Global and regional challenges
Over the past 20 years, the Asia–Pacific region has experienced rapid development. More than 500 million people have been lifted out of poverty. China has become a global economic player, and Thailand is graduating from being an aid recipient. Yet significant challenges remain. Countries such as Cambodia, the Philippines, Papua New Guinea and Solomon Islands are struggling to maintain levels of economic growth sufficient to make inroads into poverty. And even with strongly performing economies such as China, there are areas of concentrated urban and rural poor.
In today’s globalised world, the peace, prosperity and security of all countries are intertwined. The Asia–Pacific’s poverty and development issues transcend political and geographic boundaries, and extend their impacts to many countries, including Australia. This interlinking of fortunes was demonstrated by the December 2004 Indian Ocean disaster that affected millions of people across Indonesia, Sri Lanka, India, Thailand, and other Indian Ocean nations. Following the disaster, countries banded together in an unprecedented international relief effort to rebuild shattered communities and livelihoods.
International trade and investment are bringing the economies of the Asia–Pacific closer than ever before. Continued regional economic growth is crucial for further development and poverty reduction. China and India play a key role in driving this growth in the region and beyond. Further economic integration, facilitated by the WTO and other trade agreements, will also drive poverty reduction. A recent World Bank study1 has found that reform of agricultural and food trade policy could result in global gains of US$265 billion by 2015 — with the benefits shared roughly equally between developed and developing countries.
More people live with HIV/AIDS in the Asia–Pacific than anywhere else outside Sub-Saharan Africa. The 2004 Avian Influenza and SARS epidemics demonstrated the vulnerability of the region to communicable diseases. People trafficking and the smuggling of illicit drugs impact upon a wide range of communities and livelihoods.
Effective governance is essential for development. Strong legal and regulatory frameworks stimulate and harness the benefits of trade and investment in promoting stable and equitable growth. Effective law and order, service delivery, and public administration help maintain national stability and security, address crises, and deal with transboundary threats. Unstable and poor political leadership are major constraints to the effective building of the state. Weak governance and corruption can lead to conflict and instability — as in Solomon Islands and the Philippines — with a negative impact on development. Conflict and instability also affect Australia. The September 11 terrorist attacks, and bombings in Indonesia, demonstrated the global ramifications of terrorism and other security concerns.
Diagram 2: Trends in Australian ODA by region
Note: Figures for 2004–05 and 2005–06 are estimates.
Australia’s response to the Indian Ocean disaster
On 26 December 2004, a series of tsunamis devastated coastal towns and communities across the Indian Ocean. According to estimates, over 225,000 people died, one million people were displaced, and five million were deprived of basic services.
The Australian Government responded immediately. Australian relief and medical personnel and supplies were dispatched within hours of the disaster. By 31 December, Australia had committed $60 million to the relief effort. Beyond the critical work undertaken by Australian specialists, this commitment included support for key multilateral agencies (UNICEF, WHO, WFP and IOM) and Australian, international and in-country NGOs.
On 5 January 2005, the Australian and Indonesian governments agreed to form an Australia–Indonesia Partnership for Reconstruction and Development. Australia has committed $1 billion over five years, the largest single aid commitment ever made by Australia. This will consist of $500 million in grant assistance and $500 million in highly concessional loans, and will extend Australia’s aid program to Indonesia to $1.8 billion over five years. Australia also committed $33 million to Indonesia for immediate emergency assistance.
In Sri Lanka, Australia committed over $10 million for emergency relief in the aftermath of the disaster. Australia’s aid program to Sri Lanka is being reprioritised to complement rehabilitation and reconstruction efforts. For example, $1 million is being provided under the Australian Community Rehabilitation Program for small-scale infrastructure projects, such as cash for work activities, to help clean up the debris in affected areas.
With schools destroyed and its reefs badly damaged, the Maldives turned to Australia for teachers, marine specialists, and engineers. Australia committed approximately $4 million for an immediate assistance package. Further packages will bring together the numerous offers of assistance received, for a collaborative response by government departments, private agencies and individuals.
In the Seychelles, Australia contributed $500,000 to the United Nations Development Programme to provide shelter for families, rebuild infrastructure, and help with general economic recovery.
This assistance is in addition to the vast efforts of, and expenditure by, the Australian Defence Force (estimated at $62 million) and Australian Federal Police, and the generous donations of over $280 million from the Australian community.
Through the aid program, Australia will also contribute to the establishment of a tsunami warning system for the Indian and south-west Pacific Oceans. This will include technical assistance for scientists and technicians in the region.
1 Aksoy, M. and Beghin, J. (eds) (2005) Global Agricultural Trade and Developing Countries, World Bank.