New Solomon Islands PM to Pursue Cable Offered by Australia

Delivering his speech after the announcement of his victory as the new Prime Minister following a secret ballot vote election in parliament yesterday, Mr. Rick Hou said he will continue to push for the submarine cable project under a new deal offered by Australia.

The new arrangement which was initially announced by former Prime Minister Manasseh Sogavare will see a new company take over from Huawei to pull the submarine cable from Sydney to Honiara.
The new arrangement is said to be just a quarter of the price offered by Chinese company Huawei as all upfront costs are to be taken up by Australia.

The Undersea Cable project was identified as one of the reasons behind the downfall of the Sogavare-led Democratic Coalition for Change Government (DCC), since the new deal with Australia did not go down well with some former members of the cabinet.

The project was one of the major undertakings of the DCC but has been delayed due to some external factors, particularly the involvement of Australia and Huawei.

However, the fall of the DCCG has cast doubts on the fate of the project but the newly elected Prime Minister Hou assured in his speech outside of parliament that he will remain committed to the new arrangement with Australia in pursuing the project.

The Government initially signed an agreement with Huawei to carry out the cable project from Sydney to Honiara but it was rejected by Australia for security reasons. This forced the former Prime Minister Sogavare to consider other options, even pulling the cable from Indonesia.

Mr Sogavare told parliament during the Motion of No Confidence against him that the new investors have already sent in their letter.

The cable was to be pulled from Sydney to Honiara before Australia intervened to halt the project because it would be carried out by Huawei.

Around the same time, Australian media reports emerged about alleged bribery involved in the Sogavare government agreeing to give Huawei the contract.

Huawei said the allegations had no basis in fact, and that it had never given, implied, nor promised any political donations in relation to the project.

Mr Sogavare had stated when touching on the project in his response to the motion of no-confidence in Parliament that, “We are a family of nations in the region. We respect the sovereignty and security concern of our neighbors. We don’t do things that will affect their security”.

Australia's minister for International Development and the Pacific, Concetta Fierravanti-Wells, has welcomed the announcement by Solomon Islands' new prime minister and spoke with journalist Koroi Hawkins of Radio New Zealand about the new cable project which will also connect Papua New Guinea:

CONCETTA FIERRAVANTI-WELLS: We have been in discussions with the Solomon Island government over the past few months. We do welcome the new government's support for this project as has been expressed by the incoming prime minister and we can now continue to work with the Solomon Islands in our planning. And can I just say Australia and Papua New Guinea are working with the Solomon Islands to lay this cable at the same time.

KOROI HAWKINS: Now between Solomon Islands and Papua New Guinea you will be footing quite a big bill. Where is that funding going to come from and is it money well spent?

CF-W: Well we of course, Australia, will provide the majority funding for this cable and we will also as a first step be using about 25 million dollars (US$20M) of our overseas development assistance to fund the initial consultation work with PNG and an experienced Australian telecommunications company which has experience in the management of undersea cable projects. So, we have been working with PNG and looking at a number of and a range of options and funding models in this area for a number of years. And PNG of course does have an existing underwater cable connection to Australia but it has become clear in recent years that this cable has reached its end of life use and therefore requires upgrading and therefore we believe that this investment will not only reduce the amount of debt that will be required by both the Papua New Guinea and the Solomon Islands government but it will also provide faster cheaper and more reliable telecommunications needs as well as respecting the sovereignty of both countries.

KH: Just going a bit wider with the wider geo-politics of the region with the current US administration's Indo-Pacific Region focus is any of the funding for some of this or is any of the strategic influence for this position, taking into consideration that the Australian government probably wasn't as involved in the previous moves by especially Solomon Islands for an undersea cable, is any of this coming from the United States?

CF-W: Look we have a very important objective in our region. Australia has indicated that it will be stepping up its engagement in the region and as part of that step engagement we have we are working regionally and bilaterally with different countries as to how we can better integrate into the Pacific Islands economically, security wise and strategically. After the defense of Australia, the stability security and prosperity of our region is vitally important and so it is in, very much in Australia's interest to have a well-connected both Papua New Guinea and a well-connected Solomon Islands with more development friendly IT infrastructure which in turn will have a much stronger and more positive impact on the long term economic trajectory of both countries.

KH: Do we have a timeline on the current projects any figures on the costs and maybe contractor announcements?

CF-W: Well I think at this stage the first step will be to use overseas development assistance funding to work in consultation with the countries and to work with both countries in relation to this issue. Now we have entered into discussions with a significant Australian telecommunications company which is experienced in the management of undersea cable projects. For reasons of obviously commercial confidentiality we are unable to name the company at this stage but we hope to do so in the future when we have proceeded and had further discussions with Papua New Guinea and with the Solomons but of course the selector, provider and any work that is undertaken will be undertaken in accordance with our own procurement rules.

KH: Just what you said about working with PNG to help Solomon Islands. Is it the case that this cable project is going to go Australia, PNG, Solomons as opposed to Solomons Sydney?

CF-W: Well I think at this point in time that’s some of the technical things that are being looked at. We have been discussing a range of options and funding models in relation to this for some time but we see that there are significant efficiencies from implementing both cables at the same time and therefore what I said earlier reduce the costs that would have been involved in two separate parallel projects as both countries had been contemplating previously. So we see this project as representing the best opportunity to not only deliver an international telecommunications standard to both the countries but also provide both economic and development benefits for both countries as well.

Adapted from: Solomon Star News & Radio New Zealand

ANALYSIS: The long-running saga of bringing the first fibre optic connection to the Solomon Islands continues. Domestic political wrangling initially dogged this project and has now become a regional political issue.

US$20M of Australian overseas development funding, however, will not be sufficient to build a 4,000km submarine fibre optic cable from Sydney, Australia to Port Moresby, Papua New Guinea, and on to Honiara, Solomon Islands. The amount of this funding would cover a desk top study but may not even be sufficient for a marine survey.

It is worrying that the Solomon Islands politicians are assuming that the Australian government has offered to pay the entire cost which would be in the region of US$120M. When reality hits them, this project is likely to be put on hold again.

Furthermore, co-ordinating between the governments of the Solomon Islands and Papua New Guinea has proven difficult in the past because of regional rivalries and domestic vested interests. The Australian Government may find that, although there are clear cost savings from building one cable to serve both locations, in practice it may be easier to implement a two-cable solution.

​In the meantime, the people of the Solomon Islands are not able to reap the economic benefits that a submarine fibre optic connection has been proven to bring to lesser developed nations.