Proposal to Build Chinese City Near Tip of Australia ‘Speculation’: Aussie PM

Papua New Guinea Prime Minister Peter O'Neill, back left, attends a signing ceremony with Chinese Premier Li Keqiang, back right at the Diaoyutai State Guesthouse in Beijing, China on April 26, 2019. (Kyodo News/Parker Song, Pool).

CANBERRA, Australia — Prime Minister Scott Morrison has dismissed concerns over Beijing’s interest in building a $39 billion (US$29.4 billion) city just 200 kilometres (124 miles) from the tip of Australia.

The proposed site is an island named Daru in the southwest of Papua New Guinea (PNG), which lies to the north of Australia.

Morrison downplayed concerns on Friday, calling them “speculation.”

“I have a very good relationship with Prime Minister Marape of Papua New Guinea, and we regularly discuss the various pressures in our region, and I think we are very much on the same page of those issues,” Morrison said.

The proposed development would span 100 square kilometres (38 square miles) and include an international seaport, free-trade zone, and agricultural and manufacturing facilities.

It will be built under a Build-Own-Transfer or BOT arrangement, where China would own the asset for an unspecified period of management before it was turned over to PNG control, The Australian reported.

The proposition comes after Chinese state-owned enterprise Fujian Zhongshong Fishery Company inked a deal in November last year. The deal would see the company build a fish processing plant on the island for Chinese vessels entering the region and as a place to process catches taken from the Torres Strait as part of PNG’s Belt and Road agreement. PNG signed on to the Belt and Road Initiative in 2018.

PNG Fisheries Minister Lino Tom at the time said the project was a priority for the PNG government as it wanted to realise the potential of the Torres Strait fishery.

“This large investment project will bring employment to the local area and promote the economic development of Western Province and PNG,” Tom said. “On behalf of Prime Minister Marape, I thank Chinese investors for investing in Western Province and the Chinese Embassy in PNG for supporting the project.”

China’s investment in the province is also heavily supported by the provincial governor Toboi Awi Yoto.

Yoto took to Facebook on Jan. 27 to criticise Australia for its lack of real action and aid in his province after a Department of Foreign Affairs and Trade delegation met with Yoto in Daru last month.

“They came with no alternative plans to counter and deter any foreign direct investment especially to alleviate poverty and improve social services, which is actually good for me to advance my plans to explore opportunities that are available. It’s regrettable that all they want is for us to be subsistence farmers and fishermen and maintain our current status quo,” he said.

He also accused the Morrison government and the ABC of being part of a campaign to turn his people against him.

“I am aware that Australians are working behind my back to have my people not to support any foreign direct investment. Recently they have funded an awareness team to promote Australian interest against any foreign investment along the coastline of South Fly including Daru Island,” Yoto said.

However, strategic experts believe that the proposal faces significant challenges.

The Lowy Institute’s Pacific program director, Jonathan Pryke told The Australian: “Western Province has immense development challenges, including some of the worst TB (Tuberculosis) in the world, so you can see why these opportunities sound appealing.”

“But frankly they are too good to be true,” Pryke said.

“It seems the strategy is to try and get a politician of some level to sign off, generate enough attention around it that Beijing notices, and hopefully something will come out of it that gets the money flowing,” he said.

The World Health Organisation declared Daru a hotspot for drug-resistant Tuberculosis after an epidemic broke out in 2016.