President Joe Biden speaks at the White House in Washington
U.S. President Joe Biden announces that he will be cutting his upcoming trip to Asia short and will return to Washington earlier than planned, to continue U.S. debt ceiling negotiations, during his remarks at a Jewish American Heritage Month celebration at the White House in Washington, U. Reuters

U.S. President Joe Biden's cancelled visit to Papua New Guinea, which had declared next Monday a public holiday in honour of his arrival, has dealt a blow to U.S. credibility in the Pacific island region, analysts said on Wednesday.

Biden's planned visit to a nation of 9 million just north of Australia had been viewed as a major step to build trust in a region where China has sought a greater security presence.

An unfolding crisis over the U.S. debt ceiling prompted Biden to postpone plans to visit Papua New Guinea and Australia, cutting short an upcoming Asia trip so he can return to Washington.

"For Papua New Guinea this was a very big deal and they will be disappointed," said Mihai Sora, a Pacific islands analyst with the Lowy Institute think tank in Sydney.

The cancellation was also a "blow to U.S. credibility in the region as a consistent partner", he added.

"Up until now Pacific islands leaders have been giving the U.S. the benefit of the doubt over its ability to re-engage."

Papua New Guinea Prime Minister James Marape told a radio audience a day earlier that his government was preparing to sign a major defence pact with the United States and a security agreement allowing U.S. Coast Guard vessels to patrol it waters. He made no public comment about Biden's cancellation.

Some Opposition party politicians had criticised the pact as potentially upsetting China, a major infrastructure donor.

Biden had also been scheduled to meet 18 Pacific island leaders in the three-hour visit to the PNG capital Port Moresby.

Asia Society Policy Institute senior fellow Richard Maude said the cancellation of what would have been the first visit by an American president to an independent Pacific islands nation could be a setback for relations.

"The mantra in the region is all about turning up. Turning up is half the battle. China turns up all the time, and so the optics aren't great," Maude, a former Australian intelligence chief, said on Wednesday.

The visit also had a personal dimension for Biden. Two of his uncles were based in PNG in World War Two as airmen, including one who died in a plane crash in 1944, Biden recalled in 2016.

The Pacific islands span 40 million square km of ocean, where vital sea lanes and submarine cables link the United States to its allies Australia and Japan. But leaders there had complained to the U.S. of being seen as "fly over" countries.

Chinese President Xi Jinping has visited the region three times, including a 2018 visit to PNG.

Beijing last year struck a security pact with the Solomon Islands, where a Chinese state company will rebuild the international port. China has continued to lobby for a bigger role in the region, after failing to sign 10 nations to a security and trade deal.

Indian Prime Minister Narendra Modi will meet Pacific island leaders in Port Moresby on Monday, and New Zealand Prime Minister Chris Hipkins said he will also travel to PNG.