The Australian White Paper does not name China when it notes "increasing competition" for influence and economic development in Pacific countries, as well as growing aid and loans from other countries.
"This brings opportunity in many cases, but also has the potential to strain the capacity of countries to absorb assistance and manage their debt levels. It could also undermine regional co-ordination."
Australia is working on a "step-change" in its work with Pacific island countries, which includes integrating them with the Australian and New Zealand economies and security institutions.
"Our partnership with New Zealand will be central to advancing this agenda."
Australia will work closely in the Pacific with New Zealand, the United States and France on maritime surveillance to combat threats such as illegal fishing and drug smuggling, the paper states.
Security
Threats including Islamist terror, cyber attacks and transnational organised crime could worsen in the next decade, the paper states. Hacking and the phenomenon of "fake news" are also alluded to.
"Australia and other countries must also deal with challenges from efforts to interfere in democratic decision-making and to shape public opinion through misinformation, including through the use of new technologies."
Australia's co-operation with Five-Eyes intelligence partners – including New Zealand – is identified as a critical factor in addressing terrorism and other threats.
"In the period ahead, we will place particular importance on strengthening counter-terrorism co-operation in Southeast Asia."
The White Paper underlines Australia's commitment to the US, but notes "powerful drivers are converging in a way that is reshaping the international order and challenging Australia's interests".
"The United States has been the dominant power in our region throughout Australia's post-World War II history. Today, China is challenging America's position."
