Australia Pledges $492 Million to Asian Development Bank, but Pushes for Reforms
Australia has committed $492 million to the Asian Development Bank (ADB) for the 2025-28 period, a slight increase from its previous contribution. However, the government is also urging the ADB to overhaul its project funding approach in the region.
The Albanese government has expressed concerns about the ADB's support for "low-quality and cut-price infrastructure projects," particularly those awarded to Chinese state-owned enterprises. These companies often submit low bids that escalate in cost later, while neglecting local labor and maintenance considerations.
Minister for the Pacific and International Development Pat Conroy emphasized the ADB's crucial role in the Pacific but acknowledged "a number of issues" with its operations. He highlighted the lack of local labor involvement and advocated for branding projects with the ADB's logo instead of contractors' logos to avoid confusion about funding sources.
Conroy also welcomed the World Bank's agreement to prioritize value for money over the project's lifespan rather than solely focusing on the cheapest bid. He expressed hope that the ADB would follow suit, recognizing the need for higher quality projects and local worker involvement.
The government intends to "top up" development bank-funded projects to ensure high standards and quality. This approach was demonstrated in Tonga, where Australia's additional $20 million contribution facilitated the engagement of a reputable New Zealand contractor for a port development project.
The ADB has yet to respond to the ABC's request for comment.