12 Apr 2019

Vanuatu's Luganville wharf "geopolitically risky" - report

2:47 pm on 12 April 2019

American researchers have raised fresh concerns about the geopolitical risks of Vanuatu's Luganville wharf.

A new report has built on security fears reported last year that the wharf could be used as a naval base by China.

HMAS Huon docked at Luganville on Espiritu Santo.

HMAS Huon docked at Luganville on Espiritu Santo. Photo: RNZ/Koroi Hawkins

The concerns came in a recent review of China's Belt and Road initiative by researchers at thinktank the Center for a New American Security.

Scrutiny of the China-funded wharf revamp in Luganville last year prompted Vanuatu to strongly deny reports it could be taken over by Beijing.

Vanuatu's government was compelled to disclose there was no debt-swap agreement in the deal.

But the Belt and Road report, released earlier this week, said the arrangement was still nontransparent, locally disengaged and geopolitically risky.

It added the wharf, which involved a $US80 million loan from China, was financially unsustainable because of Vanuatu's already-high debts levels to China and the relatively high interest rates it paid on other loans.

Opening of new wharf in Luganville on Santo.

Dignitaries gathered for the opening of the controversial wharf at Luganville on Espiritu Santo. Photo: Len Garae