Late last year the Australian government pulled all of its bilateral aid money out of Pakistan. Less well known is the fact that it also pulled a significant amount of aid funding from Indonesia. These funds were appropriated from up and running programs so that the money could be diverted to the Pacific.
For the past 22 years I have worked for the United Nations, European Commission, Asian Development Bank and other organisations in international development all around the world. I have worked in post-conflict and post-disaster reconstruction as an infrastructure advisor to the governments of many developing nations in Africa, Eastern Europe and Asia, but also in Pacific island countries.
While I have witnessed first-hand examples of wastage of aid money in many countries, aid spending in much of the Pacific arguably displays the least value for money. While the governments of many Pacific island nations gladly accept aid funding, there is often little buy-in to assist with the implementation of aid projects. It is difficult in many cases to get government employees, including senior departmental staff, to attend meetings or take any real interest in aid-funded programs even though they are technically the client. It is even more difficult to have them take on board recommendations made by experts. Sustainability measures are in most instances fruitless, as changes made or recommended by international consultants are typically discontinued or simply forgotten once their contract terms are finished.
The Pacific already receives a large amount of aid. Measured as a ratio of official development assistance against gross national income, 7 of the 15 most aid-dependent countries in the world are located in the Pacific. Visitors to most Pacific island nations cannot fail to notice that the majority of the population live in circumstances that do not approach those of the more developed countries. Decades of aid has done little to filter down to the way most Pacific islanders live.
The blame does not rest entirely with aid recipients. Infrastructure projects funded by donors in the Pacific are notoriously devoid of well-thought-out motives, good planning and follow-up maintenance programs and are all too frequently of poor standard. Donors often give scant attention to follow-up surveys, value-for-money considerations, reciprocal and tangible inputs by recipient governments, and to holding recipients accountable. The general attitude by donors and by recipients is to build it, watch it decay, then rebuild it – all with aid money.
Regardless of this poor record, Australia wants to give the Pacific more aid, despite the fact that it is already by far the largest donor to the Pacific. In fact, Australian aid to this region over the past 10 years exceeds the combined aid of the next four largest donors (New Zealand, China, Japan and the United States). The poorly disguised impetus for this is to counter what is seen as the Chinese government’s increasingly insidious influence in the region.
Yet my experience also suggests that throwing more aid money into the Pacific will do little to halt the rise of China’s influence. I have worked closely with the governments of several developing countries including those in receipt of significant aid from China and have observed that the source of aid funds was of little importance to those in government. A good example is the Federated States of Micronesia, a country with no appreciable export economy. It has a lucrative Compact of Free Association with the United States, which ties it closely to that country. Nevertheless, this did not keep the Chinese government from investing in influential and highly visible infrastructure projects and gaining a foothold in that geopolitically strategic part of the Pacific.
While there are always pros and cons in relation to how and where aid money should be spent, the decision to divert committed funds to the Pacific surely warranted far more public debate, lead time and scrutiny than it has been afforded.
Australia’s aid to Pakistan had been largely targeted towards ending violence against women, and education and health programs for women and girls in a country where the lack of resources for female health and education and abuse of women’s rights is endemic. The money withdrawn from Indonesia was being used to fund road infrastructure and a government capacity-building program, proven means to assist economic development and good governance.
I do not argue against the continuation of, nor indeed an increase in Australia’s foreign aid budget. I do strongly believe, however, that aid should go to where it is most effective. Throwing dollars at the Pacific in the hollow hope that it will buy new best friends who will then eschew Chinese influence is a naïve view of the best way to use taxpayers’ money.
A shortened version of this article was published in The Australian.
This is an excellent summation of the issue. Having myself been involved in the Pacific for 30 years, I rarely comment about such issues since it seems such a waste of time. Aid is absorbed into the sponge-like clutches of governments and the hopelessly bureaucratic civil service and public sector, with the effect that the community at large receives no tangible impact.
Why is it that the aid agencies continue to seek targets through this amoeba of the public sector? Why do they so rarely engage with the private sector? There are so many projects, so many individuals with small businesses which are thwarted in their ambitions by the local development banks, and by the commercial banks whose parameters seem to be governed by a set of criteria that have nothing to do with risk and reward but more to do with favouritism and risk aversion.
There is an assumption that entrepreneurs in these islands are incapable of running a venture to profit and that the civil servants are the source of wisdom. Far from it and so what? If one project comes off in the long term it pays for four that fail. Get out there and engage with the private sector, deal directly with each entrepreneur with ideas and choose the ones with merit.
But of course you will say that you are bound to deal with Government and they determine how funds are dispersed. And that’s the problem and that’s why aid rarely benefits. The life style of rural communities in these island countries is as poor as it has ever been, in fact the standards have fallen behind world benchmarks.
This is a poor indictment for aid agencies in Australia and New Zealand, ADB etc., and the solution is indeed radical. But until this is recognised the taxpayers money is down the drain, as the author clearly understands.
Not sure if you are aware, but DFAT has invested in private sector development across the Pacific in its “Pacific Step Up”. The Market Development Facility (MDF) the program i work with, co-invests with private sector and key market actors in the countries we work with in the Pacific on innovation that unlocks economic growth in key sectors (https://marketdevelopmentfacility.org/). I work to facilitate DFAT funds to support the development and establishment of private sector led Business Development Services that create an eco-system that nurtures MSMEs to grow. We also publish the results we have gathered (using the DCED approach) that are showing indications of success of this approach, including amongst vulnerable communities and women-led businesses (Eg. Read our report published in 2020: https://marketdevelopmentfacility.org/partners/women-at-work/). There are criticisms of the approach to Aid in the Pacific. But investing with private sector is something that has been explored over the last decade.
G’day Carolyn, I am in Vanuatu and saw the results of Cyclone Pam and even though my home was safe the devastation made my heart bleed. I am appalled by the housing here. In Australia you would not keep your chickens in such places in case it collapsed and fell on them, but families live like that.
I am not a charity but I wanted to do something so when I could not get much interest from the Government I decided to build a “proof of concept” display so that they could touch and see what I think is a perfect cost effective solution where I can train the locals in a whole new way of construction using reinforcing that has never been in the South Pacific before which will allow me to build concrete domes structure that are totally cyclone proof , earthquake safe, fire proof, termite proof and will never suffer from concrete cancer. The life expectancy of the buildings should be measured in hundreds of years. The cost will be very, very competitive and the VALUE FOR MONEY unbeatable.
I have run into a brick wall, the Government says that because my cyclone shelters CAN BE TURNED INTO A DOMESTIC DWELLING as a foreigner I am not allowed to build them and no one else in the country has the equipment and knowledge to do it either.
The story is far too long to post here, but you can look at my website http://www.pacificoceandomes.com for details and pictures. I have never done anything in the way of dealing with a government for something like this and after 3 years I seem to be getting nowhere .
Everyone who has visited my display loves them and only two Government Ministers have been to the site.
I don’t like imposing on you but from what I read you seem to be on the same page in regards to not getting value for money for the $billions of Australian taxpayers money. I do not want to walk away as I am fully committed to improving the housing situation here for safety reasons but at 77 I worry that I will run out of time if something doesn’t happen soon.
I would love to hear from you by e-mail , the contact details are on my web page.
Thanks Carolyn for this very much your practical work into the aid program across the globe.
I have also worked in the aid program for the last 15 years but mainly in PNG; with GFATM, ILO, WB, EU and DFAT and particularly in the health and education sectors. I have a great deal of understanding in different services delivery models and across conflicting priorities all under the disguise of aid programs.
While working with DFAT on the aid program over the last 5 years, I have a different understanding to the way the Australian Aid is delivered, especially in the Pacific. The policy view in Canberra currently is “Pacific step up”, thus increasing the development aid to the Pacific. This is more of a counteractive approach to the influence of China in the Pacific.
Your point on “aid should go to where it is more effective” is a valid point. With my experience, I would add the term “selective engagement” to particular development program than spreading the aid across the different sectors.
With my view on selective engagement, unlike Australian Aid, other aid programs are sector specific and fully committed on the particular sector to address a specific problem or development gap effectively.
For Australian Aid, it spread across and encompass almost all the development sectors in a country or region. It may seen as appropriate for public diplomacy purpose but in terms of effective development, impact is less or thinly spread across the sectors.
Selective engagement would be a better model of development, particularly for bilateral aid program.
Thank you JK for your comments. Yes, Australia’s increase in aid to the Pacific is a poorly disguised means of counteracting Chinese influence. In my blog I point to the example of FSM where, despite a lucrative Compact with the US, Chinese influence is nevertheless strong so Australia’s withdrawal of committed aid to Pakistan and Indonesia would seem a knee-jerk reaction to a perceived threat rather than a well thought out strategy to deliver value for money.
I can’t speak on what aid model would be preferable for our bilateral aid programs in the Pacific but value-for-money aid is an issue that cuts across the means of aid apportionment. However aid is delivered it’s past time for our government to re-evaluate the effective use of our taxpayer’s money.
I’m interested in your comments about the supposed “disengagement” of Pacific staff. I’ve never seen any serious research on this question, to unpack multiple possible causes (eg cultural obligations for workers that take precedence over workplace obligations; lack of instruction in local languages; lack of relationship building by consultants etc etc). Over many years, I’ve come to believe that many Pacific officials are just sick and tired of short term consultants arriving with pre-packaged “solutions” that might work well in a large country in Africa or South East Asia, but are completely unrealistic for a small island developing state. Add in a dash of cultural arrogance, and the easiest way to respond is to wait for the consultant to finish their contract and go away. The late Epeli Hao’ofa satirised this decades ago in Tales of the Tikongs, which should be required reading for anyone purporting to lead a team in the Pacific. Too many OECD consultants arrive seeing the challenge as a “Pacific” problem rather than a global problem that Pacific Islanders are responding to.
Thanks Nic. Yes, there is without a doubt a large element of ‘aid fatigue’ on behalf of the recipients of decades of aid and I can fully understand where they’re coming from in many cases. It is part of the broader fatigue that also affects donors, aid workers, consultants and many others caught in that net. You’re also right to ascribe it to a global context rather than just a Pacific problem. I have seen this played out in a more graphic way in Kosovo and Afghanistan where, once locals were tired of the post-conflict aid community, they began to target them with IEDs, bombings and armed attacks. Unfortunately, it is at times a few insensitive consultants, donor staff, military or others who turn a once welcoming attitude into one of resentment. Public sentiment toward the international community is not a given and where this breaks down, the whole question of intervention and aid effectiveness needs to be re-addressed.
Hi Carolyn, thankyou for this thought provoking article. I work in development in the Pacific, currently in Fiji. Could you please advise what metrics you would use to define VFM and how would you say the Pacitic compares by these metrics to say Agrica, as I understand you have also had experience there. It would be good to hear your comparison.
Thanks Adimaibole, Aid to Africa is not without its critics – see Dambisa Moyo’s ‘Dead Aid’ (Penguin) – and I saw massive wastage of aid money there. On the other hand I worked with senior government officials and local staff who were keen to take on board recommendations and to improve their processes.
From my perspective, value for money comes down to how structurally safe any form of infrastructure is; how long a new road will last; how much money was wasted on failure to undertake proper site assessments; did locals learn new and better means of planning, delivering and maintaining the new infrastructure; how effectively could I operate in the recipient’s environment, e.g. did I receive support from government ministers and staff to assist me in working to my ToRs? Probably one of the most important aspects of value for money is the ability of the recipient to carry on my work, implement the changes that I have initiated and teach their successors how to do these things. This is a necessary (but not sufficient) means of breaking the aid cycle.
Thankyou for your comment and apologies for my late reply. In the vein of your conclusions on aid meeting VFM, wondering if you would agree that MSD would offer an opportunity to address certain constraints in thin markets like Fiji that. And if so, what are your thoughts on the work that programs like MDF and Pharma do in the region (also AusAid funded).
Many thanks Lynne. You have made a good point bringing up the risks in an overemphasis in innovation in infrastructure rather than the delivery and community engagement. While innovation in infrastructure in the concept and design phase can lead to positive improvements in value for money and practicality, the whole process of delivery and community engagement and considerations of sustainability are vitally important. I have limited work experience in PNG but have lived and worked in the Pacific, Indonesia and African countries, where there is a village structure, for many years. I imagine that the approach we used in these other localities could easily be translated to PNG. One good example of innovative infrastructure that I have worked on was the Child Friendly Schools built by UNICEF following the 2004/5 tsunami and earthquake in Indonesia. These schools had a practical but innovative design concept that suited the climate and conditions and were built relatively cheaply to high engineering design standards. There were strict contractor oversight measure in place to ensure good quality construction and school and village communities were engaged and given comprehensive but realistic maintenance manuals to help ensure sustainability. In such locations (and this particularly includes the Pacific) this is an effective way to achieve buy-in of the community and to prolong the life of the asset.
In my view one of the abiding priorities when delivering infrastructure to emerging economies is capacity building of local government staff and contractors. Too often, the aim is to build some item of infrastructure and consider this as an end product. If capacity of locals is not developed as part of this process then I would consider that the aid funding has not delivered value for money. In every locality I have worked in local contractors have needed to enhance their skills considerably in areas such as quality control, contract management, project management, financial administration, procurement, etc. If they don’t move forward with these skills they will never be able to compete with international contractors and will miss out on ever more lucrative contracts. As a consequence an important economic opportunity is lost, not merely for the contractors but for the local economy. Government employees who oversee infrastructure planning and delivery also need to have these same skills so that they can effectively oversee large projects and programs of work. It is also vital to have international engineers involved in any infrastructure program to ensure that good engineering design is incorporated and that quality requirements are strictly controlled. As an example of the need for high quality engineering throughout the life of an infrastructure project it is a sobering exercise to look at the construction of a school: once that school is built most of the construction faults will not be apparent until it fails in the next earthquake.
Agreed, but this does beg the questions why, what could be better assistance at whatever level of aid and, after some 40 plus years of this so-called “Pacific Paradox”, how could recipients and international agencies learn to do better?
Thanks for your important question Steve. Since my background is in infrastructure I will restrict my comments to that aid sector. In my opinion there is little government/donor willpower to insist on accountability from recipient governments. Time and again I (and colleagues) have not been able to get even basic tasks done by local government staff (such as taking measurements on a construction site) nor to have them turn up for meetings, despite numerous requests. Additionally, donor government and embassy staff in country often have difficulty understanding the work that engineers do. I have seen instances where consultants with no tertiary background in engineering have been hired to oversee infrastructure works, for example. There is also often very little rigorous follow-up of projects and programs by the donor and equally little emphasis on maintenance programs. This results in infrastructure that sits and decays. These factors, and many more, lead to inefficiencies that create a dependence on aid rather than a local enhanced capacity to plan and deliver vital infrastructure unassisted.
See also my previous comments.
Thanks Steve. That is probably the hardest question of all to answer and, where it might be clear that certain aid is not working, or not working as well as it could, a definitive solution is a far more difficult prospect. In my line of work I could often see what could have worked a lot better but the impetus to make it happen would have had to come from the highest level within the donor and recipient organisations, neither of which is much interested in seeking the honest opinions of the people on the ground, such as aid workers, consultants, donor’s staff, etc. It is all too easy to throw money at developing countries, possibly buy a few political favours along the way, and tick that box. From the recipient’s point of view, the money is going to come in anyway and often with no long-term follow up of its effectiveness, creating an unbroken cycle of dependency. When decades of aid to many African and Pacific Island countries has done little to filter down to those most in need, surely it’s time to critically appraise what has worked and what hasn’t.
Very interesting read and insights, Carolyn. I recently learnt that the DFAT Innovations Fund in PNG was managed by the DFAT Infrastructure team. What is the risk in your view that this leads to an overemphasis on innovation in infrastructure (the physical assets) rather than innovations in delivery and community engagement, from my experience a formidable (larger?) challenge in PNG. Be very interested in your thoughts. Congratulations on a great article. Kind regards – Lynne Shori
After reading this article by someone with so much experience in the field I am surprised at the tone of this article. The Pacific are Australia’s direct neighbours and aside from political tugs of war with infrastructure, the Pacific live much more sustainably than anyone of us arrogant estern, developed nations people. The new civilised is to live as they do in a affluentsubsistence, self sufficient capacity with little to no carbon footprint. We are so superior thinking of them as clients because we give them money that is often politically motivated. But the fact of the matter is we arrogantly assume our way of life is better…not in terms of climate change it is not nor all the health issues when they begin eating western food. Maybe if we look at aid in supporting the local culture and their vision for developing that fits within their values and inherent strengths. Rather than their culture fitting our aid programmes. That would be money better spent. One day when our Western economy fails they will be ok. We will not. We will rely on traditional knowledge for the challenges that face us as a humanity. Issues of Climate Change and sustainability in rehabilitating the damage we have already inflicted on the earth and its people. Those at the cold face of this consumer driven western societies are the ones facing the effects of climate change already. The Pacific is extremely vulnerable in this regard and deserves us to continue to provide aid for our lack of climate change action and policy. They are reaping the destructive effects and will continue to in their daily reliance on the weather and the environment to survive.
Lenize, thank you for your comments. It seems that we are talking about different types of sustainability. The context that I use is sustainability of the longer term viability of infrastructure delivery. It is the failure to ensure this (among other things) that leads to poorly spent aid funds. I like Pacific Islanders very much and their friendly, easy going lifestyle but while many aspects of the Pacific way of life have merit it should be kept in mind that aid is not forced upon these nations. It is willingly accepted. My emphasis is on infrastructure development which is not merely a tool to impose our ‘better way of life’ it is a means of delivering infrastructure which is safer and aimed at improving health, welfare, education and economic benefits. I saw first-hand schools that had collapsed in the 2005 earthquake in North Sumatra, killing up to 200 children. We re-built schools that were designed to resist earthquake loading. We built clinics and roads to get people to and from these facilities and to centres of trade. Cultural awareness in this type of work is paramount. It is not a matter of arrogantly assuming our way of life is better. The lives and welfare of these peoples are as valuable and as important as ours. They deserve infrastructure that will ensure their continued safety and well being. We need to find a way to deliver this more effectively.
Interesting read. I’m curious what sector the increased aid in the Pacific will go to. Australia is withdrawing aid that support women, girls, governance, capacity building etc. in Pakistan & Indonesia to increase its aid in the Pacific. Will the increased aid fund the same priorities it funded in these two countries? Or will it be directed towards infrastructure in the Pacific because that’s where the Chinese are investing?
Good question. I haven’t been able to find an authoritative statement of how the assumed funds are to be used but it is the case that Australia is focusing on infrastructure, particularly on the undersea, high speed telecommunications cable linking us to PNG.