62 The Contribution of <strong>Australian</strong> <strong>Aid</strong> <strong>to</strong> Papua New Guinea’s Development 1975–2000Year Catalysts Objectives Priorities1989 • First Treaty• Namaliu Governmentincreased priority ofsocial sec<strong>to</strong>rs1995 • Economic recoveryprogram following1994 financial crisis• Devolution <strong>to</strong>provincialgovernments1998 • Recovery from majordrought in 1997• Res<strong>to</strong>ration of peaceon Bougainville• To promote self sustaining economic growth with equity andcontribute <strong>to</strong> <strong>PNG</strong>’s stability and social cohesion.• To reduce progressively the overall level of <strong>Australian</strong> aid,shifting from budget support <strong>to</strong> project aid.• To maintain support within Australia for aid <strong>to</strong> <strong>PNG</strong>.• To consolidate the geographic spread of <strong>Australian</strong> aid andachieve an appropriate balance in sec<strong>to</strong>ral emphasis betweenprojects supporting economic growth and those supportingsocial development.• To assist <strong>PNG</strong> meet its objectives of greater self-reliance,economic stability, social and gender equity and povertyalleviation.• To strengthen <strong>PNG</strong>’s abilities <strong>to</strong> develop sec<strong>to</strong>ral policies,improve basic service delivery especially in rural areas, fosterinvestment and create employment.• To promote sustainable development, self-reliance, stabilityand social cohesion.• To assist with implementation of <strong>PNG</strong>’s economic reforms.• To strengthen <strong>PNG</strong>’s ability <strong>to</strong> improve basic service deliveryespecially in rural areas, implement development programs,foster investment and create employment.• To enhance <strong>PNG</strong>’s capacity <strong>to</strong> plan for devolution of servicedelivery responsibilities <strong>to</strong> provinces.2000 • Second Treaty • To relieve poverty and achieve sustainable development.• Budget support • To introduce contestability among <strong>PNG</strong> organisations seekingphase-out completed aid funds.• Human resource development and institution strengthening,especially at provincial level• Rural development• Civil aviation• Forest & environmental management• Continued support for law and order projects• Revenue generation (taxation/cus<strong>to</strong>ms)• Health• Education & training• Transport & communication• Renewable resources• Law & justice• Private sec<strong>to</strong>r developmentSame sec<strong>to</strong>rs, but emphasis on:• Maximising involvement of <strong>PNG</strong> agencies in delivery, includingproject funding through <strong>PNG</strong> agencies• Greater NGO involvement• Increased commodity supply• Strengthen governance• Improve social indica<strong>to</strong>rs• Build prospects for sustainable economic growth• Consolidate the peace process in Bougainville
ANNEX B SECTOR BREAKDOWN OF AUSTRALIANAID TO PAPUA NEW GUINEA, 1975–2002Sec<strong>to</strong>r Sub-Sec<strong>to</strong>r A$ (Nominal) % of % ofSec<strong>to</strong>r ProgrammableTotal <strong>Aid</strong>CIVIL SOCIETYCommunity Development 37,436,329 33.8Post-Conflict Peace Building 58,925,748 53.2Private Sec<strong>to</strong>r Development 14,330,392 12.9Sec<strong>to</strong>r Total 110,692,469 100.0 5.4GOVERNANCEEconomic & Public Administration 159,064,406 37.1Law & Justice 240,202,725 56.1Post-Conflict Peace Building 29,239,560 6.8Sec<strong>to</strong>r Total 428,506,690 100.0 20.8EDUCATIONElementary, Primary, Secondary 284,454,879 53.0Management & Administration 24,289,870 4.5Non-Formal, Managerial & Teacher Training 39,347,198 7.3Technical & Vocational Education 43,469,664 8.1Tertiary 145,605,949 27.1Sec<strong>to</strong>r Total 537,167,560 100.0 26.1HEALTHBasic Health Infrastructure 11,017,121 4.3Health Education 20,127,238 7.9Infectious Diseases 35,797,894 14.1Management & Administration 51,439,498 20.2Maternal & Child Health 48,816,961 19.2Medical Services 19,259,987 7.6Sec<strong>to</strong>r-wide Programs 68,006,680 26.7Sec<strong>to</strong>r Total 254,465,379 100.0 12.3INFRASTRUCTURECommunications 27,357,028 5.5Housing, Construction, Urban Planning 798,920 0.2Management & Administration 15,035,432 3.0Cross-Sec<strong>to</strong>r 56,308 0.0Post-Conflict Peace Building 15,195,144 3.0Power & Energy 4,101,567 0.8Air Transport 99,471,954 19.9Land Transport 311,811,400 62.4The Contribution of <strong>Australian</strong> <strong>Aid</strong> <strong>to</strong> Papua New Guinea’s Development 1975–2000 63
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BOXESBox 3.1 The Dutch Disease in P
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FOREWORDAs part of a broader focus
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programs to improve living standard
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sector since independence, 65% has
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1 INTRODUCTIONThis report provides
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Figure 2.1 Real GDP per capita in P
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1985 1990 1995 2000PNG HPC LIC LMC
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significant strain on the budget an
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• Improved central coordination a
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- Page 59 and 60: also improved 24 , and there is evi
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- Page 79 and 80: 8 REFERENCESAhai, N., 1988, The Dev
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