The Chinese Ambassador to Vanuatu, Bao Shusheng, has warned that Vanuatu risks losing ten million U.S. dollars in aid over its decision to establish full diplomatic ties with Taiwan.
The Vanuatu Daily Post says the ambassador expressed shock at the move and said the Chinese government was angry as less than two months ago Vanuatu's prime minister, Serge Vohor, visited China.
He said the aid from China consisted of surplus funds the government had not allocated.
Mr Bao said China had been waiting for the Vanuatu government to send details of projects for consideration, but they had only received a request for 18 new luxury Buick cars for cabinet ministers.
China has already spent money on building the national parliament, a University of the South Pacific complex, an agricultural college and the new Ministry of Foreign Affairs.
Beijing has also sent medical teams, teachers and a table tennis coach.
The Ambassador said if the government seriously wanted to end the relationship with China, the 10 million US dollars would be immediately stopped and the Chinese Embassy pulled out of Vanuatu.