The Bank of China (BOC) has opened a representative office in Papua New Guinea (PNG), its first branch in the South Pacific island nation, amid intensifying competition between the United States and China.
The launching ceremony was attended by BOC chairman Ge Haijiao and PNG leader James Marape on June 1. The new office is located in the PNG capital Port Moresby, according to the Chinese state-owned bank.
BOC’s chairman said the new office signifies “a concrete practice” in implementing Chinese leader Xi Jinping’s plan to build “a higher-level and more mutually beneficial comprehensive strategic partnership” with PNG.
He affirmed the bank’s commitment to strengthen the construction of a collaborative service network in the South Pacific region, deepen China-PNG economic cooperation, and co-construct the Belt and Road Initiative.
In his speech, Marape emphasized that his country welcomes friendships with all and harbors no enmity towards any. He made it clear that PNG will not compromise such values under any circumstances.
“Chinese companies, the Chinese government, and Chinese people have been important partners for our progress in the last 48 years,” he said, highlighting PNG’s growing trade with Beijing.
“We hope this bank is able to not just entrench but facilitate ease of transaction between two peoples, two countries,” Marape added.
PNG has four licensed banks, two of which are Australian-owned and have sought to reduce operations in the country.
Marape said that more than half of PNG’s 10 million population did not use banking, and most small enterprises were yet to migrate to the formal economy.
BOC’s announcement came after PNG signed a defense cooperation agreement with the United States last week to solidify their bilateral ties as the United States attempts to push back China’s influence in the Pacific.
The United States is seeking to increase security ties with PNG amid the fallout of an agreement between Beijing and the Solomon Islands that could see Chinese troops and weapons stationed in the region.
Secretary of State Antony Blinken, who signed the deal on behalf of President Joe Biden, said it would enable the United States to support PNG in building up its defense capacity and tackling illegal fishing.
Marape said there are still details of an operational agreement that need to be made, “such as how the defense force will operate, what they will do, and so forth.”
“This will happen after we have tabled the signed agreement and parliament decides on the needed details,” he said on May 30 in response to student protests against the accord.
Biden has also invited Marape to Washington for a second summit later this year, during which they will discuss various issues, including trade and economic ties and maritime security.
The Pacific nation, however, has delayed signing a proposed security treaty with Australia due to “certain wordings and provisions” that require consultation with domestic processes.
During his meeting with Australian Deputy Prime Minister Richard Marles in Seoul on May 30, Marape affirmed that PNG “in no way would compromise its excellent existing bilateral relations with Australia” and that his government was “capable of managing its sovereign affairs on its terms, systems, and processes.”
Australia and PNG already had strong security ties and have engaged in conflicts alongside each other. However, the two countries have never signed a formal security treaty.
The proposed treaty will enhance their partnership “by providing a legally binding framework for security cooperation across our many areas of mutual interest and contribute to bilateral and regional security, trust, and stability.”
Victoria Kelly-Clark and Reuters contributed to this report.