The Papua New Guinea Government says Australia has nothing to fear from increasing Chinese influence in that country and in the wider Pacific region.

The Australian Government is becoming increasingly alarmed about Chinese investment and aid to developing countries on its doorstep.

But in PNG, a former Australian colony, businesses and the government say it's clear that Australia will have to live with China's new role as a regional power.

Australian investment in PNG has stagnated in recent years as the country's economy has struggled, but Chinese investment has been rising.

