Plans for undersea communications cables are at a stalemate after the US warned of China's involvement, report says

• Plans for undersea communications cables have been shelved after security concerns over China.
• Reuters reported the US warned of a security threat with the cables connecting Pacific island nations.
• No contract was awarded as a result, and next steps for the project aren't yet clear.

The future of plans for undersea communications cables between Pacific Island nations are unclear after the US warned a Chinese company that was bidding for the project could pose a security threat, Reuters reported.

The $72.6 million project, which is backed by the World Bank, is designed to better connect the island nations of Nauru, Kiribati and Federated States of Micronesia, Reuters said.

But two sources told Reuters no contract was awarded after the US raised concerns over the involvement of a Chinese company.

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HMN Technologies, formerly known as Huawei Marine Networks, was one of three companies that submitted bids, the sources told Reuters.

Under the current plan, the cable would connect to Guam, a US territory that is home to key military facilities and it was this factor that raised concerns over the security of the project.

One source told Reuters no contract had been awarded because there was no other way to remove HMN as one of the bidders.

"Given there was no tangible way to remove Huawei as one of the bidders, all three bids were deemed non-compliant," Reuters quoted the unnamed sources as saying.

The World Bank told Reuters that it was working with the nations' governments to figure out what to do next.

It added: "The process has concluded without an award due to non-responsiveness to the requirements of the bidding documents."

And a Chinese foreign ministry spokesperson told Reuters: "As a matter of principle, I want to emphasise that Chinese companies have always maintained an excellent record in cyber security."

HMN Technologies did not respond to Reuters' requests for comment.