Published Wednesday, 18 January 2012
The money allocated by the International Fund for Ireland (IFI) will go towards bridging divided communities at interfaces across the region.
There are almost 90 barriers separating Protestant and Catholic neighbourhoods - most of them are in Belfast.
Justice Minister David Ford said the funding will "bring us closer" to dismantling the structures.
"A real window of opportunity exists to continue the progress we have made in recent months on interface structures," the Alliance minister said.
The more resources we can dedicate to building confidence in interface communities, the greater the opportunities for success.
Justice Minister David Ford
"The commitment and the funding package announced today by the International Fund for Ireland can only help to bring us closer to the removal of more barriers and I am looking forward to discussing this initiative in greater detail with Denis Rooney."
The IFI is an independent, internationally-funded organisation promoting reconciliation between unionists and nationalists throughout the island.
But some residents have voiced their reluctance to see the walls crumble.
Jean Brown, from Suffolk Community Forum, said the peace walls are "critical to the people in this community to give them a sense of security and stability in their homes".
Mrs Brown said there are still issues in the area that have not been cured, but do need managed.
This is a real interface with real issues that affect people's lives.
Jean Brown, Suffolk Community Forum
Meanwhile, on the other side of the wall, Renee Crawford from Lenadoon Community Forum said any action should be taken at an agreed pace.
"I think in relation to taking down any peace gates or peace walls has to be done at a pace the communities are comfortable with and if one community is not ready to take that giant step, however there's other things that can be done in the meantime to create shared services, shared space where people can come together," she said.
IFI chairman, Dr Denis Rooney, said there has been progress in recent years but recognised the fears of communities that the walls may be coming down too quickly.
He explained: "Since the 1994 ceasefire, the number of barriers has grown.
"However, many community groups, some with the support of the Fund, are doing courageous work across interfaces and in the past few years their conversations have moved towards when, rather than if, the barriers will come down.
"The physical removal of these barriers is a matter for the Department of Justice but the Fund believes that its Peace Walls Programme, which is complementary to other initiatives that are under way, will help create dialogue, build trust and confidence and develop greater cross-community cohesion with a view to communities reaching agreement that it is time to start removing the barriers," he added.
It is hoped that programme activity will start in June.