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The Australia Infrastructure Financing Facilty for the Pacific has just not delivered

By Jeffrey Wall - posted Friday, 20 August 2021


It is almost three years since the federal government announced a major policy change to try and counter China's growing influence in our region, and to rebuild our own links and credibility with key regional neighbours.

The "flag ship" to deliver what was a welcome but long overdue initiative was the Australia Infrastructure Financing Facility (AIFFP), set up late in 2018. It was to co-ordinate a mixture of grants, loans and counterpart funding for infrastructure projects in the South Pacific.

The federal government made an initial commitment of around $2 billion, a figure I have repeatedly said is just inadequate especially given the extent of China's "Belt and Road" agenda in our immediate region and beyond.

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As I have commented on numerous occasions the "roll out" of the Fund has been woefully inadequate – too slow, and too small!

My feedback, directly and indirectly, from business entities and others who have engaged with the AIFFP has hardly been positive. It is bureaucratic at best.

The time has surely come for the federal government to concede that the AIFF has just not delivered adequately on what was a worthy goal in 2018, and is today an even more urgent one. It should be abolished, and the government should go back to the drawing boards, and consult on a new model with business, churches, NGOs and the vast number of Australians with real life experience in our immediate region.

It will soon be three years since the AIFFP was announced. Let me be generous and give it six months to be fully operation, which takes its actual formation into early 2019. But that is still over two years ago.

In that time it seems that (and readers can access this on the AIFFP website – aiffp.gov.au -) just SEVEN projects have been approved! Two are in Papua New Guinea, two in Fiji, one in the Solomon Islands, one in Palau and one in Timor Leste.

It is difficult to accurately calculate the dollar value of the projects as a whole as a couple are joint ventures and one or two are just "studies".

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But the total "spend" – or more accurately the total spending "promise" – would hardly exceed $200 million.

That may seem a substantial amount to some, but let me put it in context – measured against what China has secured commitments for during the same time under the Belt and Road program and China's escalating communications, education and other loan programs with our neighbours.

I will start with the two Papua New Guinea projects. The first is the Markham Valley solar plant. It is designed to boost PNGs very low rate of electricity delivery (currently about 15pre cent of the people have access to affordable electricity). The cost? Anyone's guess! That is according to the AIFFP website still under negotiation.

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About the Author

Jeffrey Wall CSM CBE is a Brisbane Political Consultant and has served as Advisor to the PNG Foreign Minister, Sir Rabbie Namaliu Prime Minister 1988-1992 and Speaker 1994-1997.

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Creative Commons LicenseThis work is licensed under a Creative Commons License.

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