It's an issue that boils over occasionally in Papua New Guinea such as in the Lae rioting late last year and there's a history of anti Chinese riots in Solomon Islands too.
Graeme Smith from the University of Technology Sydney says there's also tension between old established Chinese communities in the Pacific and the newer arrivals.
Presenter: Brian Abbott
Speaker: Graeme Smith, Post Doctoral Fellow, China Research Centre, University of Technology, Sydney
SMITH: I guess you could break it down to a couple of things, one would be the repeatedy of change, so the influx has been very sudden over the past decade as opposed to I guess a rather gradual controlled entry of Chinese citizens that you've seen in the past under colonial administrations. The other would be I guess to an extent in many Melanesian countries if you like the racist attitudes of many of the colonial administrations that were the basis of keeping Chinese out and I guess some of those racist attitudes had commercial underpinnings. These sorts of attitudes have been I guess imbibed by the local populations and that when your talking visual ? haze I think that's where a lot of that comes from.
ABBOTT: It's because they are so different to the local population?
SMITH: Certainly many of the newcomers and you see this in interviews all throughout the Pacific tend to be a bit impatient if you like in their way of doing business and there's a feeling that they cut corners and don't necessarily pay the taxes that they should be paying and don't necessarily employ local workers, that's a particular sticking point.
ABBOTT: In some cases, local workers are employed, in some cases it's the only work locals can get is to work in these Chinese-owned retail outlets?
SMITH: Absolutely, I mean that's the otherside of the story, which is very rarely told.
ABBOTT: Their claims that these shops should really be run by them, rather than these newcomers. Is there substance to that claim?
SMITH: It is sort of a hangover from colonial rule that there were reserved occupations for the locals and these laws are still in force, so to the letter of the law there is a definite violation going on or if you like a bending of the rules. But I guess the otherside of the story is many of these shops that the Chinese are said to have taken over have local landlords who don't want to run the shop and aren't willing to be there from 8 in the morning till 7 at night, and in that case, it's often the local landlord whose doing very nicely, while the Chinese person in the shop cops the blame.
ABBOTT: Is increased migration from China the price that the Melanesian countries have to pay for increased investment and increased aid from Beijing?
SMITH: I don't think they have to. I mean there are many models in the Pacific. If you go to Samoa, for example, there are very few Chinese shopkeepers and yet the economy which is arguably a remittance economy is doing quite well without the migration that comes with the investment. But if you look at figures and it's very hard to get reliable figures. In PNG, the amount of Chinese foreign direct investment is in the range of 11 to 12 billion dollars and of that, nearly half of that investment is in the retail sector. So it's a not insignificant amount of capital flowing in.
ABBOTT: Are the new migrants from China different from those who arrived in Colonial days?
SMITH: Absolutely, very, very different and this is part of the problem with assimilation in any Chinese diaspora is you'll have the existing Chinese population and they may speak a completely different language to the new arrivals. So in the case of many of these places, the old Chinese population has been there so long and assimilated so effectively, they may no longer even speak a basic form of Chinese. They're first language is English, Tok Pisin or whatever the Pidgin variant might be in a given country. So in that case, the scope for assimilation is between the new arrivals and the old Chinese is very, very limited and on top of that, you often get a sort of tension between the existing well established well capitalised business and the newcomers who are operating at much thinner margins and might even end up in a situation where they're owing a debt to the wholesaler, who will often be the old Chinese and they're not paying their debts for the goods that they're buying from the wholesaler and so you get this tension that builds up between the old community and the new rivals.
ABBOTT: Is there any attempt anywhere across the region to reduce racial tension in the community?
SMITH: That's a very interesting question. The difficulty is once positions get polarised to a certain extent. If you try to be a voice of moderation, you're often as an apologist if you like for often very unsavoury business practices that do occur. Certainly at the local level, what you see is individual Chinese businessmen who have I guess understood how to do business. A good example would be the Ben Kantor chain in Goroka in Papua New Guinea, that particular chain takes a lead in basically trying to coach the new arrivals into how to do business in Papua New Guinea, but that would be I guess the exception to the rule, normally it's sort of left to the embassy to try and teach them how to do business. But often the embassy is very disinterested in these new arrivals, because they see them, if you like, or they view them almost as negatively as the locals do. In many cases, they see them as kind of get rich quick and sort of a very poor quality to borrow the Chinese term, very sort of low suzhi is the Chinese term used.
ABBOTT: Would the old Chinese have faced similar problems when they first arrived in the region?
SMITH: Absolutely, and that's a really, really good point. When you look back over the historical records, the new arrivals often faced even more certainly in legal terms they faced some very serious restrictions and very serious racism, particularly from the Colonial corporations if you like, who saw the Chinese newcomers back then as a sort of a direct competition to companies such as Steamships or Burns Philip and they would basically set up all manner of legal barriers to the Chinese assimilating with the local population. In some cases, Chinese were forbidden to marry locals, these sorts of laws and there were restrictions of where they could set up their shops and all manner of discriminatory policies were in place.