Treaties and agreements

Introduction

Australia shares treaties and agreements with Indonesia that reflect its government and non-government commitments to economic, social and humanitarian aid. This chapter discusses the most recent of these, the Australia-Indonesia Partnership for Reconstruction and Development (AIPRD), which is implemented along with the Australia-Indonesia Development Cooperation Program (AIDCP). AIPRD is Australia's second-largest bilateral agreement after aid to Papua New Guinea.

Australia-Indonesia Partnership for Reconstruction and Development

The AIPRD was announced by the Australian Prime Minister, John Howard, on 5 January 2005. AIPRD supports Indonesia's reconstruction and development efforts, both in and beyond areas affected by the 2004 Indian Ocean earthquake and tsunami. It was launched to address the Indian Ocean disaster, but also aims to assist broader efforts to raise living standards through sustainable development and economic growth. It is a long-term program of sustained cooperation and is the single largest aid package in Australia's history, bringing its total aid commitment to Indonesia to almost $2 billion over five years. The partnership also promotes security and stability in conflict-stricken provinces with eligibility for assistance in all areas of Indonesia.

Governance

The AIPRD is headed by a Joint Commission overseen by the Prime Minister of Australia and the President of Indonesia. It also comprises Australia's Minister for Foreign Affairs and Treasurer, and Indonesia's Minister for Foreign Affairs, Minister for Finance, and State Minister for National Development Planning and Chair of the National Planning Board.

Implementation

The partnership has been implemented jointly by the two countries with eligibility for AIPRD activities given only to Australian, Indonesian and New Zealand firms. Its implementation has been geared at adapting to Indonesia's development efforts and to Australia's ability to provide aid, and coordinated alongside efforts by other international development partners. An approximate total of $500 million has been channelled into a grant assistance programme managed under the existing General Agreement on Development Cooperation between Australia and Indonesia, and through a zero interest loan program used for infrastructure development.

Funding priorities

The priorities of Australia's partnership are health, education and local government services in Aceh ($50 million), rehabilitation assistance to other areas ($5 million), natural disaster management ($10 million) and to the Government Partnerships Fund ($50 million) to support exchange of skills and expertise between Australian government and Indonesian agencies. Scholarships enabling Indonesian postgraduate students to study in Australia are included in the fund with 600 available scholarships ($78 million), doubling the number of scholarships currently funded for Indonesia. More than $280 million of this funding has been allocated to specific projects such as the following:

• Aceh Rehabilitation Program ($80 million)
  
  
• Aceh Community Infrastructure Program ($25 million)
  
  
• Aceh Rural Livelihoods (Water Resources and Aquaculture) Program ($5 million)
  
  
• Aceh Tertiary Education and Training Program ($3 million)
  
  
• Government Partnerships Fund ($50 million)
  
  
• Australian Partnership Scholarships ($78 million)
  
  
• Small-Holder Agribusiness Development Program ($25 million)
  
  
• Disaster preparedness and response ($10 million
  
  
• Response to disasters outside of Aceh ($5 million)

Other future targets for assistance are being looked at by both governments. These include plans for developing a Tsunami Early Warning System monitoring the Eastern Indian Ocean, Timor Sea and Arafura Sea, to be implemented through the UN World Conference on Disaster Reduction hosted by Japan and other countries in the region. The system will coordinate national and sub-regional tsunami early warning systems under UNESCO's Intergovernmental Oceanographic Commission.