SYDNEY/BEIJING: When Papua New Guinea Prime Minister Peter O’Neill flagged the possibility of China bankrolling a port development off his country’s northern…
SYDNEY/BEIJING: When Papua New Guinea Prime Minister Peter O’Neill flagged the possibility of China bankrolling a port development off his country’s northern coast in June, the consternation in neighbouring Australia set off a lightening-fast response.
Despite a change in leadership in Australia’s government in August, a rival offer was swiftly formulated, government and diplomatic sources told Reuters, amid concern the strategically-located Manus Island port could regularly host Chinese military vessels.
Canberra, a staunch Washington ally, said earlier this month it would fund the port development, part of what analysts see as a push to reassert its dominance in the South Pacific as Beijing seeks a more prominent role.
«The Manus Island port was a big concern for us,» a senior U. S. diplomatic source told Reuters, on condition of anonymity. «It was feasible Chinese military vessels could have used the port so we are very happy that Australia will fund the re-development.»
Australia is preparing to make the verbal agreement formal at this week’s Asia-Pacific Economic Cooperation (APEC) forum, held in PNG’s capital, Port Moresby.
While conceived as a means to remove trade barriers in the Pacific, the hosting of this year’s APEC has also seen PNG become a staging ground for regional influence where the U. S. and China lock in competing alliances.
China has spent US$1.3 billion (£1 billion) on concessionary loans and gifts since 2011 to become the Pacific’s second-largest donor after Australia, stoking concern in the West that several tiny Pacific nations could end up overburdened and in debt to Beijing.
China says it has no ulterior motive beyond assisting the development goals of Pacific Island nations and that Australia should see it as a partner, rather than rival, in the region.
On Friday, President Xi Jinping will showcase China’s Belt and Road to Pacific leaders, several of whom are expected to sign up to the infrastructure initiative.
Australian Prime Minister Scott Morrison last week characterised the Pacific as Australia’s «patch» while offering the region up to AUS$3 billion (£1.
