12/09/06 part 2

Australia is committed to moving negotiations forward quickly.
A key objective of the Doha Round is to assist developing countries to participate more fully in the global trading system as a means of facilitating economic growth and development.
Significant progress has been made in agreeing aid for trade and trade facilitation measures. However, the potential benefit of these initiatives will not be fully realised without real reductions in all countries’ trade barriers, including those of developing nations.
Developing countries can play a critical role in maximising their development gains from the Round by responding to the challenges of economic adjustment and grasping the opportunity to liberalise their own trade, including in agriculture.
Development challenges
Australia and South Africa are both situated within regions where some of our neighbours face particularly difficult development challenges.
Australia and South Africa also share a commitment to regional approaches that can help create a turnaround in these countries.
We welcome and embrace your political and economic efforts to strengthen and encourage economic growth across southern Africa and elsewhere in the continent. South Africa, for example, has played an importing role supporting the recent elections in the Democratic Republic of the Congo.
We, too, recognise that our position in the Asia Pacific region places us in a key role to promote growth and stability. We are taking an active and comprehensive approach to our support for neighbouring countries, through diplomacy, security efforts, our enhanced aid program, and trade policy and networks.
In recent years, Australia has increased its level of interaction with the Pacific, especially in fragile states. In some cases, Australian officials and police are working alongside local counterparts to provide support for effective and accountable government, enhanced service delivery, and improved law and justice. A key component is building the capacity of local counterparts and institutions to ensure that gains are sustainable.
As you can imagine, the principal focus of our aid effort is in the Pacific and South East Asia.
But Australia has played a role in contributing to South Africa’s development. Since 1994, the Australian Government has provided development assistance to South Africa worth more than $100 million (500 million rand).
Of course, the South African Government has many of the resources it needs to carry out its development priorities, so we have focused on niche areas, where assistance can add real value.
On Sunday, at Kayamundi just outside Capetown, Australia provided $30,000 (120,000 rand) to the Maties Community Clinic. Yesterday, I announced new funding of $250,000 (1.36 million rand) for a new joint South Africa-Australia Economic Research Programme and a further $70,000 (380,000 rand) to support the South African Finance and Fiscal Commission.
I would like to announce today a further contribution by Australia which will assist Africa.
In the Budget I brought down earlier this year, we announced that Australia would make an upfront payment of A$136 million to the World Bank to cover its share of the cost of the first 10 years of debt forgiveness for low income countries under the Multilateral Debt Relief Initiative — one of only a handful of countries to do so.
I am pleased to announce that Australia has made good on this commitment. Today, Australia is paying A$136 million as our contribution to paying off 10 years of debt owed by heavily indebted poor countries to the World Bank — including 16 African nations — benefiting these countries and ensuring that the World Bank's work in the fight against global poverty is not reduced. Today's payment is in addition to the A$112 million that Australia has already provided to the World Bank and IMF for debt relief.
Under the Heavily Indebted Poor Countries Initiative, Australia goes beyond the objective of reducing debt to sustainable levels and gives 100 per cent bilateral debt relief to eligible countries.
While poverty in Africa remains widespread, there are some encouraging signs. After steep declines between the mid 1970s and the late 1980s, average annual GDP growth in Sub Saharan Africa doubled to 3.8 per cent since the mid 1990s and was 6 per cent in 2005.
African countries are increasingly taking ownership of their development programs and there have been measurable improvements in both political and institutional governance. The challenge is to build on this momentum by accelerating the pace of reform.
The key to success without doubt is a commitment to sustained economic growth. The evidence is that when the average income of a society grows, the proportion of people living below the poverty line falls.
Not only income, but also social indicators such as life expectancy, maternal and infant mortality, and education all tend to improve with economic growth.
In East Asia, economic growth has been mainly based on opening the economy, trade liberalisation and moving to a market economy. It is not aid, but trade and economic reform that have led economic growth in East Asia, delivering millions from poverty.
The proposition that economic growth is central to development does not mean that education, health and physical infrastructure are not important. But sound economic policy is essential to allow resources to be used more productively, incomes to be increased and social and physical infrastructure to be developed for the benefit of the whole community.
This is the reason we focus on governance — on institutional reform and capacity building — in our own region and beyond.
Closing remarks
My message today has been very largely a positive one:
• the strength of our bilateral relationship, including substantial and growing trade and investment links;
• the closeness of our co operation in important multilateral forums such as the G 20;
• and increasing prospects for real progress in the fight against poverty in Africa.
But there is plenty of work still to be done:
• to re energise multilateral trade reform;
• to help reshape the multilateral economic framework;
• to promote open and well functioning global markets in energy and mineral commodities;
• and, above all, to tackle poverty in strategic and effective ways.
Australia and South Africa are key partners in these endeavours