Despite assurances that Vanuatu has ruled out allowing China to build a military base on its shores, Australian diplomats aren't complacent.
China is building a wharf in Vanuatu funded by a concessional loan and in April there were reports it was seeking a military base. Beijing dubbed the reports "sheer fiction".
Department of Foreign Affairs and Trade official Daniel Sloper told a Senate estimates hearing there were concerns any potential bases could lead to strategic competition in a region that doesn't experience that at present.
Secretary Frances Adamson said there were concerns it could also lead to a direct military threat to Australia.
The job of diplomats was to ensure the region remains peaceful and uncontested and that the "distant prospect of a foreign military base" in the Pacific remains that way, Ms Adamson said.
Asked if she considers it distant: "We never want to be complacent about these things".