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PORT MORESBY, Papua New Guinea (July 6, 1999 - Radio Australia)---Papua New Guinea has agreed to the diplomatic recognition of Taiwan.

Radio Australia correspondent Richard Dinnen reported that "Papua New Guinea Prime Minister Bill Skate led a secret mission to Taiwan -- to raise the funds he needs to meet a critical budget shortfall -- and possibly to save his embattled Government."

Skate faces a no confidence motion in Parliament on July 13.

"Diplomatic ties will be established quickly," Dinnen said, "and Taiwan will provide financial assistance in the form of investments. An amount has not been announced.

"PNG has recognized China since 1975.

"This shift will outrage the Chinese Government. Their embassy here has said the deal is a threat to PNG-China relations.

"Australia too has expressed deep concern about the prospect of such a deal," Dinnen said.



PORT MORESBY, Papua New Guinea (July 5, 1999 - Radio Australia)---Papua New Guinea's Prime Minister and Foreign Minister have reportedly met Taiwan's President and Premier in Taiwan, in a move which may see PNG recognize Taiwan.

Two Taipei newspapers have reported that PNG Prime Minister Bill Skate and Foreign Minister Roy Yaki met President Lee Teng-hui and Premier Vincent Siew over the weekend.

The newspapers, quoting unnamed sources, said that an initial plan would see both sides announce the establishment of formal ties.

In Port Moresby, a spokesman for Mr. Skate said the Prime Minister had not gone to Taiwan to beg for money, but loans and trade were discussed.

Media reports last week said Mr. Skate was seeking Taiwanese funds to boost its ailing economy.

Mr. Skate flew to Taipei on Saturday night after travelling to Cairns in Australia to visit his family.


PORT MORESBY, Papua New Guinea (July 5, 1999 - PACNEWS)---Papua New Guinea has told Australia to mind its own business as it tries to secure much-needed loans from Taiwan in return for diplomatic recognition.

Australia’s Foreign Minister Alexander Downer said last week the move would not be in Australia or PNG's interests, and could jeopardize Australia's relations with the People's Republic of China.

However, a spokesman for PNG Prime Minister Bill Skate said it was an issue between PNG and Taiwan.

The spokesman confirmed that Skate and Foreign Minister Roy Yaki are currently in Taipei exploring the possibility of establishing diplomatic relations with Taiwan.

He said they were not only visiting Taiwan to seek funds but also to discus trade issues.

He also said the trip had been approved by the PNG Cabinet.


CANBERRA, Australia (July 5, 1999 - PACNEWS)---Taiwan’s Foreign Minister Jason Hu has angrily condemned moves by Australia to stop Papua New Guinea from setting up diplomatic ties with Taipei.

Hu said Taiwan will not engage in dollar diplomacy, but his country can talk to another wanting to set up diplomatic ties with Taipei.

He said it was understandable that Australia had its own voice in PNG, but it was not acceptable to Taiwan.

Australia’s Defense Minister, John Moore, said on Friday that Canberra feared a possible move by PNG to switch diplomatic recognition from Beijing to Taipei could infuriate China and undermine regional stability.

Moore urged the PNG Government to rethink its controversial plan to launch diplomatic ties with Taipei in return for soft loans.

Beijing views Taiwan as a renegade province and wages a constant battle to stop countries from switching formal diplomatic recognition of China to Taipei.

In the Pacific Islands region, Taiwan is recognized by Nauru, the Marshall Islands, the Solomon Islands and Tuvalu.

Earlier this year, Tonga switched its diplomatic relations from Taipei to Beijing.

"I think we have a clear policy," Moore said.

"We recognize one China and I don’t believe that an action such as that would neither be in our interest nor PNG’s. I think it would be better if the PNG Government rethought that one."

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