Morrison courts PNG with $250m power pledge in China pushback

Scott Morrison has pledged an extra $250m towards electricity projects in PNG during talks with the country’s leader.

Prime Minister Scott Morrison with the Prime Minister of Papua New Guinea, James Marape, during a joint press conference at Parliament House in Canberra. Picture: Gary Ramage

Scott Morrison has pledged an extra $250 million towards electric­ity projects in Papua New Guinea during talks with the country’s leader, James Marape.

The announcement ramps up the government’s push to protect PNG and Pacific neighbours from predatory Chinese lending.

The energy-funding commitment comes as China pushes PNG to approve a $1.25 billion power plant linked to Xi Jinping’s Belt and Road Initiative, which PNG’s state electricity utility warned would send it bankrupt.

The Prime Minister and Mr Marape — who is on a five-day “guest of government” visit to Australia — agreed yesterday to elevate the bilateral relationship to a “comprehensive strategic and economic partnership”, boosting security co-operation, investment and trade links. But offshore processing on Manus Island remains a thorn in the relationship, with Mr Marape failing to secure a commitment from Mr Morrison for a firm timetable to get refugees and failed asylum-seekers out of PNG.

Amid growing Chinese influence across the region, Mr Morrison vowed to help PNG and other Pacific nations to remain “as independ­ent and as sovereign and as much in charge of their future as they possibly can be”.

The $250m commitment to power projects on the Ramu grid — PNG’s biggest — will be provide­d in grants and soft loans, and is likely to include a new gas-powered plant at Hides, in Mr Marape’s home province of Hela.

Mr Marape said last week that he wanted to see refugee processing in his country end “as soon as possible”, and had asked Home Affairs Minister Peter Dutton to “expedite” the matter.

He reiterated the call yesterday, saying a schedule was needed to deliver “full closure of the entire asylum processes”.

“It’s a work in progress for us,” Mr Marape said. Manus province governor Charlie Benjamin said it was Australia’s responsibility to bring an end to offshore processing in PNG.

“The onus is really on Australia, because (the refugees) don’t want to live in Papua New Guinea,” Mr Benjamin said.

Mr Morrison said substantial progress had been made in closing the Manus detention centre and getting refugees off Manus Island, with only about 300 remaining from an initial 1353.

“I don’t think anyone is suggestin­g that they should have some sort of permanent or even temporary residence privileges in Papua New Guinea, who is a signatory to the convention, or indeed Australia,” Mr Morrison said.

The electricity commitment follows Australia’s pledge at APEC, with the US, New Zealand and Japan, to roll out power and internet to 70 per cent of Papua New Guineans. At the time, the announcement was seen as a major pushback by the region’s traditional powers against China.

But The Australian understands China’s Shenzhen Energy Group has in recent weeks renewed its push for PNG to agree to a proposed $1.25bn, 180MW hydro plant in Eastern Highlands Province, which PNG Power warned was too expensive and would pose an unacceptable risk to the utility.

Mr Morrison and Mr Marape also signed off yesterday on a $136m agreement for a new long-term policing support program for PNG, an extra $54m for rural health programs, $10m for child immunisations, and up to $15m a year to fight multi-drug resistant tuberculosis, which is rampant in PNG’s Western Province near Australia’s Torres Strait Islands.

Mr Marape’s trip follows unease­ within Australia’s strategic community that Australia was failing to roll out the red carpet often enough for key Pacific partners­, while China lavished region­al leaders with regular state visits to Beijing.