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Overseas aid statement for ACFOA



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STATEMENT ΒΤ MR. E.G. Will TEAM, Q.C., M.P., FOR TIIE AUSTRALIAN

COUNCIL FOR OVERSEAS AID

The Australian Labor Party accepts the United Nations programme to work towards a national contribution of 1% of the gross national product.

Aid can be given for three basic reasons - to promote certain political purposes favoured by donor countries, to obtain a return-on capital, and to promote greater equality in the world distribution of income. The Labor Party believes that it is the third criterion which needs to be increasingly

stressed. It is the most just,, and it is to the eventual benefit of all countries since it increases the general dynamism of the world economy. Foreign aid with political

strings attached and 'foreign aid with economic strings are becoming·unpopular and inappropriate.

The kind of aid which fulfils the most just criteria and is most appropriate is multilateral international aid, provided that it is substantial" and can be quickly mobilised. Hitherto this, kind of aid has played second fiddle to bilateral aid and agreements.

The Labor Party wishes to see a further stepping up of funds to U.N. agencies, particularly to the U.N. Development Programme. It believes this kind of aid, involving low interest charges and straight-out grants and supply of technicians, helps to keep down the "financial hangover" of debt redemption. .

The Labor Party would like to see Australia giving a lead to other developed countries by an all-round stepping up of its contribution to other international bodies handling multilateral aid. We desire to see this increasing emphasis for three reasons. Multilateral aid allows economic growth without the feeling that strings are attached; it allows

the developing countries to avoid the heavy debt servicing on commercial loans; and it allows an increase in the capacity to import of the developing countries. Bilateral aid should continue, of course, but we have often seen in the past that the interest rates on bilateral aid agreements have been high - certainly there are cases where it has been higher than would have been involved in the multilateral aid. Sometimes the bilateral agreements have involved the repayment

of grants and loans in exports at fixed pricesj which were often below those eventually obtained on the world market. A certain cost was therefore involved. An increasing international acceptance of the multilateral principle can

ensure that this kind of thing does not occur.

. : 2S-S-12.