Officials in Taiwan are insisting they have created a new diplomatic link with Vanuatu.
A foreign ministry spokesman Michel Lu says Taiwan and the Republic of Vanuatu have signed a communique to open a full diplomatic relationship.
Mr Lu says the Vanuatu Prime Minister Serge Vohor has signed the document.
He says the two countries have "pledged to promote cooperation in fields of mutural interest".
China is competing with Taiwan for diplomatic influence in the Pacific and disputes these claims.
A spokeswoman for the Chinese foreign ministry says China's ambassador to Vanuatu asked the Vanuatu side for a clarification.