BRUCE HILL The Australian Government is joining forces with the Westpac Bank to boost access to financial services for Fijians and Papua New Guineans. A Memorandum of Understanding between the two was signed on Monday.
Australian Foreign Minister Julie Bishop says this partnership is a significant move, and could help lower the cost of sending remittances internationally.
JULIE BISHOP Well it is a significant event - the signing of a Memorandum of Understanding between the Australian Government and Westpac. It’s the first time the Australian Government has signed an agreement of this kind with a leading financial institution but it brings together the skills and experience of the Australian Government in delivering development assistance in the Pacific and Westpac’s history of operating in the Pacific. They opened their first branch in Fiji in 1901.
And what we’re seeking to do is link inclusive economic growth with private sector engagement and the economic empowerment of women in order to lift standards of living and improve economic growth, job opportunities in the Pacific.
About 80 per cent of people in the Pacific don’t have access to basic financial services and that can include even savings accounts. People in the Pacific can be constrained in their ability to manage money, to save, to send and transfer money and to access it for businesses and livelihoods. So this partnership will be bringing to the Pacific greater access to financial services which will help grow their economies.
BRUCE HILL What does this mean in practical terms?
JULIE BISHOP In practical terms it will be looking at innovative solutions for giving access to financial services that will include using technology, mobile phones, exploring options to reduce the difficulty and cost of Pacific Islanders sending money home to reduce the cost of remittances.
We’re also looking at key infrastructure projects, via commercial loans and grant funding and we also want to support women who often make up a large part of the economies, we want to give them greater access to financial services and also leveraging commercial finance for formal sector businesses.
BRUCE HILL You mentioned there remittances. This is a very ‘hot button’ issue in the Pacific - the amount of money that workers from the Pacific in places like Australia and New Zealand send home are absolutely vital for the economy and for family economies. Can I ask you on behalf of our listeners, how much do you think you can reduce the cost of remittances by?
JULIE BISHOP Well I know that remittances are a significant part of the economy for some of our Pacific friends and neighbours. Tonga and Samoa in particular rely very heavily on remittances.
I understand that it can cost almost 15 per cent of the amount that’s being sent. So what we’re seeking to do with Westpac is reduce that cost of transfer, put it under some competitive pressure, not only between financial institutions, but also between countries. I don’t know how much we can reduce it by but I can assure you we are going to be working very hard to bring the cost down to a much more reasonable level.
BRUCE HILL The Government working with a private company like a bank – that seems a bit unusual. You’re a member of the Liberal Party, surely the Liberal Party wants the market to take care of these things rather than the Government?
JULIE BISHOP But this goes to the very heart of the Government’s policies under the umbrella of what we call ‘economic diplomacy’. We want to engage the private sector to help grow economies and help provide job opportunities.
Currently the Government is the most significant aid donor in the Pacific and we want to work with private sector to ensure that the private sector can engage more deeply in the Pacific and provide more opportunities, but at this stage it has to be a partnership between the Australian Government and private sector engagement and I think it’s going to be a success.
We need to ensure that people in the Pacific have access to the whole range of financial services including insurance and bank accounts and loans and grants, give them the infrastructure needed to manage money to lift their standard of living and improve their livelihoods.
BRUCE HILL Australia says it's doing all it can to help Fiji with efforts to secure the safe release of 45 captured UN peacekeepers. The Fijian soldiers were captured 10 days ago on the Golan Heights, by an Al-Qaeda affiliated Syrian rebel group, the Al Nusra Front.
Australia's Foreign Minister Julie Bishop says every possible assistance is being offered to Fiji.
JULIE BISHOP I have spoken personally to Prime Minister Bainimarama, also to Foreign Minister Kubuabola to assure them that we will do all we can to help release the peacekeepers. In fact I spoke with Fiji’s Foreign Minister Kubuabola on Saturday evening and again this morning as he is on his way to the Middle East.
- Minister's office: (02) 6277 7500
- DFAT Media Liaison: (02) 6261 1555