The world might have to prepare to welcome a new country after today, when the citizens of the French island territory of New Caledonia vote to decide on its future ties to France.

The long-awaited independence referendum on the small territory, known for its palm tree-lined beaches and spectacular lagoon, holds high stakes for France, Australia and the greater Pacific region.

An expert on New Caledonia, Ms Denise Fisher, a former Australian consul-general in the territory, said the vote could affect the regional power dynamics.

France has long played an important role in the South Pacific and has signalled that it wants to work with other local powers such as Australia and New Zealand to counter China's growing regional influence.

"There are high stakes for France," said Ms Fisher, a visiting fellow at the Australian National University's Centre for European Studies.

"The territories have strategic value. France's Pacific possessions give it a place at regional tables, which is important."

She added that whatever the outcome, France will not completely disengage from the territory, which has a population of about 280,000.

In May, French President Emmanuel Macron made his first visit to New Caledonia, saying he would not back a side in the referendum. But he said the territory, which was colonised by France in 1853, was a "jewel" and expressed hope that it would remain part of France.

"France would not be the same without New Caledonia," he said.

In the French Parliament, New Caledonia is represented by two deputies and two senators.

The territory receives about €1.5 billion (S$2.3 billion) from France each year but also generates considerable income from its substantial nickel deposits, one of the largest in the world.

This has made it wealthier than other nearby Pacific island countries. But the wealth has not been evenly spread.

The indigenous Kanak people tend to have lower incomes than the European population and believe that independence would result in the territory receiving a greater share of income from nickel mining.

The Kanaks make up 39 per cent of the population, according to a 2014 census, and are expected to vote largely for independence. About 27 per cent are Europeans, most of whom were born in the territory. The remainder are made up of other communities, such as Polynesians and Indonesians.

A vote for independence would likely result in a declaration of statehood in 2021, with the proposed name of the country as Kanaky New Caledonia.

The referendum has been decades in the making and follows long-running tensions between the Kanaks and local French loyalists that can be traced back to the 1870s, when indigenous people clashed with European settlers over land.

During the 1980s, the territory underwent tragic civil strife, resulting in a crisis in 1988 in which pro-independence Kanaks held about two dozen French hostages in a cave.

The Kanaks demanded then, among other things, a referendum on self-determination, with voting to be restricted to Melanesians and others whose parents were born in New Caledonia.

During the tensions, several people of European origin were shot and wounded. Nineteen Kanaks were eventually killed, along with two French gendarmes, or paramilitary officers.

But the violence in the 1980s, which resulted in the deaths of about 80 people, paved the way for fresh efforts to soothe tensions.

The territory was given greater autonomy and the various parties agreed to an accord that led to the current referendum which Ms Fisher said had been repeatedly delayed due to fears it would stir tensions.

"The fact they are holding it at all is a positive development," she told The Sunday Times. "It is quite a historic moment."

Most analysts believe the pro-independence vote will fail. Surveys have shown that up to 75 per cent of registered voters will oppose independence.

The leader of a pro-France party, Mr Philippe Gomes, said he believed staying with France would help to ensure community harmony. "I believe that we need to stay with France," he told ABC News last Friday. "France is the link between all the different communities in the country. To leave France is to risk cutting these links."

France's Prime Minister, Mr Edouard Philippe, is due to travel to Noumea, the local capital, immediately after the vote to hold discussions with local leaders about the result. If the vote is for independence, the territory would have its own armed forces but would likely seek defence cooperation arrangements with France and other Pacific countries. An anti-independence vote would not be an end game for the Kanaks.

If the vote is to stay with France, two further referendums are due to be held in the next four years.

If all three fail, the move towards complete independence will be considered to be settled.

But with the Kanak population increasing, relative to the others, the pro-independence vote may yet receive a boost in future ballots.