The U.S. signed a new security pact with Papua New Guinea on Monday as it competes with China for influence in the Pacific.

Papua New Guinea’s location just north of Australia makes it strategically significant. It was the site of fierce battles during World War II, and with a population of nearly 10 million people, it’s the most populous Pacific Island nation.

The State Department said the new agreement provides a framework to help improve security cooperation, enhance the capacity of Papua New Guinea’s defence force and increase regional stability.

“The work that we’re doing together to try to shape the future could not be more important, could not be more timely,” U.S. Secretary of State Antony Blinken told reporters.

Papua New Guinea Prime Minister James Marape said the pact is mutually beneficial and “secures our national interests”.

But the agreement sparked student protests in the second-largest city, Lae. And many in the Pacific are concerned about the increasing militarisation of the region.