Foreign Aid

Foreign Aid
“Australia in Its Regional and Global Context”
By Alara Berisha
Table of Contents:
1.) Australia and its foreign aid links
2.) The types of foreign aid
3.) The roles of government organisations
4.) The importance of non-government organisations
5.) Treaties and agreements
6.) Economic, social and geopolitical advantage and disadvantages
7.) Impact on social justice and equity

1. Australia and its foreign aid links
Australia is a developed, English speaking country, located in the Asia-Pacific region. It itself is a continent, surrounded by smaller nations, whom we continue to make links with.
One of Australia’s most positive links with the world, and significantly the Asia-Pacific region, is foreign aid. Foreign
aid is the transfer of money and resources which is lent or given to help with the development of a country or to respond to international emergencies and disasters.
Australia’s strongest aid link is with the Asia-Pacific region, with countries like Samoa, Tonga, Kiribati, Laos, Thailand and India. The table below shows the top 12 recipients of Australian aid in 2006-07:
Country Amount (AU$ millions)
Indonesia 345
Papua New Guinea 332
Solomon Islands 223
Vietnam 82
Philippines 69
Cambodia 49
Timor-Leste 44
China 42
Bangladesh 36
Vanuatu 35
Fiji 34
Sri Lanka 31

Although Australia’s aid program primarily focuses on the Asia-Pacific region, Australia also contributes to other countries in Africa, the Middle East and Asia in smaller amounts.
2. The types of foreign aid
Bilateral aid is when the government of the donor country gives financial aid to the government of the recipient country. E.g. the agreement between the Australian and the Papua New Guinean governments.
Multilateral aid is when financial assistance is given by governments through international development banks or organisations. E.g. The Australian government contributes multilateral aid through the G8 Multilateral Debt Relief Initiative, the Asian Development Fund and the World Bank.
Tied aid is aid for a specific purpose, often requiring the receiver to spend it on goods or services that will benefit their country. E.g. in the Pakistan earthquake disaster in 2005, The Australian Government provided funds to rebuild schools and hospitals.
Untied aid is when government and non-government organisations donate to the recipient government, whom is able to choose to spend it on any goods or services which they believe will benefit their country. E.g. The Australian Government donated funds to Papua New Guinea for any purpose that may help raise living
standards.
Food aid is the donation of emergency food supplies to countries in midst of a natural disaster, famine or war. E.g. after the Boxing Day tsunami, Australia donated food supplies to Indonesia.
Technical assistance is when the government provides experts in their fields to assist the people in developing countries by helping them to develop programs and run services of their own. E.g. the Australian Federal Police and Army have been training East Timorese and Solomon Islands’ police forces.
Emergency aid is the giving of essentials such as food, clothing, shelter, medicine and medical services in response to a natural or human disaster. E.g. After a landslide in the Philippines in 2006, Australia provided them with emergency relief.
3. The roles of government organizations
In Australia, Government and non-government organisations both provide aid. The official government aid is Overseas Development Assistance, (ODAs), which can be in the form of grants or loans. Aid from Non-Government Organisations, (NGOs), comes in the form of voluntary donations or from banks and other financial institutions such as the Red Cross or World Vision.
The Australian government donates approximately AU$3 billion each year in overseas aid. Australia’s government aid program is managed by AusAID (the Australian Agency for International Development).