00:01We're seeing both continuity and change here, Ros. In terms of continuity, one thing stays
00:06the same. Australia is still the biggest aid donor by far. Now, that's been the case for
00:10as long as the Lowy Institute has been measuring this, and probably goes well beyond that.
00:15So it's Australia first, daylight second. If you look at the numbers, it's 37% of all
00:20aid to the Pacific. That comes from Australia. The next after that is New Zealand at 11%.
00:25But the interesting shift that you're seeing really cemented in this most recent map is
00:31that Australia isn't just the biggest aid donor, it's actually becoming the biggest lender
00:36as well. So basically, since 2020, we've seen Chinese lending falling away, and Australia
00:42really stepping up into the breach. So China, which in the 2010s was really the main lender
00:49for the region, often for infrastructure, is really pulling back, and now Australia is
00:53taking its place. So it's not just a donor, now it's lending money to the Pacific at a
00:58great scale as well.
01:00And what are some of the risks for Australia of being in that position?
01:02Well, look, the same risks that China faces, basically. We saw in the 2010s when China made
01:08these loans, there were some questions. You know, was it going to create really unsustainable
01:12debt burdens for some countries? Now, in the main it didn't, but in some countries it definitely
01:17did. And we saw quite a bit of blowback in a small number of countries, particularly Tonga,
01:23which is really grappling with the implications of that debt. So the lessons for Australia
01:27here are clear. If you are going to lend, like Australia is, billions of dollars now over
01:32time going into the region since 2020, you've got to be careful that those debt burdens don't
01:37become unsustainable. The government says it's very mindful of this. It's going to be careful
01:42not to put too much money on Pacific balance sheets. But this is a really difficult juggling
01:47act that Australia is going to have to make as it emerges into really, when it comes to
01:51finance, a dominant position in the Pacific.
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