Diplomatic ties

The foreign ministers of both countries formalised the joint communiqué with a signing ceremony in New York.

It occurs as leaders from all over the world gather in New York for the 78th session of the UN General Assembly.

Vietnam's foreign minister Bui Thanh Son says his government proposed cooperation in areas of trade and tourism.

Experts say the arrangement in Central Province would give the developer and other Chinese firms a strategic inlet into Solomon Islands, which until last month was one of Taiwan's dwindling allies in the Pacific.

The government traded Taiwan for China in a move that it said would promise more development for the nation.

The move was announced in a statement released on Monday by Taiwan's ministry of foreign affairs.

"The government hereby declares the termination of diplomatic relations with Solomon Islands with immediate effect, the end of all bilateral co-operative projects, as well as the recall of the staff of its Embassy, technical mission, and medical mission stationed in Solomon Islands," the statement said.

"The Taiwan government also demands that Solomon Islands immediately recall its government personnel from Taiwan."