Australia extends A$45m to strengthen ASEAN economy

Sari P. Setiogi The Jakarta Post Jakarta

A A$45 million (US$31.72 million) aid program provided by the Australian government to the Association of Southeast Asian Nations (ASEAN) was officially launched on Wednesday evening in Jakarta.

The program, called the ASEAN-Australia Development Cooperation Program (AADCP), aims to strengthen economic integration and competitiveness in the region through a series of medium-term activities over two or three years.

ASEAN Secretary-General Ong Keng Yong told The Jakarta Post that the AADCP would focus on research and academic studies, rather than on creating physical infrastructure.

"It will, for example, conduct studies about free trade... to help policymakers in determining what decision they should take. There are many people in ASEAN countries who have good knowledge and solid expertise, and they can be encouraged to do more with some advocacy," he said.

He said the program was also expected to narrow the information gap among ASEAN nations in integrating the economies.

Priorities for the program include trade issues, such as improved customs and quarantine services, agricultural pests, disease and safety issues, food quality standards, e-commerce, the labor market and human resources development planning, and the competitiveness of small and medium enterprises.

ASEAN leaders recently agreed to integrate the region's economies by 2020 in a bid to boost trade and investment activities.

Australian Ambassador to Indonesia David Ritchie said in a speech that the program would have three core components: the program stream, interrelated capacity-building activities on economic integration and competitiveness; the regional partnership scheme, smaller collaborative activities enhancing regional development; and the regional economic policy support facility, a policy research facility on economic issues within the ASEAN Secretariat.

The AADCP is a new phase of the ASEAN-Australia Economic Cooperation Program, which started in 1974.

"Assisting the development of ASEAN is in Australia's interest. This is very good for Australia's security. Economic integration is not something we fear in ASEAN. We are very pleased with it, because it will lead to stability in the region," Ritchie told the Post .

Counselor of Development Cooperation Sam Zappia from the Australian Agency for International Development (AusAID) told the Post that the outcome of the program would also facilitate trade, including trade between individual ASEAN member states and Australia.

He said the project would exclude Singapore and Brunei, which have "graduated" because of their strong economic performances and capital incomes.

"They can participate in some of the processes, but they will not receive funding," he said.