Australian Aid Over the Years: More Money to Indonesia, Less to Multilaterals

Flags of Australia and Indonesia. A study by an Australia-based think tank indicates that Australia has increased its focus on Indonesia in the last five years. Photo by: Josh Estey / AusAID

Australia has expanded its foreign aid spending in the last five years and shifted more of its attention to the Solomon Islands and Indonesia, among others, according to a paper that provides a broad view of the country’s aid program.

Stephen Howes and Matthew Morris’ “Aid Open Paper: Seven Patterns and Trends in Australian Aid” is the first in a series of papers that look at various aspects of scaling up Australia’s foreign aid program. Howes is director and Morris is deputy director of the Development Policy Center, a think tank based at the Australian National University’s Crawford School of Economics & Government.

Here are the seven patterns and trends the two economists said they observed after an analysis of Australia’s aid program over the years:

- The country’s aid program has expanded rapidly in the last five years and is set to continue increasing following the bipartisan commitment to increase foreign aid to 0.5 percent of the country’s national income.- Australia has shifted its focus from Papua New Guinea and East Asia to Indonesia, the Solomon Islands, Iraq and Afghanistan. The country’s aid to all major beneficiary countries increased, except for PNG. - The country spends the majority of its aid on helping to improve governance in beneficiary countries. Recent years, however, have seen significant increases in the budget for rural development and infrastructure. - Funding for technical assistance is declining but remains “very high.”- Seventy percent of Australia’s foreign aid is channeled through AusAID. - Australian contributions to multilateral aid organizations have fallen rapidly from 23 percent of the total aid budget in 2000 to only 10 percent in 2008. Other donors typically spend 31 percent of their aid budget through multilateral channels. - Australian aid projects have fallen in size over time.

About the author

  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.