NEW ZEALAND'S INCREASED AID BUDGET WILL BENEFIT

UNCLAS WELLINGTON 000377

SIPDIS

SIPDIS

DEPARTMENT FOR KMCKELLOG

E.O. 12958: N/A
TAGS: PREL NZ XV
SUBJECT: NEW ZEALAND'S INCREASED AID BUDGET WILL BENEFIT
THE PACIFIC ISLANDS

REF: WELLINGTON 350


1. Summary: Foreign Minister Winston Peters announced on May
14 a record increase of
NZD 70 million (about USD 50 million) to New Zealand's
overseas development assistance (ODA) for the 2007/2008
fiscal year. Over half of the 20 percent budget increase
will go to the Pacific, particularly Melanesia. New
Zealand's total assistance budget now totals NZD 429 million
(USD 300 million). Over the past five years, the GNZ has
steadily increased aid to the Pacific, with 50 percent of New
Zealand's overall aid program now being aimed at the region.
(End Summary)

Raising its Effort in Melanesia
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2. On May 14, Foreign Minister Winston Peters announced
substantial increases of NZD 70 million in overseas
development assistance (ODA) for the 2007/2008 fiscal year.
He also pledged further increases through 2010/2011. Raising
New Zealand's total ODA to
NZD 429 million (USD 300 million),the current budget
increase builds on a steady five-year increase in ODA and a
continued, gradual shift in allocation that will send half of
New Zealand's ODA directly to the Pacific region. Of the
2007/2008 budget increase, more than half will go to the
Pacific, "particularly in the Melanesian countries of Papua
New Guinea, Solomon Islands, and Vanuatu, where the need is
greatest," Peters said.


3. In Papua New Guinea, increases targeting assistance to
governance, growth and rural livelihoods will bring the
country program budget to NZD 21.5 million (USD 16 million).
A series of further increases will lift the country program
to NZD 40 million (USD 29 million) by 2010/2011.


4. In the Solomon Islands, the 2007/2008 increases will raise
bilateral assistance to that country to NZD 30.8 million (USD
22.5 million). The country program focuses on development
needs in education, infrastructure and rural development.
The majority of new money in 2007/2008 will go to recovery
efforts in the Western Province and Choisel following the
tsunami. Future increases will raise the program to an

SIPDIS
estimated NZD 40 million (USD 29 million) by 2010/2011.


5. In Vanuatu, the 2007/2008 budget increases will bring the
country program to NZD 15 million (USD 11 million). The
program focus areas are education, economic development and
governance. Future increases will take the program to an
estimated NZD 20 million (USD 14.5 million) by 2010/2011.
Keegan