Australian Prime Minister John Morrison has dismissed as “speculation” reports that a Hong Kong-registered company plans to build an industrial city in waters close to Australia.
Australian media reported that Hong Kong-registered WYW Holding Ltd. plans to invest $30 billion to build a city near Australia’s maritime border with Papua New Guinea, including a seaport and industrial zone on Daru Island in the Torres Strait. Papua New Guinea is considered Australia’s “backyard. The report cited a letter from the company to the PNG government in April last year.
The Guardian reported on Feb. 5 that a letter written by WYW Holdings to the PNG government in April last year was leaked to the media last week. The letter proposed converting part of Daru Island into a business, commercial and industrial zone, as well as building a resort and residential area nearby.
In the letter to PNG Prime Minister James Marape, WYW Holdings CEO Terence Mo wrote that it would be a “privilege” to work with the PNG government to “create economic growth through infrastructure development. “.
The letter also reads that this “ambitious plan” is “proposed in an agreed sovereign guarantee based on a long-term BOT (Build Operate Transfer) contract. Importantly, the Build-Operate-Transfer contract would give WYW ownership of the project for a contract period, which could be decades.
Daru Island is 5 kilometers (3 miles) from Australia’s Sebai Island, about 200 kilometers (120 miles) from the Australian mainland, and has a population of 20,000.
In an interview with Sydney’s 2SM radio on Monday (Feb. 8), Morrison said, “I think it’s just speculation, to be honest.” He said it was “just people flying kites and I wouldn’t overreact to the noise that’s flying around out there.”
Morrison added: “I talk to the prime minister of Papua New Guinea (James Malapai) regularly, we have a very good relationship, he understands the importance of our relationship and our other partners very well, and I don’t think Papua New Guinea would be very rushed on something like this.”
Malapai’s office said the prime minister was unaware of the offer, but added that his government would not reject foreign investment that complied with Papua New Guinea’s laws and benefited locals.
Analysts say the Chinese proposal to build a city near Australia’s maritime border with PNG makes little economic sense, but there is instead the possibility of building a marina for naval use.
The United States and Australia are working together to redevelop the Lombrum Naval Base on Manus Island in northern Papua New Guinea to ease concerns about China’s growing influence in the region.
Last November, Papua New Guinea signed a memorandum of understanding with China’s Fujian Zhonghong Fisheries Company to invest $160 million in a fish processing plant in Daru.
Australian Home Affairs Minister Peter Duton said the government was closely monitoring the matter and hoped to discuss the Chinese proposal with the PNG government. He added that “Australia will always act in our best interests, and in support of our neighbors.”
Speaking to Australia’s Nine Network on Friday, Dutton said, “I think there are all sorts of sovereignty issues and there are some local issues in terms of landowners and land rights and so on that I think will pose significant obstacles.”
Papua New Guinea is Australia’s largest recipient of foreign aid and is considered Australia’s backyard. Under a treaty that recognizes the trade and Family ties that have existed between the Torres Strait island communities for thousands of years, PNG vessels can operate in a common fishing area between the two neighbors.
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