John Howard’s response to the tsunami catastrophe has been exactly what I would have (and in fact did) advocate. I’m sure there is some fine print, but a billion dollars is a big commitment. Assuming it’s all new money, it will roughly double our aid/GDP ratio. Even if some of it isn’t new, it’s a big effort.
Update As pointed out by PeterL in comments, my holiday mental arithmetic is out by a factor of ten – current aid is about $1.5 billion per year, and the package is $200m per year
John Quiggin 
John, half of the money is actually comprised of interest-free or low-interest loans, so it shouldn’t really be included. Nonetheless, $500 million is a whopping commitment.
Not a doubling of aid to GDP, John. This is $200 million per year. The current total aid budget is around $1.5 billion.
Not to downplay the humanitarian significance of this package , but this is essentially a security and foreign policy decision. A risky one, too, in many respects. How long can The Australian government keep the Indonesian Government, the separatists and the Australia NGO community happy?
Implementing the package will be difficult in the current security environment. Experience in Mindanao over the last 10 years bears this out – and they had a peace agreement in place before the aid started flowing there.
For the avoidance of any confusion, whoever that “PeterL” is isn’t me, despite that being an integral part of my email address.
Generous, timely and politically astute with good returns for Australia while, most importantly, addressing a humanitarian concern that needs addressing. PM Howard has shown good judgement.
To Robert, $500 million interest free loan with no repayments for 10 years is a generous contribution. The value of this loan can be understood as the income foregone from lending at market rates.
Harry,
While an interest free loan has considerable value, its less than 500m, probably close to half this depending on the repayment time. I still think its a good package, just question the accounting.
The first $500 million is generous enough. It’s $25 per capita. About what the average Australian would tip into a worthwhile charity every so often. Nothing to especially write home about, but.
As for the $500 million on loan – Indonesia can hardly afford to pay it’s present debt – so the repayment of this free loan will merely delay the repayment of their existing interest bearing loans.
So it’s a far less generous offer than it appears in the headlines.
Yes, as I said, $500 million is generous by itself, and so are the interest free loans. But it’s generous without pretending it’s $1 billion worth.
Set against this, and seen in the context of Howard’s decisive role in the liberation of E Timor, does Pr Q still think that Howard deserves to “freeze in hell” for the “massive sufferingâ€? that he allegedly caused by his “oppressive practices”?.
does Jack have a contractual obligation to be niggly and difficult? the government’s response to the tsunami disaster has been handled well, the additional aid is welcome, and there is a prospect of ongoing cooperation on relief that will be a positive relationship building exercise (as well as useful for the people affected!). Is is not possible to agree with some policy initiatives of the government while disagreeing with others – or as in the case of Prof. Q, disagreeing with a very large number of the others?
More likely, given its with John Howard he has a mutual obligation.
Very cynical committment by howard,what about sri lanka?
Was the aid tied to any promises by the indo military to stop murdering people in aceh?
Heh, Steve that was Gold.
Whats Indonesia’s ability to pay off loans like? How long is it estimated $500k would take to repay?
given that fishing was a vital industry in almost every country that was hit wouldn’t a practial way of assisting the people be giving them some fishing boats.
They could get back to work, earn some money and ensure their families don’t have to rely on welfare.