New fund to help grow influence
The Government has created a new fund to help deliver flagship international development projects, as part of New Zealand’s Pacific ‘‘reset’’.
Foreign Minister and Acting Prime Minister Winston Peters said in order to deliver on his promise to ‘‘shift the dial’’ in the Pacific, New Zealand needed to work collaboratively with Pacific nations, and create new funding channels.
As a response to the need for new ways of funding flagship projects, the Ministry of Foreign Affairs and Trade (MFAT) has established a Strategic International Development Fund.
‘‘This will allow New Zealand to be flexible and responsive to the emerging needs of our Pacific partners,’’ Peters said.
MFAT said it was in the process of establishing the fund, which would initially be capitalised at $180 million over three years.
The contestable fund comes after Peters announced almost
$1 billion of foreign affairs funding in Budget 2018.
The bulk of the funding – $714 million – was going towards an increase in Official Development Assistance (ODA). Money for the new fund would come from this ODA money.
The boost to ODA funding, announced in May, would bring New Zealand’s ODA to 0.28 per cent of gross national income (GNI) by 2021, up from 0.25 per cent in 2016. In March, Peters announced a ‘‘Pacific reset’’, which would see New Zealand playing more of a role in the Pacific, to counter growing competition and influence by non-traditional partners in the region.
While Peters never specifically referred to China, the superpower’s growing influence in the region has been well-documented. Peters said if New Zealand, and allies like Australia and the United Kingdom, did not ramp up their efforts in the Pacific, nontraditional players would fill the gap.