Australia to create Pacific infrastructure fund in bid to counter China

Scott Morrison has already hit the campaign trail in Queensland

Australia will spend £1 billion on infrastructure projects in Pacific nations as it seeks to counter growing Chinese economic influence in the region.

Morrison said Australia will create a A$2 billion infrastructure fund that will invest in telecommunications, energy, transport, water projects.

There are also plans to strengthen Australia's defence and security ties with Pacific islands through joint exercises and training.

Foreign policy analysts told Reuters the new infrastructure fund will test Australia's already cool relations with China, its largest trading partner. "My government is returning the Pacific to where it should be - front and centre of Australia's strategic outlook".

"This is our patch". She met her Chinese counterpart Wang Yi, who on a visit to Papua New Guinea last month said China would "never" interfere in local matters. "We are connected as members of a Pacific family".

Morrison said Australia would also expand its diplomatic presence in the Pacific, posting staff to Palau, the Marshall Islands, French Polynesia, Niue and the Cook Islands.

Still, the change of emphasis into the Pacific for Australia may not be sustained.

A further $US700 million will go to state export financing agency Efic, to support Australian businesses operating in the Pacific.

China has spent $1.3 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 nations could end up overburdened and in debt to Beijing.

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A new Pacific facility is to be established at the Australian Institute of Police Management to train Pacific police leaders.

He said the ship could assist with preparation for and response to natural disasters and other resiliance support. "And sadly I think too often we have".

Morrison is set for meetings with world leaders next week at the East Asia Summit in Singapore and Asia-Pacific Economic Cooperation in Papua New Guinea.

But Mr Morrison attempted to play down suggestions that the new measures in the Pacific were aimed at China.

But amid a growing trade spat between the USA and China, Payne's visit was an opportunity for Canberra to leverage its economic relationship.

While the Pacific has traditionally been seen as Australia's diplomatic turf and is the biggest recipient of foreign aid from Canberra, China has been increasing loans to small, indebted Pacific island nations.

The two countries have endured turbulent ties following Canberra's introduction of laws late past year to curb foreign interference - measures that were seen as aimed at Beijing.

It is rare for foreign officials to publicly chastise China over its human rights record during a visit to the country.

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