After extensive and lengthy discussions with stakeholders, Australia’s national government has finally unveiled its new strategy document on international development policy. Originally scheduled for publication in May 2023, the long-awaited update shows a clear focus on assisting 22 “neighboring” countries in the Indo-Pacific region in combating climate change and addressing gender inequality through enhanced peer-to-peer collaboration.
The new policy document is the first in almost ten years and tentatively promises to increase spending by $1.7 billion AUD (approximately $1.1 billion USD) over the next five years, primarily on long-term projects. Beyond climate change and gender equality, Australia’s new strategy document outlines ambitious plans to address poverty, encourage economic growth, improve healthcare, and increase infrastructure investments in the Indo-Pacific region.
Other changes in Australia’s new international development policy include additional training in development skills and expertise for staff of its Department of Foreign Affairs and Trade (DFAT) as well as increased efforts to “mobilize” private sector financing, including the creation of Australian Development Investments, a brand-new vehicle for using government money to attract private sector investments in development projects in the Indo-Pacific region.
However, despite a fairly positive reception by some press outlets and the Australian government warmly praising itself for the new policy document, a number of questions remain, including details about the new “performance and delivery framework” that has yet to be created, which is promised to both guide the implementation of Australia’s international development projects as well as measure the effectiveness of such aid.
Furthermore, other key components of the new development aid policy are still in the planning stage, and no commitment to spending a fixed percentage of Gross National Income on aid (such as the recommended 0.7%) was announced, leading philanthropic organizations such as Oxfam to warn that implementing Australia’s new development aid policy will require a “clearer pathway to funding.” And prominent experts in the field have noted that ongoing Australian efforts to fight climate change via development aid have largely failed with little accountability from previous governments.
Nonetheless, the new planning document accurately reflects both the Australian government’s desire to increase development assistance to its “neighbors” in the Indo-Pacific region (despite recent budgetary cuts to domestic programs) as well as reorient its foreign aid strategy to a more collaborative, inclusive, and local-led model rather than a “top-down” model imposed on developing nations from above in Canberra.
Commitments and goals
The country’s new development aid strategy was implemented after extensive consultations with a wide variety of stakeholders, including First Nations Australians. It reflects a new focus on “fairness,” both in terms of what it means for Australians to provide international development assistance as well as for fostering relationships based on “respect and listening to each other” with its neighbors in the Indo-Pacific region.
The key commitments from the new policy strategy are:
- Building more respectful and genuine partnerships on all levels
- “Embedding” the perspectives of First Nation Australians into all development projects
- Supporting gender equality and disability equity and rights
- Increasing investments in projects that combat climate change
- A desire to create a new strategy to deliver humanitarian aid abroad during emergencies
- A hope to find “innovative” ways to increase private sector funding
- A call to create a brand-new Civil Society Partnerships Fund to increase private sector funding and collaboration
The most important “goals” outlined in the new policy document include:
- Creating an improved performance and delivery framework
- Spending more effort on evaluating and assessing the impact of projects
- Creating a new informational website about ongoing and completed projects
- Conducting an annual performance review
- Improving inter-governmental reporting on overseas aid projects activity
- Achieving better integration with other departments of the government
The strategy document does contain a lot of verbiage about shifting Australia’s foreign aid efforts to focus on gender equality, saying that “no country can meet its development potential without ensuring all its people have every opportunity to reach their full potential”. Yet, it offers little details on how this will be achieved, saying only that the Australian government is currently in the process of “developing” a brand-new international gender equality strategy that will provide “guidance” on its foreign aid programs. The only tangible detail provided for gender equality is that the Australian government has now “committed” to a target that 80% of its development aid must address gender equality and that all investments of $3 million AUD or more will be required to include gender equality objectives.
Financing and budgetary support
A much more clearly defined thread woven throughout Australia’s new international aid strategy is a concerted effort to “mobilize” private sector funding in order to better achieve the government’s foreign aid policies. Specifically, the strategy document makes reference to the largely abandoned 2050 Strategy for the Blue Pacific Continent which was formulated in 2019 that aims to coordinate governments, civil society organizations and the private sector across the Indo-Pacific region under a cohesive development framework.
Other “mobilization” financing goals include the plan to create a government vehicle named Australian Development Investments (with a projected capitalization of $250 million AUD) to induce private sector businesses to invest in development projects, especially those related to combating climate change. Other private sector “financing mobilization” goals include expanding the Australian Infrastructure Financing Facility for the Pacific (AIFFP) beyond its only existing project, the ongoing construction of a large solar and battery energy storage facility in Palau.
The new development aid strategy document also calls on Australia to “maximize its collective impact” by working with neighboring governments to “attract financing from the private sector, multilateral development banks, and philanthropic organizations” as well as help them “expand their financing choices”.
The new policy document also refers to pressure on the Australian government’s budgetary resources, saying that Australia will “increase its blended finance capability” in order to “catalyze” greater private sector investments in development aid projects.
Perhaps the only tangible commitment in the new strategy document to improving private sector funding is in the call to expand the existing PALM (Pacific Australia Labour Mobility) program which makes it easier for businesses in Australia to hire workers from developing Pacific island countries, noting that remittances from foreign employees in Australia are a significant contributor to their economies back home and that the program “delivers benefits for both Australia and the region.”
Generally speaking, however, the new strategy document does not include any hard numbers on budgetary commitments or details about how all the new goals will be financed, or where, and to what extent, saying only that Australia is committed to taking “ambitious action” on the most pressing needs of its neighbors in the Indo-Pacific region, particularly climate change and gender equality. Clearly, much work lies ahead before the results of Australia’s new shift in international development aid policy can be seen.
