APEC Surprise: U.S. To Join Australia In PNG Naval Base On Manus

The United States has stunned many in the Pacific, announcing it will partner with Australia in developing a joint naval base in Papua New Guinea.

The revelation was delivered during a stinging speech by American Vice President, MIke Pence at the APEC Summit, warning pacific nations not to accept over-burdensome loans from China -- loans often sneeringly referred to as 'debt diplomacy.'

"Today it's my privilege to announce that the United States will partner with PNG and Australian on their joint initiative on their base on Manus Island," he said.

Prime Minister Scott Morrison earlier foreshadowed the announcement in an earlier speech, "Australia is stepping up. We will step up. [We are] stepping up to a whole new level."

US Vice President Mike Pence arrives in Port Moresby for the Asia-Pacific Economic Cooperation (APEC) Summit. IMAGE: Getty Images

The Lowy Institute's, Jonathan Pryke said the base played a huge roll for Allies during World War Two and could once again in the future.

"It was a huge U.S. military base with a personnel of 37,000 people and anchorage for 260 ships and facilities the same size as Pearl Harbour. It really was the South Pacific hub for the U.S. Army and Navy.

"It really pushes America far further south in the Pacific than we have seem them come in decades. We have a small complement of rotational Marines in Darwin, paring them with the naval base really pulls them into our region."

He acknowledged the announcement would likely anger China.

"I think they will see it with frustration. China would see this as an affront to their strategic ambitions in the Pacific region.

READ MORE: Manus Refugees 'Shunted Out Of Hospital' As PNG Prepares For APEC

They are clearly looking to set up some form of military presence somewhere in the Pacific and this cuts them off from doing that at Manus Island."

The move could also bring America's super-sized fleet closer to islands China has militarised in the South China Sea, and defuses speculation America --Australia's chief ally -- was slowly withdrawing from the region.

The U.S. Vice President also told the audience he had come with a message from President Trump on trade and foreign loans.

"The United States has an in-principal approach that stands in stark contrast to some other nations," he warned.

US Vice President Mike Pence delivers his keynote speech at the CEO Summit of the Asia-Pacific Economic Cooperation (APEC) summit in Port Moresby. IMAGE: Getty

"Too often they [the loans] come with strings attached and lead to staggering debt.

"Do not accept foreign debt that could compromise your sovereignty," Pence said.

Scott Morrison said Australia was open to working with "all partners" in the region, as long as the partnerships were transparent, non discriminatory and avoided unsustainable debt burdens.

As for Papua New Guinea, "Our relationship goes deep, very deep because it's based on real values and real connections and that's why we will always be here."

He did though subtly criticise the US President saying, "Tit for tat protectionism and trade wars are in no ones best interests."

The summit continues on Sunday.

Featured image: Getty

Contact the author jlea@networkten.com.au