A Vanuatu Cabinet Minister says the Prime Minister, Serge Vohor, is under pressure to find funding to implement his policies and this is why he wants to grant diplomatic recognition to Taiwan.
But Willie Jimmy, who is the Infrastructure Minister, says it is the wrong move and Vanuatu needs to stick with its one China policy and back Beijing.
The Prime Minister's spokesman, Kal Moli, maintains there is full support within government for the plan, but it has demoted Foreign Minister, Barak Sope - who last week led opposition to the plan - to a junior portfolio.
Mr Jimmy says the Prime Minister's push for Taiwan could lead to a vote of no confidence, but he says he understands why Mr Vohor's made the offer.
"it is his responsibility to make sure that his government delivers some services to the people of Vanuatu, and if Taipei is willing to step in and balance our budget and take on extra government intiatives through its economic policies, it is his right to do that, but for how long, who knows?"