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1998-99 Aid budget: Aiding Australia and the region

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AA33 12 May 1998

1998-99 AID BUDGET



• '$50 million increase over 1997-98 aid budget o f $1,430 million - an increase of 0.5 per cent in real terms

• Gives effect to Better A id fo r a Better Future the Government’s response to the Simon’s Aid Review

• New $10 million two year Youth Ambassadors for Development program

• Responds to the East Asian financial crisis and El Nino - establishes a new $6 million Asia Crisis Fund and triples emergency funds to $34 million

• $14 million or 18 per cent increase in governance and human rights- including a five-fold increase in funding for practical human rights activities through the Human Rights Fund

• $2 million or 13 per cent increase in funding for core NGO program


In 1998-99 Australia’s aid budget will total $1,480 million. This is a $50 million increase over the 1997-98 budget figure o f $1,430 million. This represents a real increase o f 0.5 per cent.

Australia’s estimated ODA/GNP ratio will be maintained at 0.27 per cent, well ahead o f the latest average o f donor countries of 0.25 per cent. The aid budget is expected to represent 1 per cent of total Federal Government expenditure in 1998-99. This compares favourably with other developed nations, where the average, based on latest available figures, is only 0.88 per cent.

The 1998-99 Australian aid budget gives effect to the new objective and direction set for the aid program in Better Aid fo r a Better Future, the Government’s response to the Simons Aid Review. The 1998-99 aid budget will respond to urgent development needs, build strategic partnerships and focus on five priority sectors of governance, health, education, agriculture and rural development, and infrastructure. Australia’s aid program will continue to focus on our neighbours in the Asia Pacific region. The

1998-99 aid budget will increase support for economic governance, financial sector reform and employment generation - priorities identified by Better Aid fo r a Better fu tu re and highlighted by the East Asian financial crisis. The aid program will also Respond to the social impact of the crisis and provide relief to countries affected by El

Nino. Helping our neighbours resume sustainable growth and improving the living standards o f their people will benefit Australia by creating a more stable region which will expand Australian trade and investment opportunities, create jobs and improve the living standards o f Australians.

Youth Ambassadors for Development

A new youth volunteer program, totalling $10 million over two years, the Youth Ambassadors fo r Development program will be established. This Program will enable around 500 young Australians to live and work in the Asia Pacific, transferring valuable skills to host communities and organisations.

Responding to the East Asian Financial Crisis and El Nino

The current East Asian financial crisis is impacting on social and economic development across the region. In addition, the current El Nino has wreaked havoc on countries throughout Asia, the Pacific and Africa. In 1998-99 the Australian Government will respond to these crises through:

- A new $6 million Asia Crisis Fund to provide technical assistance to affected ' ‘ countries. Particular emphasis will be given to assisting with economic

governance and financial sector reform as well as employment generation;

- Funding for emergencies has tripled to $34 million to enable Australia to respond quickly to alleviate the suffering of victims o f disasters such as droughts, cyclones and floods;

- $20 million o f the $30 million humanitarian assistance package for Indonesia (announced earlier in May) will be provided in 1998-99. This package will include food aid, medical assistance, drought relief and support for employment generation activities;


- Provide an additional $10.2 million to Thailand over the next two years and continue aid past 2000-01 when Australia’s aid was due to cease;

- New four year pledges o f $236 million and $56 million for Vietnam and Laos respectively; and

- All other East Asian countries’ programs have been maintained.

Governance and Human Rights

Funding for governance and human rights activities will increase by $14 million or 18 per cent, to $82 million in 1998-99. This includes a five-fold increase in the Human Rights Fund. The Fund provides practical support for small, community-based projects in developing countries that promote and protect human rights.


Assistance to NGOs through the AusAID-NGO Cooperation Program (ANCP) will increase by $2 million or 13 per cent. This takes the increase in ANCP funding since « tiie Coalition came to power to 47 per cent. These increases reflect the important wfrrk carried out by NGOs and the Government’s commitment to a genuine

partnership with NGOs.

PNG and the South Pacific

In 1998-99, $298.5 million will be provided to Papua New Guinea in line with the Treaty on Development Cooperation. Programmed aid, with a particular focus on education, health, law and order, infrastructure, rural development and reconstruction in Bougainville will be $227.5 million. $71 million will be provided as budget support.

An additional $1.75 million will be provided to the South Pacific on top o f continuing bilateral and regional programs - key features include:

• $0.75 million for the new South Pacific Regional Environment Program (SPREP) headquarters, fulfilling the Prime Minister’s commitment at the South Pacific Forum in September 1997;

• building back o f t h e ' Solomon Islands program to support the current

Government’s reform efforts; and

• increased funding for policy and management reform across the Pacific. - V *

Africa and South Asia

Funding for Africa and South Asia will be maintained in real terms in 1998-99. To maximise its impact, Australia’s assistance to Africa will be concentrated on the Southern African Development (SADC) countries of South Africa, Mozambique, and Zimbabwe.



Funding for Commonwealth organisations will increase by $0.65 million to support the Trade and Investment Facilitation and Caribbean Sports initiatives announced by the Prime Minister on 25 October 1997 at CHOGM.

Media contacts: Innes Willox (Minister’s office) 02 6277 7500 / 0411 414 695 Michelle Hardy (AusAID) 02 6206 4968 / 0417 680 590