Why we provide development assistance

Population growth, rapid urbanisation and industrialisation create global demand for metals, minerals, oil and gas, leading to rapid growth in investment. The extractives and energy sectors drive trade, economic growth and development in the Indo-Pacific region by creating jobs and boosting government revenues. However, investment in developing countries' extractives sectors comes with many challenges. Many resource-rich developing countries perform worse than less-endowed countries on human development indicators. The negative impacts of COVID-19 on commodity prices and government revenues are also exacerbating economic impacts.

Australia supports developing countries to maximise sustainable benefits from their natural resources, while helping them overcome associated challenges. In the extractives sector we assist resource-rich developing country governments to strengthen relationships with the private sector and civil society, improve governance and revenue management and build technical skills. Support in this area is also important for businesses wanting to trade with, and invest in, stable and predictable overseas environments.

How we provide development assistance

We work with and alongside multilateral organisations, non-government organisations and businesses to help maximise the development potential of our bilateral partners’ extractives sectors. When coupled with robust domestic regulation, multilateral approaches help to reduce corruption and improve the transparency, accountability and management of resource extraction, with benefits for society, governments and investors.

• Australia supports the Extractive Industries Transparency Initiative (EITI) International Secretariat, the Extractives Global Programmatic Support (EGPS) Multi-Donor Trust Fund managed by the World Bank, and the International Monetary Fund's work on managing natural resource wealth.

Coupled with targeted support to extractives sector activities in countries in the Indo-Pacific region and in Africa, our multilateral and bilateral support achieves tangible outcomes for countries in our region, including:

• In 2019, the Myanmar government and Myanmar EITI launched a beneficial ownership registry, including information on the individuals owning shares of 5 per cent or more in over 120 oil, gas and minerals and gems companies, including state-owned enterprises. Australia also co-funded the Natural Resource Governance Institute with the UK to support local civil society organisations to improve extractives governance and engage in EITI processes.
• With EITI assistance, in 2020 the Afghanistan government published financial statements of several state owned enterprises, which were audited by the Supreme Audit Office for the first time – a necessary precondition to transition these entities into corporate structures with a commercial focus.
• The Australia Mongolia Extractives Program Phase II consulted with over 100 stakeholders on initiatives to improve Mongolia’s extractives investment environment and international competitiveness. This includes support for Mongolia’s geological information cataloguing system which fielded more than 119,400 requests for data from 43 countries in the first half of 2020.
• With support from Australia, Papua New Guinea became an EITI candidate country in 2014 and achieved its first validation under the EITI Standard in 2017. We have also supported the Autonomous Bougainville Government to strengthen governance arrangements for extractive industries, with a focus on enhancing community consultation, pro-poor revenue distribution and regulating small-scale mining.

Additional information on Australia’s development investments in the extractives sector is available here: Australia’s Extractives Sector Development Initiatives.