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Chapter Three: Asia and Africa

East Asia

Regional development indicators2

Country

GNP per capita
($A)

Access to water
(% of population)

Life expectancy (years)

Adult literacy
(% of population)

         

Indonesia

899

69

66

87

East Timor

471

48

57

47

Viet Nam

573

56

69

94

Philippines

1581

87

69

96

China

1209

75

70

84

Mongolia

542

60

67

63

Cambodia

403

30

54

39

Thailand

3037

80

73

96

Lao PDR

1798

90

54

48

Burma

-

68

60

85

         

Source: GNP per capita and adult literacy (1999): DAC; Access to water (2000): Global Water Supply and

Sanitation Assessment 2000 Report; Life expectancy (1998): Geographical Distribution of Financial Flows to Aid Recipients 1995-1999, OECD; East Timor: UN common country assessment `East Timor, Building Blocks for a Nation', November 2000.

Estimated total flows for East Asia in 2001-02 $551.6 million

Regional overview

Recovery from the East Asian financial crisis is progressing at different speeds. For some governments in our region, the tumult of the East Asian financial crisis has passed, but few countries can afford to be complacent in the face of a more complex and demanding international environment. This requires a two-pronged approach from the Australian aid program: to improve the social and economic conditions for the poorest and most vulnerable, and to assist governments in our region to strengthen their resilience to future economic shocks, especially in the wake of the slow down of the world economy. Australia is supporting a re-intensification of reform efforts, particularly strengthening financial markets, facilitating trade and improving government transparency.

Regional program

Allocation $29.4 million

Australia's regional program has two strategic priorities:

Australia's response to the East Asian financial crisis has been a priority for the Asia Regional Program. As the region emerges from this crisis phase, Australia will increasingly focus on regional governance and health. Governance activities assist regional governments to manage the impacts of globalisation and establish a firmer and broader basis for growth and poverty alleviation. This is achieved largely through sound economic management, international trade and economic integration and effective social protection programs to address the needs of the marginalised.

A $10 million regional initiative to combat people trafficking in South-East Asia will commence in 2001-02. People trafficking, and the attendant risks of increased money laundering, drug trafficking and the spread of communicable diseases, is a serious and growing development issue for the region. More than three and a half million women and children in the region are estimated to be victims of the sexual exploitation that drives much people trafficking.

HIV/AIDS prevalence rates in East Asia pose a serious threat to the long-term development prospects of the region, with current trends suggesting Asia may have surpassed Africa in new infections per year. In 2000, the region accounted for over 6 million cases of HIV/AIDS, with over 900,000 newly identified cases in that one year alone. In 2001-02, a new HIV/AIDS project will form a part of the Government's $200 million global HIV/AIDS initiative announced in 2000. The project will bolster ongoing efforts aimed at tackling the HIV/AIDS pandemic in the region.

As an active member of Asia-Pacific Economic Cooperation (APEC), Australia is committed to the delivery of a free and open trade and investment environment in the Asia-Pacific no later than 2020. Australia provides `ecotech' assistance that helps APEC developing member countries participate in the growth of the international economy. `Ecotech' or economic and technical cooperation focuses on six priority areas in the APEC context: developing human capital, developing stable, safe and efficient capital markets, strengthening economic infrastructure, harnessing technologies for the future, safeguarding the quality of life through environmentally sound growth, and developing and strengthening the dynamism of small and medium sized enterprises.

The Thailand-Australia Social Protection Facility is a $5 million APEC activity promoting the delivery of quality social services to the poor and vulnerable. The University of Mahidol in Thailand jointly manages the Facility with an Australian contractor. In addition, Australia is supporting other APEC-related activities that are assisting regional governments to bridge the `digital divide', improve quarantine capacity and remove barriers to trade.

The planned ASEAN-Australia Development Cooperation Program (AADCP) will enhance regional economic governance, integration and competitiveness. Key elements of the six year $45 million program will be a program stream, consisting of two large scale regional development programs, a flexible mechanism for smaller collaborative activities promoting joint ASEAN/Australian solutions to regional development challenges, and a policy research facility within the ASEAN Secretariat focusing on economic issues. The particular needs of the poorer `new ASEANs' will receive careful attention.

Bilateral programs

Diagram 10: Estimated total aid flows to East Asia by country 2001-02

Diagram 10:  Estimated total aid flows to East Asia by country 2001-02

Indonesia

Country program allocation $99.5 million

Estimated other flows $22.0 million

Estimated total aid flows $121.5 million

The objective of the Australia-Indonesia development cooperation program over the period 2001 to 2003 is to contribute to poverty reduction, sustainable economic recovery and democratisation in Indonesia. This objective recognises the complex nature of development in Indonesia during a period of reform and transition. A key element of this reform process is the decentralisation of the nation's political and administrative system. To achieve sustainable poverty reduction outcomes in a decentralised environment it is necessary to address both the direct and indirect determinants of poverty (lack of access to basic services, unsustainable livelihoods, community conflict) as well as governance issues (eg. skills shortages, poor policies, weak institutions) that are essential to ensure sustainable economic growth.

In 2001-02, two major initiatives to promote improved governance will commence. A Legal Reform Program will assist legal institutions to improve their effectiveness, transparency and accountability. The program will provide training and capacity building assistance for judicial and supervisory institutions and legal NGOs. The second phase of the Technical Assistance Management Facility will mobilise short-term targeted technical and training assistance to support economic and financial reforms in the public sector.

Meeting basic needs such as access to health care and water and sanitation facilities remains a major challenge in Indonesia and a priority for the aid program. New activities in health to commence implementation in 2001-02 will help strengthen HIV/AIDS and STD prevention and care, and improve maternal and neonatal health and planning services. Support will also be provided for decentralising health services to District Administrations and improving the operation and maintenance of rural water supply and sanitation systems.

In the education sector, Australia will expand activities in the area of basic education with a significant primary education assistance project that will increase the quality of learning and teaching. Short-term training to Indonesian government and non-government agencies in areas ranging from community development to good governance also remains a priority, as does tertiary training through Australian Development Scholarships.

East Timor

Country program allocation $30.0 million

Estimated other flows $91.8 million

Estimated total aid flows $121.8 million

The goal of Australia's aid to East Timor is to reduce poverty and build East Timorese capacity to govern a peaceful, democratic and independent East Timor. This will be achieved through:

The key sectors for Australia's aid to East Timor are education and training, health, rural development, water supply and sanitation, and governance.

The Australian program has a particular focus on building government and administrative capacity to assist the East Timorese to prepare for the handover of government responsibilities after independence. In 2001-02, targeted technical assistance and capacity building initiatives will include support for the development of effective budget management and taxation systems, the establishment of land administration systems, the provision of English Language Training and scholarships targeted at East Timor's highest priority skills needs.

Other activities will target vulnerable groups and those currently living with limited access to resources, particularly outside Dili, in recognition of the fact that 85 per cent of East Timor's poor live in rural areas. Australia will also commence longer-term development programs, including a rural development program which will increase food security and help re-establish rural livelihoods in three districts; a rural water supply project which will bring clean water to three districts; and an oral health care program which will help re-establish basic dental care throughout East Timor.

As part of Australia's commitment to a strong, stable democratic East Timor, Australia is providing training for East Timorese leaders and their support staff in democratic parliamentary processes. The aid program will provide support for a functional Parliament building and technical advice and training in preparation for elections scheduled for 2001.

Viet Nam

Country program allocation $60.0 million

Estimated other flows $13.3 million

Estimated total aid flows $73.3 million

Through its aid program, Australia is working in partnership with Viet Nam to reduce poverty in an equitable and sustainable way. The program is increasing Viet Nam's development capacity through training and education, and helping to improve the livelihoods of the rural poor through delivery of quality health, agriculture and infrastructure services. The aid program is also supporting the Government of Viet Nam's program of institutional and policy reform in the areas of private sector development, economic integration, effective use of public resources and the legal system.

In 2001-02, the program will develop and implement new activities in rural development, governance and education.

Improved rural water supply and sanitation will be provided to disadvantaged communities in seven provinces of the Mekong Delta. A major new project in Quang Ngai province aims to increase income generation for the rural poor. This project will include interventions in agriculture, rural infrastructure and vocational training.

Australia will establish a facility to allow swift and effective responses to existing and emerging governance issues, particularly in Viet Nam's priority areas of economic integration and public sector management reform. Australia will also provide funds to the Capital Aid Fund for Employment of the Poor (CEP). Australian assistance for a Microfinance Expansion Project will allow CEP to provide its financial services to an additional 15,500 clients from poor households.

In education, Australia and the World Bank will work together to increase the number of disadvantaged children who complete primary school, targeting the estimated half million who currently drop out each year. It is expected that 200 new scholarship places will be offered at Australian universities in 2001-02.

Philippines

Country program allocation $56.2 million

Estimated other flows $7.3 million

Estimated total aid flows $63.5 million

Australia's assistance to the Philippines aims to help reduce poverty and promote sustainable development. The program's geographic focus is the southern Philippines, including Mindanao. About one fifth of the nation's population and about one third of the nation's poor live in Mindanao. The new Arroyo administration has expressed its commitment to search for a peaceful resolution to the long running civil disputes in Mindanao. Australia is keen to support this effort through our aid relationship with the Philippine Government at the national and local levels, and to work with civil society to achieve improvements for poor Filipinos in four key livelihood areas: rural incomes, the environment, education and health.

In 2001-02, a new program of assistance will focus on four of the poorest provinces in the southern Philippines and Mindanao. New activities will support the Philippine Government's reform agenda through assistance with land reform and improving the policy and regulatory framework for water supply and sanitation.

The program will continue to assist vulnerable groups affected by reform and economic change through the $30 million Philippines-Australia Vulnerable Groups Facility. The facility reaches some 40,000 street and urban working children and around 17, 000 parents in 25 cities nationwide, and is helping over 520 village districts, or barangays, to fund local community development projects driven by grassroots initiatives.

China

Country program allocation $40.3 million

Estimated other flows $15.7 million

Estimated total aid flows $56.0 million

Australia's program of development cooperation with China focuses on four key sectors: governance, health, education and rural development/environment, particularly in the poorer central and western provinces of China. A key challenge is to assist China with the reforms underway in its transition to a market economy.

In 2001-02, a new Australian project in Xinjiang Province will help to limit the transmission of HIV infections and will introduce a comprehensive approach to caring for AIDS sufferers. A major project will be completed in Tibet, bringing clean water and better primary health care to around 17,000 people in 54 rural villages. Australia will also implement a new initiative in Chongqing Municipality to help China develop vocational education and training that better meets the needs of the workplace. Other new measures will address rural household poverty, develop water supplies for people in poverty-stricken areas and combat environmental problems such as desertification and soil erosion.

Australia continues to support the Human Rights Technical Cooperation Program, which underpins the annual human rights dialogue with China by providing assistance with the protection, promotion and administration of human rights. The program builds on earlier successful activities in areas such as legal reform, women's and children's rights and ethnic and minority rights.

Mongolia

Country program allocation $2.7 million

Estimated other flows $0.5 million

Estimated total aid flows $3.2 million

Australia is helping to strengthen the capacity of the Mongolian government to deliver long-term development, through assistance in areas such as financial reform and aid coordination. Australia is also working with the UNDP to help limit the spread of HIV/AIDS among Mongolia's mobile populations, and with the World Bank to provide better access to clean water for the poor areas of Ulaan Baatar.

Mongolia continues to face social and economic hardship brought on by two consecutive years of a natural disaster, the Dzud, in which droughts are followed by snowstorms, causing severe losses of livestock. Australian assistance for the purchase and distribution of emergency foods is being provided through the International Federation of the Red Cross.

Cambodia

Country program allocation $24.4 million

Estimated other flows $14.1 million

Estimated total aid flows $38.5 million

Australia is helping to reduce poverty in Cambodia and support the country's transition towards sustainable development. Australia's approach is based on improving agricultural productivity and profitability and strengthening Cambodia's capacity to meet basic human development needs. Institutional strengthening is concentrated in three sectors: education and training, agriculture and health. There is also a major activity in the criminal justice sector.

In 2001-02, a new program of support for agricultural research and development will boost rural incomes and improve food security by contributing to increased crop yields, improved produce quality and marketability. Australian efforts with the International Rice Research Institute have increased rice production over 50 per cent over the last 14 years, with a new Agriculture Quality Improvement project aiming to benefit over 200,000 farm families. In the health sector, Australia will support the Cambodian Government's efforts to improve and extend cost-effective primary health care services to up to 1.6 million people in Cambodia's most populous province. A second phase of support to strengthen capacity in Cambodia's criminal justice sector will build on and consolidate the achievements of the first phase, improving human rights conditions and strengthening the rule of law. Australia will continue to provide operational support to the Cambodia Mine Action Centre.

Thailand

Country program allocation $17.0 million

Estimated other flows $8.0 million

Estimated total aid flows $25.0 million

Australia's aid program in Thailand has a broad focus on governance, and is designed to build government policy, management and service delivery capacity. It targets rehabilitation of the banking and finance sector. Assistance is being provided to strengthen prudential supervision and regulation in the Bank of Thailand.

A Capacity Building Facility will deliver a $10 million program of short-term technical assistance and training over three years. The facility will provide the Prime Minister's Office with assistance in reforming the entire public sector procurement system. Other key activities will continue to support Thailand in the fields of economic governance, public sector capacity building, and civil service reform.

Mitigation of negative social effects will continue, primarily through the Australian Community Support Scheme, which provides grants to local community organisations and programs. Activities are supported in areas ranging from community forestry and village weaving to human rights strengthening and constitutional reform.

Lao PDR

Country program allocation $14.0 million

Estimated other flows $4.8 million

Estimated total aid flows $18.8 million

The Australian aid program is supporting the Government of the Lao PDR to improve its ability to meet its people's basic needs by supporting primary health care, rural development, broader access to education and policy reform.

In 2001-02, a new five-year phase of Australia's support for the development of primary health care services in the northern provinces will commence. Goals include a reduction in the rate of infant mortality of 75 per 1000 live births and an increase in life expectancy above the average of 54 years. As well as providing better health services, this activity will support the Government's decentralisation policy by building local ownership and increased capacity for service delivery in rural areas.

The aid program is providing support for Australian NGOs that have played an important and effective role in delivering assistance to the most disadvantaged rural communities. In 2001-02, NGO activities will include HIV/AIDS awareness and clean water and sanitation.

Australia will continue support for reform of land tenure and property rights and the Lao PDR's accession to the World Trade Organisation (WTO) planned for 2001. Australia is also supporting financial sector reform of state owned banks and increased public sector transparency in conjunction with the United Nations Development Program (UNDP).

Burma

Country program allocation $1.6 million

Estimated other flows $2.8 million

Estimated total aid flows $4.4 million

In 2001-02, Australia's small program of humanitarian assistance will focus on basic health and HIV/AIDS control. Australian government assistance is channeled mainly through Australian NGOs and multilateral organisations (including UN agencies), with bilateral, government-to-government aid largely suspended because of concerns over Burma's poor human rights record.

In 2000-01, the Australian Human Rights Initiative has been working in a practical way to bring about improvements in human rights for Burmese people, for example through the provision of short term training in international human rights law and practice. The Australian Government is considering options to continue the Human Rights Initiative, which is aimed at the eventual establishment of a national human rights institution in Burma.

In 2001-02, Australia will continue to fund a number of NGO projects for primary health care and HIV/AIDS control projects under the Burma Community Health Program, and other small-scale activities related to poverty reduction and basic human needs. Outside Burma, Australia provides health, shelter and food assistance to refugees in camps on the Thailand/Burma border, and is part funding a distance education project delivering community management and English language courses for Burmese refugees in Thailand. The aid program is also helping to reintegrate displaced persons returning to Burma from refugee camps in Bangladesh.

South Asia

Regional development indicators

Country

GNP per capita
($A)

Access to water
(% of population)

Life expectancy (years)

Adult literacy
(% of population)

         

Bangladesh

573

97

59

41

India

697

88

64

57

Sri Lanka

1271

83

74

92

Nepal

341

81

58

41

Pakistan

728

88

63

45

Maldives

1160

100

68

97

Bhutan

790

62

62

-

         

Source: GNP per capita and adult literacy (2000): DAC; Access to water (2000): Global Water Supply and Sanitation Assessment 2000 Report; Life expectancy (1998): Geographical Distribution of Financial Flows to Aid Recipients 1995-1999, OECD.

Estimated total aid flows to South Asia in 2001-02 $92.0 million

Diagram 11: Estimated total aid flows to South Asia by country 2001-02

Diagram 11: Estimated total aid flows to South Asia by country 2001-02

Regional strategy

Given the extent of poverty in South Asia, the Australian aid program has to be highly focused. This entails identifying niche areas where Australian assistance can deliver high impact development outcomes. Australian aid requires a tight geographical and sectoral focus with complementary activities supporting strong local efforts, aimed wherever possible at drawing in and catalysing other assistance.

The program is developing an increased focus on sustainable poverty reduction. Core areas include:

Bangladesh

Country program allocation $22.1 million

Estimated other flows $14.9 million

Estimated total aid flows $37.0 million

In 2001-02, Australian aid will continue to support Bangladesh's efforts to achieve food security, contributing to sustainable improvements in household food security and nutrition for some 400,000 extremely poor households. In education more than a quarter of a million girls will benefit in 2001-02 from the Intensive District Education for All project that is increasing access to better quality primary education. Programs aimed at reducing arsenic contamination of drinking water will lessen the risk of poisoning among rural communities. Microfinance programs will provide opportunities for small-scale livelihood activities in the North West and the Chittagong Hill Tracts.

India

Country program allocation $14.7 million

Estimated other flows $5.8 million

Estimated total aid flows $20.5 million

Australia will continue to assist India to address its considerable development needs through a strategically targeted program. Key sectors are education, health, and water and sanitation, with a focus on the northeast, Sikkim and Himachal Pradesh. These areas are among the poorest in the country, have reformist governments and currently little access to external development resources. Improving the capacity of local authorities to provide clean water and sanitation will have a significant impact on the health of hundreds of thousands of poor people in the towns of Bangalore, Shillong and Gangtok.

Sri Lanka

Country program allocation $6.1 million

Estimated other flows $4.9 million

Estimated total aid flows $11.0 million

Australia is supporting the capacity of the government of Sri Lanka to deliver services, particularly in environmental management and health. The ongoing civil conflict is a major cause of entrenched poverty and hence Australia is supporting activities that enable communities affected by the conflict in the North and East to resettle in more peaceful areas.

Nepal

Country program allocation $6.3 million

Estimated other flows $1.6 million

Estimated total aid flows $7.9 million

Australian assistance to Nepal seeks to alleviate poverty by supporting the community management of natural resources and the development of human resources through new scholarships for around 22 students to study in Australia in 2001. More than 400,000 people from poor rural communities will benefit from improved environmental practices through the Community Resource Management Project in Nepal. In health, Australia is developing initiatives to combat the spread of HIV/AIDS through education and treatment to mitigate the worst effects of the disease on Nepal's communities.

Pakistan

Country program allocation $2.4 million

Estimated other flows $2.1 million

Estimated total aid flows $4.5 million

Australia's program to Pakistan has a humanitarian focus. In 2001-02, the program will improve community management of environmentally degraded agricultural lands in the Punjab through implementation of an agro-salinity project which is transforming rural land poisoned with salt into productive farm land. In education, Australia will provide increased access to better quality primary education for some 35,000 girls through the Balochistan Girls' Education Project.

Maldives

Country program allocation $3.1 million

Estimated other flows $0.3 million

Estimated total aid flows $3.4 million

Human resource development in the Maldives, through about 12 new scholarships to Australian universities, will remain a high priority. Assistance will also aim to alleviate poverty in the geographically isolated outer atolls, where the program is strengthening the Government of Maldives' capacity to manage environmental resources.

Bhutan

Country program allocation $0.9 million

Estimated other flows $0.2 million

Estimated total aid flows $1.1 million

Australia will continue to support human resource development as a means of enabling the government of Bhutan to address poverty more effectively. Ten new scholarship places are likely to be offered in 2001-02. Primary health care will also continue to be addressed in selected areas.

Africa and the Middle East

Regional overview of Africa & the Middle East

Program allocation $35.6 million $2.1 million

Estimated other flows $40.4 million $7.8 million

Estimated total aid flows $76.0 million $9.9 million

Intractable poverty and epidemic illness, particularly HIV/AIDS, dominate the African development agenda. Civil and economic instability has constrained private investment flows to the economies of sub-Saharan Africa. Durable policy solutions are critical to improving government service delivery and encouraging foreign investment and economic growth.

To help meet these challenges, Australia is focusing its assistance on poverty reduction in southern Africa. Australian aid is assisting partner governments develop and implement more effective policies and programs, and is funding Australian NGOs to help fight the spread of HIV/AIDS in the region.

The HIV/AIDS epidemic is the greatest development challenge facing Africa. More than 14 million Africans have already died of AIDS, 25 million are now living with HIV/AIDS, and the disease has orphaned 13 million children. The concentration of AIDS deaths among people of working age threatens economies across the region.

Australia will work with African governments and community groups to care for those affected by HIV/AIDS and to strengthen the responses of governments, employers, researchers and communities. An Australian funded NGO program is combining technical strategies like condom promotion and STD reduction with broader responses, including community prevention and care and outreach to highly vulnerable groups. The aid program will also support a program of national level research and capacity building.

In the Middle East, Australia is continuing assistance for the humanitarian needs of over 3.5 million Palestinian refugees in the region.

South Africa

Country program funding in 2001-02 will be $10.1 million. As the engine of growth in the region, South Africa's economic future will largely dictate the economic future of southern Africa. Australia's aid program will continue to build the capacity of public institutions, particularly in agriculture, local government and vocational education. The aid program will support South Africa's social and economic reforms, a key element of which is decentralising service delivery to the provincial and local levels of government.

Programs to build the capacity of civil society to combat gender violence and reduce poverty will be undertaken with local NGOs. HIV/AIDS is a major problem, with 4.2 million people living with AIDS or HIV, the highest number of any country in the world. Water supply and HIV/AIDS projects have been implemented through Australian NGOs.

Mozambique

Despite impressive advances in democratic, economic and public sector reform, Mozambique remains one of the poorest countries in the world. Mozambique is maintaining macroeconomic stability and has allocated extra resources to strengthen social services for the poor. Country program funding in 2001-02 will be $10.1 million.

Australia's aid program to Mozambique supports the Government of Mozambique's work to overcome two major hurdles: its own limited capacity and widespread poverty. Capacity building for the public sector will bolster Mozambique's impressive reform efforts and improve provincial service delivery. Ongoing support for projects implemented by Australian NGOs will focus on water supply and sanitation, HIV/AIDS and food security. Australia is working closely with other donors to limit the effects of severe flooding which displaced tens of thousands of Mozambicans. A food security project will begin in 2001-02 to prevent Newcastle disease in village chickens and increase income and nutrition for Mozambique's rural poor.

Middle East

The Australian Government's development assistance program to the Middle East focuses on the social and economic advancement of Palestinians in the West Bank and Gaza and the humanitarian needs of Palestinian refugee camp communities throughout the region. Currently, the focus of assistance is on meeting the humanitarian needs of the Palestinian people.

In the short to medium term, the bilateral program will continue to address the urgent social and economic situation in the West Bank and Gaza, through our annual contribution to the United Nations Relief and Works Agency for Palestinian Refugees in the Near East (UNRWA) and through NGOs.

2 There is very little reliable statistical information available for East Timor, and figures may change as new data is collected. GNP per capita (1999 est); Adult literacy (1998); Life expectancy (1985); Access to safe water (1998).

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