands signed a Critical Minerals Framework with the United States [1][4]. This agreement institutionalized Washington's interest in the deep-sea mineral resources near the Cook Islands [1]. U.S. Deputy Secretary of State Christopher Landau spearheaded the agreement.

Landau's tours of the Pacific became regular starting in February of this year. He invited Pacific leaders to Honolulu, arranging meetings with U.S. investors and military officials [9]. Subsequently, he visited Fiji, Samoa, Tonga, the Marshall Islands, Palau, and Papua New Guinea in succession [16]. The State Department has publicly described this trend as an effort to reshape relations with the Pacific by "promoting U.S. business and investment" [9][3].

This reshaping is set against the backdrop of the 2022 Solomon Islands-China security pact [3][6]. Since the pact was signed, Canberra and Washington have grown more alarmed about a security vacuum in the region. The limitations of the Pacific Islands Forum (PIF), which operates on a consensus basis, also became apparent during this period, as its structure effectively blocks any statements condemning China [3][6]. The United States has bypassed this limitation not through multilateral channels, but by accumulating bilateral agreements with individual island nations [3][6].

2. Current Situation

At the PIF Leaders Meeting in Palau last week, the United States announced a Pacific investment and aid package of over $150 million [9]. A $60 million fuel security deal was also discussed at the same event [14]. RNZ Pacific reported that this matter was handled in a "dialogue partner meeting behind closed doors" [14].

The Penrhyn port development was announced as a key project within this package. The funding structure involves the United States contributing $50 million and New Zealand $10 million [1][4]. The total project cost was later confirmed at $60 million [7][13]. Cook Islands Prime Minister Mark Brown described the port as a "lifeline" for the people of Penrhyn [7]. He stated that the project is one of the largest infrastructure undertakings in the history of the Cook Islands [7].

RNZ Pacific reported that concerns about transparency and environmental impact were raised immediately after the announcement [7]. Greenpeace criticized the port project as a "Trojan horse" for initiating deep-sea mining [13]. RNZ also noted that this investment comes on the heels of the Trump administration's significant cuts to Pacific aid budgets [13].

China's Ministry of Foreign Affairs issued an official response to the port plan. Spokesperson Guo Jiakun stated, "Cooperation between countries should contribute to maintaining regional peace and stability" [11]. The Global Times reported this statement as a response to the U.S.-New Zealand plan for Penrhyn port [11]. While the statement itself is indirect, it can be read as targeting the symbolic nature of redeveloping a port on the site of a former U.S. military base.

Parallel moves are also underway at the levels of the U.S. Department of State, Department of Energy, and Office of the Trade Representative. In August, the Department of Energy allocated $500 million to seven projects to secure critical mineral and battery supply chains [2]. USTR representative Jamieson Greer issued a statement welcoming S&P Global's announcement of benchmarks to ensure price transparency for critical minerals such as gallium, germanium, tungsten, antimony, and neodymium-praseodymium [10]. This shows a dynamic where efforts to overhaul domestic supply chains and establish pricing standards in the U.S. are proceeding concurrently with individual projects in Pacific Island Countries.

3. Key Actors and Stances

The Cook Islands Governmentdefines the Penrhyn port project as an economic and livelihood infrastructure initiative. Prime Minister Mark Brown has described the project in terms of improving connectivity for the outer islands [7]. However, interpretations have also been raised both domestically and internationally that the project is a strategic precursor to securing deep-sea mining rights [13].

The U.S. Department of Statewith Deputy Secretary Landau at the forefront, has explicitly reframed its Pacific engagement around the pillar of "promoting U.S. business and investment" [9]. This signifies a shift from aid-centered to commercial interest-centered engagement. The economic security frame of securing critical minerals has been added to the existing security frame, which includes security pacts and submarine cable projects.

New Zealandas a traditional partner to the Cook Islands in free association, has participated in this project with a small but explicit stake [1][4]. From Wellington's perspective, this can be read as an intention to manage the manner of U.S. involvement in its sphere of influence in the South Pacific through co-financing.

China's Ministry of Foreign Affairshas signaled its reservations not through direct opposition but with principled language about "regional peace and stability" [11]. This contrasts with the situation on the PIF's multilateral stage, where condemnations of China are structurally blocked. China appears to be following a pattern of refraining from official commentary on individual projects while selectively responding to U.S. moves to repurpose former military bases.

Environmental and Civil Society Groups(such as Greenpeace) are framing the Penrhyn port development as a preliminary step toward expanding deep-sea mining and are raising issues of transparency [7][13]. This criticism, separate from the U.S.-China competition frame, is a key driver of the internal debate in the Cook Islands over the balance between development and the environment.

4. Key Issues

The first issue is the characterization of the port development. Interpretations are divided on whether it is a livelihood infrastructure project or a strategic move to secure deep-sea mining rights [7][13].

The second issue is the parallel track of aid cuts and investment expansion. It remains to be seen how the contradictory signals—of the Trump administration cutting Pacific aid budgets while increasing commercially-oriented investment—will affect the island nations' trust in the United States [13][9].

The third issue is the level of China's response. A key point to watch over the next 12 months is whether Beijing will maintain its principled statements or concretize its approach with separate economic and diplomatic overtures to the Cook Islands or neighboring island nations [11][3].

The fourth issue is the constraint of the PIF's multilateral system. Due to its consensus-based rule, this matter was also handled only through bilateral channels without an official Forum-level position [3][6][13]. As long as this structure remains, U.S.-China competition is likely to continue in the form of an accumulation of individual agreements with separate island nations.

II. In-Depth Analysis

In-Depth Analysis: U.S. Re-engagement in the Pacific, Its Structural Causes and Historical Trajectory

1. Analysis of Root Causes

The ostensible justification for the Penrhyn port development is to support livelihood infrastructure for the residents of the underdeveloped atoll [7]. However, the real driving force behind the project lies elsewhere. The starting point is the Critical Minerals Framework that the Cook Islands signed with the United States this past February [1][4]. This agreement is a document that institutionalizes Washington's access to deep-sea mineral resources near the Cook Islands [1]. The Penrhyn port was planned as the physical infrastructure to support this framework.

The root causes can be divided into two streams. One is resource security. The U.S. Department of Energy announced in August that it would invest $500 million to strengthen battery and critical mineral supply chains [2]. The USTR also issued a statement emphasizing price transparency for items like gallium, germanium, tungsten, antimony, and neodymium [10]. This demonstrates that Washington's policy direction of breaking away from rare earth and strategic mineral supply chains dominated by China is extending to the level of Pacific Island Countries.

The other is alarm over a security vacuum. The signing of the Solomon Islands-China security pact in 2022 was a watershed moment for this concern [3][6]. Since that event, Canberra and Washington have solidified their perception that China's security proximity in the Pacific Island Countries conflicts with their own interests [6]. The fact that Penrhyn was a former U.S. military base holds symbolic meaning in this context. The redevelopment of a port at a former military outpost has the effect of combining two objectives—resource access and securing a security foothold—within a single project.

2. Structural Context

Political Structure: The Blocking Effect of the PIF's Consensus-Based System

The Pacific Islands Forum operates on the basis of unanimity. Due to this institutional characteristic, it is structurally difficult to issue statements condemning China [3][6]. The United States has not attempted to break through this limitation head-on. Instead, it has opted to accumulate bilateral agreements with individual island nations [3][6]. The Penrhyn port, the fuel security deal, and the Tonga cybersecurity agreement are all products of this pattern [3]. The $150 million package announced on the occasion of the PIF Leaders Meeting in Palau was also not a multilateral statement but was handled in a "dialogue partner meeting behind closed doors" [14]. This implies that the United States is using the multilateral stage of the PIF merely as a backdrop for announcing bilateral agreements.

Economic Structure: The Replacement of Aid with Commercial Investment

RNZ noted that this investment came immediately after the Trump administration's drastic cuts to the Pacific aid budget [13]. The State Department has specified that it is reorienting its Pacific relations toward "promoting U.S. business and investment" [9][3]. This signifies a pivotal shift from aid-centered engagement to one centered on commercial interests. The Lowy Institute's 2026 Pacific Aid Map report calculated that aid and development finance to the Pacific region from 2008 to 2024 amounted to $60 billion across 50,000 projects [12]. The U.S. commercial investment package is being layered on top of this vast accumulation of aid. The problem is that this commercial investment is too small in scale to offset the aid cuts. The $150 million package is a negligible amount compared to the cumulative aid volume tallied by the Lowy Institute.

Security Structure: The Dual Framing of Deep-Sea Mining

Greenpeace has defined the Penrhyn port as a "Trojan horse" for initiating deep-sea mining [13]. This criticism points to the structural issue of a single project bundling together public welfare infrastructure—a port—with a commercial and security agenda—deep-sea mineral extraction. From the Cook Islands government's perspective, the project clearly has the character of a tangible public welfare initiative, as Prime Minister Mark Brown described the port as a "lifeline" for the people of Penrhyn [7]. From the U.S. perspective, however, it is also difficult to deny that the project is a mechanism for implementing the Critical Minerals Framework [1][4]. The very structure in which these two frames coexist without conflict within a single port project reveals the position of Pacific Island Countries amidst great power competition.

3. Historical Precedents and Comparative Cases

The 2022 Solomon Islands-China Security Pact

The most direct precedent is the 2022 Solomon Islands-China security pact [3][6]. This agreement sent an immediate alarm signal to Canberra and Washington [6]. The subsequent U.S. response took the form of rebuilding its security network. In 2023, it signed a security agreement with Papua New Guinea and held the U.S.-Pacific Island Country Summit in the same year [3][6]. The South Pacific submarine cable project with Australia and Japan also began during this period [3][10]. The Penrhyn port project is an extension of this response pattern from three years ago. The dynamic of the U.S. countering China's economic and security engagement with a combined economic and security frame is repeating itself.

The Vanuatu Road Project and Unconditional Economic Engagement

China's approach to the Pacific is characterized by unconditional economic engagement, typified by the Vanuatu road project [6]. This approach has been pursued on a separate track, parallel to security provocations such as missile tests near Tuvalu and the entry of survey vessels into Palau's waters [6]. This contrasts with the American approach. The U.S. opts to tie explicit conditions and strategic intentions to its economic agreements, as seen in the Critical Minerals Framework [1][4]. China, on the other hand, has operated by separating its provision of infrastructure without upfront conditions from its security provocations [6]. The Chinese Foreign Ministry's response to the Penrhyn port, which remained at the principled level of stating that "cooperation between countries should contribute to maintaining regional peace and stability" [11], can be understood as a continuation of this parallel strategy. It stopped at signaling a check with normative language rather than offering a direct rebuttal.

South Pacific Submarine Cable Competition

The South Pacific submarine cable project, jointly pursued by the United States, Australia, and Japan in 2023, shows a similar pattern [3][10]. This project was also an approach that countered China's economic engagement with an infrastructure and security frame [6]. CSIS points out that the Quad countries have explicitly adopted infrastructure as a strategic agenda and even established a dedicated coordination group [8]. The Penrhyn port is the latest example of this infrastructure competition frame manifesting at the granular level of individual projects in Pacific Island Countries.

Debate over Military Expansion in the CNMI

Similar tensions were evident in the congressional elections in the Commonwealth of the Northern Mariana Islands (CNMI). Candidates clashed over whether the U.S. military's expansion within the territory brought sufficient economic benefits to the region [17]. This is in the same vein as the transparency and environmental concerns raised in the Penrhyn case. It signifies a recurring pattern across the Pacific where the security and resource interests of great powers take precedence, while the distribution of tangible benefits to local populations follows behind.

4. Key Variables Shaping Future Developments

The first variable is whether deep-sea mining actually commences. The key question is whether the Critical Minerals Framework will move beyond the exploration phase to actual mining approvals. If the "Trojan horse" scenario feared by Greenpeace materializes, it could intensify internal debates in the Cook Islands over the environment and sovereignty [13].

The second variable is whether U.S. aid budget cuts will continue. As RNZ pointed out, a key point to watch is how the current dynamic of expanding commercial investment while simultaneously cutting aid [13] will reshape the trust of Pacific Island Countries in the United States. If aid cuts persist, it will create more room for these nations to lean back toward China's unconditional economic engagement.

The third variable is the degree to which the multilateral channel of the Pacific Islands Forum (PIF) is weakened. If the current pattern—in which both the United States and China prefer accumulating bilateral agreements over issuing multilateral statements—becomes entrenched,[3][6] the PIF’s role as a substantive coordinating body could diminish further, leaving it with only the symbolic function of hosting summits.

The fourth variable is whether New Zealand and Australia expand their roles. The U.S. approach of distributing the investment burden through its Anglosphere allies, as seen with New Zealand’s co-funding of the Penrhyn port,[1][4] could be extended to projects in other island nations. This would reduce the financial burden on the United States alone while broadening the front of the Western bloc.