Australia fires Tomahawk missile for first time, spends $140m to China-proof Nauru

Australia will be able to use a new treaty to block China and other countries from striking any security or telecommunications deals with Nauru in exchange for $140 million in financial support from Australian taxpayers to the tiny Pacific island.

The Commonwealth Bank of Australia will also provide banking services to Nauru as part of the pact, revealed by this masthead last week, removing fears that a Chinese state-owned bank could swoop in and establish financial dominance on the island.

Nauruan President David Adeang and Prime Minister Anthony Albanese said the new treaty was a historic moment in the countries’ relationship.Credit: Alex Ellinghausen

The announcement came as the chief of Australia’s navy, Mark Hammond, revealed it had for the first time test-fired a Tomahawk missile off the US west coast last week in a significant ramping up of the Australian Defence Force’s long-range strike capability.

In a previously secret exercise, the navy fired one of the missiles, which can reach as far as 2500 kilometres, from a Hobart-class destroyer, hitting a land target on a US military range near San Diego, California.

The government has said it is necessary to increase Australia’s long-range strike capability because of challenges to the rules-based order in the Indo-Pacific, including through China’s rapid military build-up and aggressive actions in the South China Sea.

Australian policymakers were alarmed earlier this year when Nauru abruptly switched diplomatic recognition from Taiwan to Beijing, prompting intense efforts to entrench Australia’s status as the nation’s primary security partner.

The speaker of Nauru’s parliament, Marcus Stephen, travelled to Beijing for meetings with Chinese officials last week, with the Chinese government expressing its desire to work with Nauru to protect its “national sovereignty, security and development interests”.

The announcement comes before confirmation later this week that a Papua New Guinea team will join the National Rugby League in a deal that will cost Australia $600 million over 10 years.

“This treaty will make our region stronger and it will make it safer,” Prime Minister Anthony Albanese said at a joint press conference with Nauruan President David Adeang in Canberra on Monday.

“This is a good day for Australia, this is a good day for Nauru and it is a good day for the security and resilience of the Pacific region.”

Adeang described the treaty, which will have to be ratified by both nations’ parliaments, as a “historic milestone” that would help lift up the population of Nauru, ranked the fifth most vulnerable in the world by the United Nations.

This masthead reported earlier this year that Australian businessman Amit Gupta paid bribes to Adeang and other top political officials in exchange for favourable access to the country’s phosphate, which is used in fertiliser.

Adeang previously dismissed corruption allegations as “baseless claims”, and no charges have been laid over the matter.

Australian Federal Police have also investigated allegations that Nauruan officials have used Australia’s lucrative offshore processing subcontracts to enrich themselves.

With a population of 13,000 and a land size of 21 square kilometres, Nauru is the third-smallest nation in the world.

Albanese said that, under the treaty terms, Nauru and Australia would jointly agree to any engagement with other countries in Nauru’s security and telecommunications sectors.

Third parties would not be able to use Nauru’s critical infrastructure for security purposes under the agreement.

The government struck a similar deal with Tuvalu last year in a treaty that requires the Pacific nation to consult Australia before striking any security arrangements with other countries.

In exchange for sacrificing its sovereignty over security, Australia will provide Nauru with $100 million over five years for education, health and social services.

Australia will also provide $40 million over five years for Nauru’s policing and security.

As part of the deal, CBA will begin banking operations in Nauru next year, when the Bendigo and Adelaide Bank exits the island.

Sources familiar with the deal said CBA had agreed to enter Nauru after being asked to do so by the federal government in the national interest, rather than as a commercial decision.

Mihai Sora, an expert in Pacific affairs at the Lowy Institute, said the treaty was the product of “intense negotiations” over two years.

“Obviously, China’s continuing push into the security and critical infrastructure sectors was the key motivator for Australia,” he said, adding that Nauru badly needed economic support from Australia.

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