China signs 200 million dollar MOU with Papua New Guinea

[Monash]

From the ABC. Last month, Papua New Guinea signed a memorandum of understanding to build a $200 million "comprehensive multi-functional fishery industrial park" on Daru Island. The MOU was signed by the Fujian Zhonghong Fishery Company (with Chinese Government backing) .This is on top other multi-billion dollar low interest 'loans' and investment in the region of over the past few years. According to Australian sources there are no commercial valuable fishing reserves in the area. The 'Industrial Park' is to be build on Daru Island which is the located just off the PNG coast on its side of the border with Australia in the Torres Straight.



Any guess on how long it will be before the fishing plant is expanded for 'other options? And this is on top of mounting trade pressure via breaches of its Free Trade Agreement with Oz which are devastating our exports to China (all except the one they' cant do without (iron ore - funny about that). We now face more pressure to reinforce our presence/influence in PNG than never before. We're also now in a frantic rush to broaden our export markets, even though this will take years. China is hitting us with both barrels recently - apparently in order to send a message the rest of the world that 'this is what will happen to you don't pay ball with us'.

It will be interesting to see how the Australian Government handles this project. The straight is just too strategically important to Australia to ignore it.

 

[hboGYT]

Meh, we'd probably lose a lot of business anyway because China' phase one trade deal with the US. Interesting to see how the trade war continues into the Biden administration. Surely they will try not to let any of their allies get picked off by China.

 

[Monash]

Meh, we'd probably lose a lot of business anyway because China' phase one trade deal with the US. Interesting to see how the trade war continues into the Biden administration. Surely they will try not to let any of their allies get picked off by China.

Not really the big ticket items we supply coal to China are coal, iron ore, educational services and agricultural products (wine, wheat, wool, beef & sea food etc). In most of these we have a competitive advantage over the the US. In the case of the rest (things like wine and education) the US already has access to the Chinese market. I also don't see Binden changing tack on current US policies re; China. This is for two reason (1) it will play well with traditional Democrat voters who are concerned about China's human rights record & (2) for once Republican and Democrat policy interests will more or less be in be in sync on a topic!, albeit for different reasons with Republican concerns leaning more towards trade practices than human rights.

I suspect Australia will be having very intense (behind closed doors) discussions with friendly, pro-democratic nations regarding the economic/political implications of China's current trade stoush with Australia and the potential flow-on impacts on any other trading partner that upsets them in the future. We also have a fight brewing the WTO. So the question becomes what will China do next if, as seems likely the WTO finds in our favor, albeit that would be a couple of years from now.

As far as the 'fish processing factory' is concerned I think it has a two fold purpose. One is to send another shot across the bows to Canberra in the current Political dispute (we have reach, beware). The second is that there's no downside to the deal for them. If it comes off they have a potential base on our doorstep. If it doesn't, well it hasn't cost them anything but it will cost us something because we have to invest further political and financial capital in PNG in order to hose the deal down. Hopefully Oz will also be getting the US government to apply pressure. The US Navy will NOT want China having access to a port and refueling facility in that location, especially if the 'plans' include a proposal for a runway so 'fresh sea food' can be flown directly to China.