China has emerged as a major donor in the South Pacific, including in forum countries Papua New Guinea, Fiji and Vanuatu.

"China's reaching out across the world including into our region and we have a very good relationship with China," Dutton said. "We want all of that to continue, but in our neighborhood we have a responsibility to work with our neighbors."

Minister for International Development and the Pacific Concetta Fierravanti-Wells' office did not immediately respond on Friday to a request for details on the agreement,

China protested in January when Fierravanti-Wells said Chinese aid programs in poor Pacific island countries were creating "white elephants" that threatened economic stability without delivering benefits.

Australia said last month that it would negotiate a bilateral security treaty with Vanuatu, weeks after Australian Prime Minister Malcolm Turnbull warned China against building a military base in the former joint British-French colony.

In May, China and Vanuatu denied media reports that the Chinese had approached the tiny country, which has a population of 280,000, about building a permanent military presence in the South Pacific.

Turnbull said at the time that Australia "would view with great concern the establishment of any foreign military bases in those Pacific island countries and neighbors of ours."

New Zealand Prime Minster Jacinda Ardern supported Australia's stance, saying her country takes "a strong position in the Pacific against militarization."