Australian Aid to PNG - AusAID

In the health sector Australian assistance (over A$250 million sinceindependence) accounts for over 70% of the donor funding received by PapuaNew Guinea. And its sustained focus on primary health and disease controlsuggests Australian aid can claim significant credit for improvements in healthstatus that have occurred.As the severity of Papua New Guinea’s budget constraints worsened and itscapacity for service delivery declined, particularly since the mid-1990s, it hasbeen necessary for Australian aid to focus on preventing further declines inbasic service delivery and living standards. Much of the positive impact ofAustralia’s aid in recent years has therefore been in maintaining infrastructure,equipment and basic services that, in the interests of sustainable development,should eventually be provided by the national government. In theinfrastructure sector, for example, Australia’s support for road maintenancecovers more than 25% of the national road network, and represents about triplethe amount Papua New Guinea itself has spent. Likewise, a recent health sectorreview has concluded that the main impacts of Australian aid in recent yearshave been related to preventing a decline in sector performance that more thanlikely would otherwise have occurred. In essence, Australia has been helping tokeep a collapsing health system functional.Australia’s assistance for the renewable resources sector in Papua New Guinea(A$200 million since independence) has covered a very wide range of subsectors,and has been limited to specific priority concerns, making it difficult toisolate the impact of Australia’s contribution to improved developmentperformance at a higher level. Further, as with activities in other sectors,broader impacts have not been well documented in individual activity reports.Overall, it appears that Australian aid has been carefully targeted to addresssome issues of critical importance, and one can infer from the success ofspecific activities that there have been some important positive developmentimpacts. For example, Australian aid was instrumental in developing andintroducing cost-effective strategies and technologies to deal with the seriousproblem of coffee rust. While objective data on the impact of this are notavailable, these initiatives increased the quantity of coffee produced byplantations and smallholders, presumably increasing the revenue from thisimportant crop.With governance issues constituting probably the most difficult of Papua NewGuinea’s development challenges, Australia’s role in helping to strengtheninstitutions, build capacity, support economic reform, promote transparency,accountability and the rule of law, and encourage greater communityparticipation in development and scrutiny of government performance hasintensified since the late 1990s. Of the total A$540 million provided to thisxii The Contribution of Australian Aid to Papua New Guinea’s Development 1975–2000