Australia will offer a A$600 million ($430 million) package to combat drug smuggling in the region at a meeting of the Pacific Islands Forum in Palau, including funds for enhanced aerial surveillance and more training for police and border officials.

"The Pacific is our home and our family. That’s why it’s in Australia’s interests to work with our Pacific partners to combat organized crime," Australian Prime Minister Anthony Albanese said in a statement.

"For the good of every country in the region, including our own – we need to work together to stamp out the illicit drug trade."

In a separate announcement, the US State Department said it will provide $150 million in funding to the region, including $60 million to help Pacific Islands countries address the global energy crisis by expanding fuel storage capacity and supporting grid stability.

Deputy Secretary of State Christopher Landau announced the funding at the forum that has so far been dominated by a spat over Taiwan's participation.

China, a major donor to the Pacific that views Taiwan as its own territory, has objected to the democratically run island's presence at the annual meeting of the 18-member forum.

Members Australia and New Zealand said on Tuesday the bloc would decide the guest list.

Palau, which is hosting this year's meeting, is among three Pacific nations that have maintained diplomatic ties with Taiwan. The meeting, which began on Aug. 30, will run to Sept. 4.

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