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.