Australia to help PNG develop navy base on Manus Island to fend-off China

Australia said this year it will use part of a record allocation of aid for PNG to lay an undersea internet cable, assistance aimed at shutting out Chinese telecom giant Huawei Technologies Co Ltd amid national security concerns.

Australia is to help Papua New Guinea (PNG) develop a navy base, Prime Minister Scott Morrison said on Thursday, the latest Australian action to protect its interests in the Pacific in the face of a more assertive China.

Australia has for decades enjoyed largely unrivalled influence in the Pacific but China has in recent years turned its attention to a region blessed with abundant natural resources.

PNG said this year China was interested in funding the re-development of a navy base on Manus Island, an offer that diplomatic sources said worried Australia and its Western allies.

Morrison said in a speech in Sydney Australia would fund the project.

"I will formally commit to a joint initiative to develop the base on Manus Island," Morrison said.

PNG's navy is made up largely of patrol boats and landing craft.

Morrison did not say if Australia's navy would have access to the base.

He also did not say how much Australia would spend on the base. Australia has in the past used its foreign aid budget to fund similar security projects in the region.

Australia said this year it will use part of a record allocation of aid for PNG to lay an undersea internet cable, assistance aimed at shutting out Chinese telecom giant Huawei Technologies Co Ltd amid national security concerns.

Competition in the Pacific shows little sign of abating.

"Australia was particularly worried about China funding the port ... in a strategically important region," said a Western diplomat who declined to be identified as he is not authorised to speak to the media. 

(With inputs from agencies.)