Aid to Samoa near doubles in 2018

Foreign donors committed nearly twice as much aid to Samoa in 2018 – a jump from US$88 million to US$170 million – as the year prior, new analysis shows.

The 93 per cent jump in promised aid financing in 2018 is shown in an analysis of the latest data published in The Lowy Institute’s updated Pacific Aid Map, published late on Thursday.

Similarly, the amount of aid money spent – as opposed to commitments (which are not guaranteed to materialise) – also hit a near decade-high in 2018, reaching US$200 million (T$524 million) or a year-on-year jump of more than 20 per cent, or US$40 million. 

The analysis showed the amount of combined aid money spent in Samoa in 2018 reached its highest level in nearly a decade, or since 2010, when the study's records began. 

The World Bank, China, Australia, New Zealand, and Japan are the country’s top five donors for both money spent and money committed for future projects. 

Of the aid money, only 11.6 per cent is in loan form.

The Lowy Institute is Australia's preeminent independent foreign policy think tank.

Most of the projects completed in 2018 were in the transport and government/civil society sectors, with education and “multi-sectoral” projects taking a big share too. 

Of the US$170 million in funds committed in 2018, the largest shares appear to go to ‘other’ or ‘unspecified’ sectors and the government/civil society sector, making up 50 per cent of the total commitments.

Broadly, the new map reveals the flow of development money into the region has not, and will not dry up any time soon.

First released in 2018, the map is a comprehensive look at the donor’s activities in the region, which Pacific Island countries are getting what share of the pie, and which sectors money is being spent on. 

It covers 64 donors, 38,000 projects, and more than US$20 billion in spending since 2010, and is a completely interactive, browse-able online system. 

Through its data analysis, the Lowy Institute has shown that in 2018, aid to the Pacific rose more than 25 per cent, reaching an unprecedented US$2.89 billion or roughly 8.5 per cent of the region’s gross domestic product.

All large donors are continuing to ramp up spending, with multilateral organisations leading the way, Research Fellow and map project director Alexandre Dayant said.

“Between 2017 and 2018, aid from the World Bank to the Pacific has increased by 182 per cent, and 58 per cent for the Asian Development Bank,” he told the Samoa Observer.

“It means the international community is aware of the fact that Pacific islands face difficult development challenges, not only due to their remoteness, small market size and complicated geography but also because of the real threat of climate change.”

The aid map reveals Australia, traditionally and still today the largest donor in the region, has dropped its share of contributions to the Pacific.

“While Australia remains by far the largest donor to the Pacific and absolute aid to the region is at record highs, its share has fallen from 51 per cent in 2010 of total aid to 32 per cent in 2018 due to other donors stepping up and the depreciating value of the Australian dollar,” Mr. Dayant said.

“I expect this trend to continue in the near future. Not because Australia is going to give less, but because other development partners are actively engaging with the region. 

“Australia’s Pacific Step up was quickly followed by the UK’s Pacific Uplift, France Indo-Pacific strategy and more recently, Indonesia’s Pacific Elevation. As such, I wouldn’t be surprised to see more aid coming to the region.”

This week the Australian Government released its budget for the coming year, a highly anticipated document that has come six months late due to the COVID-19 pandemic. 

The budget reveals Australia has increased its Pacific aid budget, largely in a COVID-19 response package, but reduced its overall aid spending in Asia and Africa to pay for it: the overall aid budget is AU$4 billion (T$7.5 billion), $44 million less than last year.

Pacific states can expect a slice of an AU$305 million pie over the next two years, which the Department of Foreign Affairs says is actually separate from the national aid programme. 

“Being a Pacific watcher, I was glad to see that the share of Australian aid going to the Pacific seems to be destined to continue to increase,” Mr. Dayant said.

“It’s great to see the government concede that the Pacific Step-up cannot be executed without an increase in total aid.”

He said it is too early to tell whether the new fund will be enough, but revealed the Lowy Institute will soon publish their analysis on how to finance the Pacific’s COVID-19 recovery.

As well as the Pacific states themselves, the multilateral institutions they work with received a funding boost out of the budget too of AU$362.6 million, largely divided among the World Health Organisations, the United Nations Children’s Fund, and United Nations Women. 

The Pacific Aid Map is an especially useful tool for analyzing the hotly debated aid race between the United States and China

It reveals that the two are spending very similar amounts in the region but in wildly different ways. 

Mr. Dayant said China’s average project costs US$10 million, while the U.S. spends on average US$1.6 million (not including the money it spends on funding its freely associated states it has a compact with).

“I think the U.S. has been competing with China in the Pacific far before Trump acceded to the presidency. Nonetheless, his position on China means that the trend hasn’t reversed,” he said.

“China spends important sums of aid on big infrastructure projects, projects that stand out. On its side, the U.S. has a much broader scope of projects, ranging from infrastructure to education and health.”

China, however, remains on a list of countries that do not report the details of their aid work in the region, making it hard for researchers like Mr. Dayant to accurately track their activities.

While donors like Australia, New Zealand and the World Bank have been “convinced” by the uses of the Aid Map and collaborate on sharing data with the Lowy Institute, others like China, India, and Taiwan are less easy to work with.

“They do not report clearly the aid they give to the Pacific," Mr. Dayant said.

“We had to [scrape] every budget [document] from every Pacific [nation], every press release and social media post to find information. A daunting task as you can imagine."

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