Australia concerned on use of aid

By Shalveen Chand 09 May 2024, 3:00PM

Samoa and Pacific island countries using foreign labour for infrastructure projects funded by aid money is problematic, said Australia’s Minister for the Pacific and International Development Pat Conroy.

He made the comments as Australia gears to give AU$492 million (SAT$900,000) to the Asian Development Bank (ADB).

He told the ABC the ADB played a "critical role" in the Pacific but there had been a "number of issues" with the way it had operated.

"They've been focused too much on awarding contracts to the cheapest bidder, and that's led to, quite frankly, poor quality outcomes for the Pacific," he told the ABC.

"It has been accompanied by not using local labour. So, we have been lobbying very hard and will continue to lobby on this."

Mr Conroy said the ADB had already agreed to Australia's request to brand projects with the bank's own logos rather than with the logos of the contractors who built them.

The government has been irritated by the way Chinese state-owned enterprises emblazon their branding on projects which they have built, but which were funded by the ADB or the World Bank.

"This confuses people — I've been in the Pacific many times and walked past projects which have been funded by Australian and Japanese taxpayers through the ADB, but looking at the project branding you'd think it was associated with another country," Mr Conroy told the ABC.

"That's not a reasonable position to be in. I'm glad the ADB has recognised that and changed its policy."

The minister said the World Bank had also agreed to change procurement rules so that it looked at value for money over the life of the asset – rather than just the cheapest building bid — and that Australia would continue to use its sway as a major funder of the ADB for it do the same.

"They've heard our message. How they respond is something we're working through with them," he said.

"I think they recognise that partially, they've been trying to make funds go further by choosing the cheapest bidder, but that has resulted in not always good quality, and not using local workers."

He said the government would also look to "top up" projects funded by development banks to ensure they were of a high standard and good quality, pointing to an ADB ports development in Tonga last year, saying Australia's decision to provide an extra $20 million helped get a "good quality" New Zealand contractor in to complete the project.

The ABC has approached the ADB for comment, but it hasn't yet responded.

By Shalveen Chand 09 May 2024, 3:00PM
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