Although New Zealand was slow to adopt the new worldwide focus on poverty elimination, in the early 2000s there was a fundamental change. A 2001 review of the aid programme led to the formation of a new government agency, NZAID, in 2002. NZAID was largely separated from the diplomatic concerns of its host ministry (Foreign Affairs and Trade), and it set about recruiting new staff and reviewing its programmes. Funding increased and it was given a clear mandate to concentrate on poverty alleviation.
Aid moved from former Polynesian territories (Samoa, Cook Islands), where development indicators were relatively good, to Melanesian countries (Papua New Guinea, the Solomon Islands, Vanuatu), where basic literacy, infant and maternal mortality and gender equity were far worse. These countries, along with Indonesia, became the main recipients of New Zealand aid over the 2000s. Money was channelled away from discrete projects into longer-term initiatives, often funded through government programmes such as primary education and health care.
Aid increased significantly, from $212.7 million in 1999/2000 to over $484 million 10 years later. Government funding for humanitarian relief also increased, notably in response to natural disasters such as the Asian tsunami of 2004.
Depending on aid
In the 2000s Tokelau's overseas aid (most of it from New Zealand) was considerably larger than its GDP. Economic development was very difficult, due to isolation, a tiny, scattered population and a lack of resources apart from the fishing grounds. Agriculture was at subsistence level, as there was little soil on the coral atolls, and most food was imported from Samoa. The public service was the largest employer, followed by the village workforce, and the main revenue streams were from sales of postage stamps, souvenir coins, handicrafts and fishing licences for yellowfin tuna.
Multilateral aid increases
Non-government aid agencies’ relationships with NZAID deepened as they secured contracts to deliver programmes in countries where NZAID did not have strong bilateral relationships with governments, or where it sought a closer direct link to communities and local institutions. More of New Zealand’s aid was channelled through agencies such as the World Bank, Asian Development Bank, United Nations Development Programme and World Food Programme. This saw multilateral aid increase to a third of New Zealand’s total aid.
Non-government aid agencies expanded, mainly as a result of this increased government support but also because of greater public donations. Their activities widened and some, such as Oxfam, took on greater advocacy and campaign roles, supporting moves to combat climate change or promote fair trade, or lobbying for Third World debt relief.
Security and self-interest
Following the terrorist attacks in New York in 2001, and, closer to home, the Bali bombings of 2002, aid was seen as critical in supporting the security and stability of states. In the Asia–Pacific region the risk to states arose less from terrorism, and more from internal conflict and the apparent inability of some governments to cope.
In the 1990s New Zealand sent military forces and aid to East Timor and Bougainville (in Papua New Guinea) in response to civil conflict and economic collapse. Aid became an instrument in efforts to promote political stability. In 2003 the Solomon Islands appeared on the brink of collapse as a result of regional conflict. Following a request for help, a regional assistance mission was sent and New Zealand was a part of this. Police and military personnel went first, soon followed by a large and long-term aid commitment.