Taking the lead among countries committing cash to the tsunami relief effort, Australia has announced a pledge of $764 million US, just hours after Germany said it was kicking in $674 million US.

Australian Prime Minister John Howard announced his government's massive pledge, which will go towards Indonesian reconstruction efforts, while in that country's capital on Wednesday.

"This is a historic step in Indonesian-Australian relations in the wake of this terrible natural disaster," Howard told reporters in Jakarta. He said half the money would be dispersed in grants for short-term relief, with the balance in loans aimed at long-term reconstruction.

A joint commission, established by Howard and Indonesian President Susilo Bambang Yudhoyono, will decide how to spend the money.

His announcement came just hours after German Chancellor Gerhard Schroeder boosted his country's aid package from $27 million US to $674 million.

"We know about the importance of immediate aid but it's not enough,'' Schroeder told reporters in Berlin, as he described his plan to spend the money over a period of between three and five years.

UN Humanitarian Chief Jan Egeland, who sparked controversy the day after the tsunami struck with a suggestion wealthy countries were being stingy, has since called the world response "phenomenal."

"I'd rather see competitive compassion than no compassion,'' he told reporters when asked his opinion of what now appears to be a race among nations to be the most generous.

"If this is competitive compassion, I would welcome that as long as it is an equal compassion for everybody."

Acknowledging the growing generosity of his counterparts, Prime Minister Paul Martin said Wednesday he expects Canada's pledge of $80 million will also rise.

"We're going to do more than $80 million,'' Martin said at a morning news conference in Montreal. "It could increase a lot more. It's going to go up. It's clear the needs are there.''

He said he expects the increased funding will be announced Jan. 11 when Canada participates in a United Nations meeting in Geneva to address the region's long-term needs.

"Canada will be present for the short-term, the medium-term and the long-term,'' he said, adding Canada is interested in helping countries rebuild their institutions.

Donor conference Thursday

For now, world representatives are gathering in Jakarta for a conference aimed at ironing out how to efficiently distribute aid to the 11 tsunami-stricken countries.

In addition to Howard, UN Secretary General Kofi Annan, Chinese Prime Minister Wen Jiabao and Japanese Prime Minister Junichiro Koizumi are to attend Thursday's summit. Foreign Affairs Minister Pierre Pettigrew and International Co-operation Minister Aileen Carroll will represent Canada.

Touring tsunami-stricken Indonesia ahead of the summit, U.S. Secretary of State Colin Powell said Wednesday the shocking scene was the worst disaster he's ever seen.

"I have been in war and I have been through a number of hurricanes, tornados and other relief operations, but I have never seen anything like this," the former U.S. military chief said.

"I cannot begin to imagine the horror that went through families and all of the people who heard this noise coming and then had their lives snuffed out by this wave."

The area Powell visited, Aceh province on the northern tip of the island of Sumatra, lost nearly 95,000 people in the tsunami 10 days ago triggered by a giant earthquake under the Indian Ocean.

Florida Gov. Jeb Bush, whose own state was devastated by four hurricanes last year, also appeared shaken at the scene as he gazed down upon once-vibrant communities where not a tree or building was visible.

"I've never seen anything like this in my experience,'' he said. "Our hearts go out to the people, the families, who have lost loved ones."

Mounting toll

The death toll in south Asia and Africa has now surpassed 140,000 and officials expect it to grow further once aid workers fully assess the damage. The UN says 1.8 million need food aid, and more than 5 million are homeless.

Camps for up to 500,000 refugees will be built on Sumatra island, The United Nations announced Wednesday.

Indonesia's government has already started breaking ground on four camps around the city of Banda Aceh, where an estimated 1 million people were left homeless.

The United Nations plans to provide tents and equipment for up to 500,000, said Michael Elmquist, who heads the UN relief effort in Aceh. Makeshift camps have already sprung up but lack clean water and latrines, Elmquist said.

"The camps that are here have been improvised by the people themselves," he said. "But these are definitely not according to our standards. The sanitation is totally insufficient."

UNICEF director Carol Bellamy and World Health Organization Director-General Dr. Lee Jong-wook toured Banda Aceh on Wednesday, visiting hospitals and makeshift clinics tending the thousands of people injured.

Staff at the hospitals said that many people had infected wounds, some of which were turning gangrenous, forcing surgeons to amputate limbs.

The World Health Organization estimates that more than half a million people are in need of medical care in six nations.