Comments

Thanks for this post Robin. It would be interesting to know what the implications are for Nauru in this, given the economic impact that the Regional Processing Centre has had in recent times. And in that vein, I would argue that the lack of leverage was (and is) indeed significant in the case of Nauru - as discussed <a href="https://devpolicy.org/the-pacific-solution-and-naurus-coup-by-stealth-20140123/" rel="nofollow">here</a> and <a href="http://www.lowyinterpreter.org/post/2014/03/21/Deafening-silence-on-rule-of-law-in-Nauru.aspx" rel="nofollow">here</a>, Australia declined to make any meaningful comment when David Adeang decided to do away with the rule of law.

Hi Mark Appreciate the comments. Agree that the central bank limited the chance for arbitrage by constraining the amount of foreign exchange reserves available at the official rate to around K60 million every fortnight- otherwise PNG's foreign reserves would have dropped much more quickly. The comment about the arbitrage possibility was aimed at highlighting the gap was unsustainable. As you mention, the better option would have been to tender the intervention. Your last para mentions the possible budgetary impacts of these changes. I considered including some reference to these in the article - but my sense was that they were unknown and possibly largely offsetting. So as you point out, the cost of the Government's intended infrastructure spend would have been considerably more at the pre-June 4 rates. Likewise, the appreciation lowers the Kina cost of repaying international loans - including the loan to purchase the Government's share in Oil Search. On the other side of the coin, tax revenues could fall because exporter incomes are lower and hence mineral tax and company tax collections are lower in Kina terms (many of the larger miners operate their accounts in US dollars). My sense was that there were a range of positive and negative effects on the budget from the change and it was hard to determine the overall impact. At the same time, there may be other budgetary risks if the change in policy has discouraged foreign investment (and hence future tax revenues or the price of any asset sales) or increased the size of the sovereign risk (and hence costs) associated with any possible future external borrowings. Once again, appreciate the comments.

I was one of the few Australians in the audience in New York at the launch last week. It was pleasing to see Australia, the Foreign Minister and DFAT visible, and positively so. It seems clear to me that whatever else is done re the Innovation Hub investments, Australia needs to be more visible in global fora. The week prior in DC at the USAID Frontiers in Development two-day event, Australia was noticeably absent yet our content and contribution to the global debate could at worst be equal. I am enthused Australia is contributing. I am optimistic we will also create a space of leadership through our 'new aid paradigm'.

Hi Stephen. I think the pilot idea is a step in the right direction. While there is no standard visa pathway, this can be created easily enough via employer sponsored visas and it wouldn't require any migration reform (a mechanism called labour agreements using 457 visas). Further, it's like the new migration agreements announced for Darwin will include general aged care workers, not just nurses. I believe this skill level and occupation in migration programs will be required into the future and you'll see an expansion of this "semi-skilled" occupation eligibility. I also think it's probably a good idea to start in Tonga. This appears hard enough and being located in Tonga reduces one of the major risks, matching up migrants and employers. Hopefully over time, if the pilot succeeds, it can expand with some additional emphasis on that matching process which has failed to date in the SWP. I wrote about some of the migration opportunities in response to your paper <a href="http://henrysherrell.wordpress.com/2014/05/26/generating-skilled-migration-the-australian-pacific-technical-college-and-labour-mobility/" rel="nofollow">on my blog</a>. I'm optimistic given this type of labour is very different to unskilled labour which backpackers do and employers get a lot out of a more permanent relationship. We already see it at the trades-level via the substantial number of Filipino 457 visa holders in Australia. Incidentally, I know the IOM here in Dili are currently writing a National Action Plan for labour mobility so this is obviously a major topic of interest for a range of countries in the region. Cheers Henry

In Tonga last week I was struck by the number of taxi drivers who had participated in the SWP. About half of the 16 or so drivers I met had gone to Australia under the scheme (to a range of places - Griffith and Mildura were mentioned several times). All lived in Nuku'alofa, all spoke highly of the experience, and all planned to return.

Thanks for this post Stephen, I think it raises some important points and illustrates the need to think about 'joining up' initiatives with what's going on in numerous environments. One additional point is that a primary reason for APTC adopting the 'top up' approach to provision of training is to the political ramifications of competing with national VET institutions that offer qualifications up to Cert II. And by upskilling those already in industry it avoids creating a glut of people with qualifications that can't get jobs in those areas where the private sector is too small to employ them all. The Tonga initiative is interesting on numerous levels, not least why it is that Tonga seems to be the 'preferred supplier' when it comes to new labour mobility initiatives from Australia. If, as you and Jonathan have written elsewhere, it is the case that labour mobility options are more important for the countries of Melanesia surely we would expect to see an initiative similar to this one in this part of the Pacific some time soon.

Have there been any studies benchmarking humanitarian in-kind aid against humanitarian direct cash transfers (at diff levels)? I'd be keen to see that. R

EA, you make some reasonable points. But it seems to me that for many IFC technical assistance programs that are donor-funded, the organisation's main focus is on satisfying donors rather than its local government or business clients. IFC's status as a multi-lateral agency also gives it some prestige and, I suspect, immunity from the more immediate consequences a private consulting firm might suffer if it failed to deliver reasonable outcomes for its clients. Nonetheless I agree with your point that IFC may have a different kind of skin in the game than a private sector organisation.

Joel, Thanks for the comment, and query. I've got several responses. First, we know that several hundred dollars have been set aside in this year's budget (see our budget analysis from earlier in the year), so there would be no problem finding more humanitarian aid this year. Second, longer-term, we should in my view be looking to make our aid program more focused on disasters and humanitarian responses. I don't have many sectoral or country preferences, but this would be one. We know it is an area where aid generally works, and it is underfunded, and there is strong public support. We're not going to be able to give large amounts to Indonesia indefinitely. I would be looking to the humanitarian budget to soak up the excess. In twenty years time, we might have a very small aid program to Indonesia, but we should still have a very large (and much larger than currently) humanitarian aid budget. Third, I do view humanitarian aid as a benchmark for all aid, or even for all government spending. Of course it would be great if we could actually help societies develop, but let's face it, we're often not very good at it. I think it would be useful if we always asked of any proposed expenditure: is my $x million of TA/capacity building/system strengthening/scholarships/research worth more than $x million of humanitarian aid. It's a difficult question to answer, but a useful one to ask. Regards, Stephen.

Interesting article Robin. Of interest to DFAT may be the upcoming ICAI review of DFID's treatment of impact, see TOR here: http://icai.independent.gov.uk/wp-content/uploads/2014/01/ICAI-Impact-ToRs-FINAL-040314.pdf . You suggest that DFAT should consider organisational and administrative factors more when assessing performance. The imminent ICAI review will be looking at the role that DFID's processes and tools (i.e. theories of change, country strategies, the reams of documents that guide program implementation etc) play in the 'delivery of impact'. A laudable goal, but a tough gig when you don't know what the impact is in the first place!!

Well said Tom. looking forward to reading your book.

Peter, thank for your response and I couldn't agree more about your concerns regarding the need to improve people to people links between PNG and Australia. Pacific Conversations was introduced to the Devpolicy blog as a way of getting Pacific voices onto a platform that has a lot of Australian readers and I hope others will, like you, be looking out for Stella to buy and enjoy. I am also involved in the Australia-Papua New Guinea Network - you can find out more about that here: http://auspng.lowyinstitute.org/