The importance of Australia’s Pacific step-up in the post-virus environment
24 Apr 2020|

Australia’s Pacific step-up, introduced in 2016 and significantly upgraded in November 2018, is widely seen as the spearhead of our response to China’s growing influence in our region.

At its heart is a record $1.4 billion in development assistance to the Pacific in 2019–20, accompanied by a welcome $2 billion Australian Infrastructure Financing Facility for the Pacific, an expanded Pacific Labour Mobility Scheme, and the Coral Sea cable system which will deliver high-speed communications infrastructure to Papua New Guinea and Solomon Islands.

When the impact of Covid-19 is fully felt in the Pacific, the step-up strategy will need to be revised, and it should be upgraded. Responding to China’s activities will remain important, but the further steps Australia can take may well secure for us a stronger and more wide-ranging leadership role in the Pacific, and especially the South Pacific.

Given the enormous cost of the health, economic and social measures now being implemented to save our own future, funding an enhanced step-up program isn’t going to be without domestic political challenges.

The immediate measures Australia and New Zealand are taking are vital and won’t have a significant impact on the budgets of either nation. They are sensible and will be supported by the electorate.

The real challenge is going to come when the full impact of the virus on Pacific economies and communities becomes clearer. That may not be for many months, and it will vary from country to country.

The Australian government should use this period to carry out a comprehensive review of the step-up program so that it’s not just about enhancing our regional engagement and countering China’s influence but also about rebuilding economies and communities in the long term.

That may require a significant shift in our development assistance programs so that they focus on restoring the small business and agricultural sectors; industries that have been ravaged by the shutting of international borders, including tourism and hospitality; and areas affected by the closure of schools, colleges and universities.

The government needs to consult widely with those in the Australian community who have a history of engagement with the region, such as business groups, churches, schools and universities, and major investors, such as mining companies, banks and the IT sector.

The needs of Pacific nations are going to vary greatly. Identifying what Australia is best capable of delivering is a challenge in itself.

In making that assessment, we will have to look hard at what China is doing, and planning to do.

We will also need to take account of assessments and actions by international agencies such as the International Monetary Fund and the World Bank as they examine PNG’s precarious fiscal and economic position.

We can help the island nations and their people most if we put maximum effort into combining economic support with social assistance, especially in education and healthcare.

Now, how can that best be done?

Drawing on my 40-plus years of engagement with PNG, and an association with the wider region, I urge the Australian government to bring together the businesses already operating in our region, the churches that already have direct engagement, and NGOs and community organisations that we know can deliver programs and projects efficiently and compassionately.

The response in PNG, for example, is going to have to be very different to that in Fiji, Vanuatu and Tonga. PNG is going to need long-term support to build infrastructure, to improve vital community services such as hospitals and health centres, and to develop small businesses and agriculture.

Clearly Fiji, Vanuatu, Cook Islands, Samoa and Tonga will need support to rebuild their tourism and hospitality sectors and small businesses. The needs of Timor-Leste will be different again.

Australia has enormous capacity in all these areas—and in the prevailing environment much of that is spare capacity. Harnessing that ought to be a high priority.

One clear option that’s open to Australia—and not to China—is to support the education of school and university students in Australia while capacity in individual countries is rebuilt.

Here, I draw on a personal experience. When the then PNG Prime Minister, Rabbie Namaliu, visited Australia in 1989, Prime Minister Bob Hawke asked him how the ‘people to people’ association might be enhanced.

It was agreed that, while PNG rebuilt its rundown high school system, Australia would fund up to 1,000 scholarships each year for high school students to attend public and private schools in Queensland and New South Wales.

The program lasted close to 10 years until it was terminated by both the Australian and PNG governments—a very short-sighted move.

Twenty years on, Australia is slowly introducing a similar, but considerably scaled-down, program. It should be accelerated, and expanded to include Pacific island nations in which education standards need improvement.

Expanding the program won’t just enhance our people-to-people engagement; it will also benefit struggling schools and universities in Australia.

The Pacific step-up is a good start at enhancing our regional engagement and helping to counter China’s growing influence. With the looming difficulties confronting our immediate region, Australia’s assistance needs to be stepped up even more.