Investing for the future

Investing for the future

As established development partners, Indonesia and Australia
will continue to work together through 2002, building on a strong
record of meeting considerable challenges to invest in
Indonesia's future.

From initial projects such as the Colombo Plan educational
scholarships of the 1950s, the emphasis of the joint program has
shifted over the years in line with changing Indonesian
priorities and needs.

For example, Australia responded to Indonesia's economic
crisis of 1998 by injecting more funds into the development
cooperation program, alleviating poverty by providing direct
support for the government of Indonesia's social safety net
scheme.

While current assistance of $$121 million each year remains
near 1998 levels, the program has adjusted to Indonesia's post-
crisis climate.

For example, improving governance is an important aspect of
the current bilateral program, following the Indonesian
government's identification of this critical area of reform.

In agreement with the government of Indonesia, the current
program focuses on progress within selected sectors, including
education and training, health, governance, water supply and
sanitation, natural resource management and humanitarian relief.

Australia has targeted certain areas within these sectors
through grants for bilateral and multilateral projects, with
tangible results already evident.

New projects include the provision of technical advice to
support public sector policy making, particularly in economic
reform of banking, audit and fiscal decentralization, as well as
technical support to organizations working in the area of legal
sector reform.

These projects complement established development initiatives,
such as workshops on judicial systems for more than 150 judges in
2001 to improve the standards, transparency and accountability of
the judiciary.

Assistance was also provided with evaluation of assets for
bank restructuring, and preparation of manuals for due diligence
investigations.

Further governance projects last year saw the establishment of
a State Bank Monitoring Unit in the Ministry of Finance, and
capacity building of the internal audit agency.

Health projects this year will address the long-term problems
of high infant and maternal mortality, the spread of HIV/AIDS,
and the incidence of communicable and non-communicable diseases,
in regions ranging from West Nusa Tenggara (NTB) and East Nusa
Tenggara (NTT), West Java and South and South East Sulawesi.

These projects will build on health gains through the
development assistance programs in 2001, including the
immunization of 1.3 million children in four provinces against
polio, and a decline in the parasitic rate for malaria from 19
percent to 14 percent through the Alor Community Based Health
Project.

Care for mothers and their children also improved through
training for 328 midwives in basic safe delivery care, delivery
of emergency obstetric equipment to 496 health centers and 27
hospitals, and the establishment of maternal child health savings
schemes in 45 villages.

In the area of education and training, 2002 projects include
the development of skills accreditation systems in Makassar,
Batam and West Java, short term training, continuing support to
the social safety net and a new activity focusing on basic
education in NTT.

The Australian development postgraduate program will provide
360 scholarships this year, following last year's successful
outcome of more than 300 new Australian scholarships, with more
than 900 Indonesians studying in Australia under the same program
at any one time.

Also in 2001, approximately 2,500 Indonesians from the private
and public sectors gained new skills in health, governance,
environment and gender through short course training.

In the sectors of natural resource management and water and
sanitation, this year's program will target the management of
coral reefs and capacity building of environmental management
agencies, in addition to activities providing water and
sanitation to low-income communities in East Java, NTB, West and
South Sumatra.

Last year's program involved training for approximately 1,000
people in community-based fisheries management.

Finally, this year's program for humanitarian and emergency
relief will primarily assist displaced persons and host
communities affected by conflict and civil unrest, as well as
responding to needs generated by natural disasters.

The current framework for development cooperation with
Indonesia runs until 2003, outlining where and how Australia
provides assistance, and the process of shaping a new program
through consultation with the government of Indonesia is already
underway.

While the challenges Indonesia faces are diverse, Australia
aims to continue assisting Indonesia to overcome these obstacles
through the development cooperation program.