An K331 million undersea cable linking Papua New Guinea, Solomon Islands and Australia is expected to be up and running by the end of 2019. It follows concerns by Australian officials that if China’s Huawei telco built the project, it could access Australia’s telecommunications infrastructure, creating national security concerns.

Map of the proposed undersea telecommunications cable. Source: Vocus

The Coral Sea Cable System will connect Solomon Islands’ capital, Honiara, with Port Moresby and Sydney via a 4000-plus kilometre fibre optic cable, replacing PNG’s and Solomon’s reliance on old, unstable and expensive technologies.

Final design and construction will take 18 months, with Sydney-based telecommunications company, Vocus, managing the A$136.6 million (K331 million) project.

Vocus is currently finalising the construction of a new submarine cable system, linking Australia to Singapore.

Earlier this year, Vocus carried out a three-month scoping survey for the project, which includes constructing a domestic submarine cable network in Solomon Islands, linking Auki in Malaita Province, Noro in Western Province, and Taro in Choiseul Province with Honiara.

Efficiencies

Linking the three countries in one project provides a lot of efficiencies in design, construction and procurement, an Australian Department of Foreign Affairs and Trade (DFAT) spokesman told Business Advantage PNG.

The first step will be to appoint a marine vendor, who will build and install the cable after it confirms the precise route. Local companies in PNG and Solomons are expected to be involved in the building of local landing points.

Australia will majority-fund the link using up to A$200 million from its overseas development assistance fund, with financial co-contribution from both Solomons and PNG.

‘The message from Australia is twofold.’

The Solomons government originally awarded the contract to the Chinese company Huawei, in a move that prompted Australian intelligence and security chiefs to warn the Australian government against the deal, who said it would refuse a landing point in Australia.

Message

BuddeComm telecommunications analyst Henry Lancaster told Business Advantage PNG the message from Australia is twofold: ‘Letting the other ‘Five Eyes’ (the US, UK, NZ and Canada) know that they are on board on perceived security issues, and (belatedly) giving an indication both to island groups and the Chinese that they retain a material presence in Oceania’.

‘China is increasingly the dominant force in many affairs across Australia’s backyard, and the Australian government wants to be seen to be stepping up to the plate,’ says Lancaster.

‘Boosting connectivity in PNG and Solomon Islands will drive economic growth.’

‘Cheap vendor loans and other economic help have placed many of the small island countries at China’s mercy, increasingly in debt financially and economically.’

The Director of the Pacific Islands Program at the Lowy Institute, Jonathan Pryke, told the ABC: ‘Having a Chinese state-owned enterprise connecting up to a piece of critical domestic infrastructure is pretty unpalatable for the Australian Government.’

Economic benefits

Australian Foriegn Minister Julie Bishop. Source: Australian Federal Government

The economic benefits of the Coral Sea Cable System are clear, according to Australian Foreign Minister, Julie Bishop.

She claimed that boosting connectivity in PNG and Solomon Islands will drive economic growth, and improve governance and security.

‘World Bank research estimates improved internet access and connectivity could grow GDP by more than US$5 billion (K16.2 billion) and create close to 300,000 new jobs in the Pacific by 2040,’ Bishop said in a statement.

It will reduce telecommunications costs in Solomon Islands, which is solely reliant on satellite technology.

The Solomon Islands Chamber of Commerce and Industry Chairman, Jay Bartlett, has welcomed the deal with Australia, and has stressed the significance of the cable investment and the positive impacts it will have on the economy, growth, investment and the private sector.

‘Among many benefits, the cable will boost the country’s internet speed connection, lead to cheaper internet rates, make it easier for more investment opportunities, and of course potentially create more jobs and opportunities for Solomon Islanders when businesses are thriving and expanding their investment frontier.

‘For businesses it will also improve productivity and reduce wastage in time and costs.’

Pablo Kang, the man leading the task force to implement the undersea cable for Australia’s Department of Foreign Affairs and Trade, will be a guest speaker at the Business Advantage Papua New Guinea Investment Conference at the Sofitel Brisabane on 6 & 7 August 2018.

For further information, visit www.pnginvestmentconference.com.