Print Edition - 2017-05-05 | MONEY
ADB to expand lending in Asia by 50pc by ’20
May 5, 2017-
The 50th annual meeting of the Asian Development Bank (ADB) began in the Japanese city of Yokohama on Thursday with calls for promoting good developmental policies, reducing the infrastructure gap to support economic growth, supporting ageing Asian societies and deepening regional cooperation.
The four-day meeting is being attended by over 5,000 dignitaries from Asia and across the world, including finance ministers, central bank governors, senior government officials, business executives, academics and representatives from civil society. Finance Minister Krishna Bahadur Mahara is also in Yokohama to take part in the meeting.
The ADB has come a long way since it first started operations in 1966. At the time of its establishment, Asia was mired in poverty, with per capita income standing at about $100 — the lowest in the world.
Today, it accounts for a third of the global gross domestic product and contributes to more than half of the world’s economic growth. This has turned the continent into a driver for global economic growth.
“[Still], there are many challenges facing Asia,” Takehiko Nakao, president and chair of the board of directors of the ADB, told journalists, as he urged Asian countries to focus on promotion of the private sector, attainment of sustainable development goals, gender equality, development of infrastructure projects and environmental issues.
To address these shortcomings, the ADB, in consultation with the shareholding countries, civil society organisations, the private sector and academia, is framing a new strategy, according to Nakao.
“Our role is to provide funds and knowledge, promote formulation of good policies through technical assistance and interactions with authorities, and work towards strengthening regional cooperation,” Nakao said.
One of the biggest challenges facing Asia today is the infrastructure gap, which could stifle growth if not addressed in time. A recent ADB report said Asia needed to invest a whopping $1.7 trillion per year on energy, transport, communications, and water supply and sanitation projects to support economic growth. Although the report does not explicitly mention how much Nepal needs to invest per year on infrastructure projects, a World Bank report released some two years ago had put the figure at up to $18 billion till 2020.
“So, the [infrastructure] financing need for Asia is very big,” Nakao said. This has provided an opportunity for multilateral lending institutions to fund Asia’s development without squeezing each other out. And already, the ADB and the China-led Asian Infrastructure Investment Bank (AIIB), a multilateral lending institution like the ADB, have forged collaboration to jointly finance three projects.
“We have also discussed how we can use local currency to finance projects, share expertise of human resources and [embrace] similar environmental and social impact safeguards,” said Nakao. The ADB’s focus on infrastructure development, however, should not be interpreted as an attempt to move away from addressing the social needs of Asia, Nakao clarified. “We will continue to support both social and infrastructure sectors,” he said.
It is essential for countries like Nepal to focus on development of both sectors because they are not only facing a deficit of physical infrastructure but also skilled human resources, which can be churned out by strengthening the social sector.
ADB, Jica join hands for universal health coverage
YOKOHAMA: The Asian Development Bank (ADB) and the Japan International Cooperation Agency (Jica) on Thursday signed a memorandum of understanding (MoU) to establish a strategic partnership to strengthen health security and promote universal health coverage (UHC) in a rapidly ageing Asia and the Pacific. The MoU was signed by ADB President Takehiko Nakao and Jica President Shinichi Kitaoka during a host country event at the 50th Annual Meeting of ADB’s Board of Governors in Yokohama.
Under this agreement, the ADB and Jica will explore opportunities for joint technical assistance in health policy formulation, health workforce development, and institutional capacity building for health and long-term care. The two institutions will also look at opportunities for co-financing in basic health and welfare-related infrastructure such as medical institutions and water and sanitation facilities, among other areas. (PR)
Plans to improve PPP biz environment unveiled
YOKOHAMA: The Asian Development Bank (ADB) has introduced two new initiatives to improve and monitor the business environment for public-private partnerships (PPPs) in Asia and the Pacific.
The measures, which aim to strengthen the bankability and implementation of PPPs, were announced during the 50th Annual Meeting of ADB’s Board of Governors in Yokohama, Japan, on Thursday.
The first initiative is the Infrastructure Referee Programme (IRP), which is the first programme of its kind in the PPP market. Under the programme, ADB will provide independent third party advice through qualified consultants to help public and private parties resolve disagreements that may arise over the life of a PPP project.
“Disagreements between public and private parties over risk allocation can arise during tendering, negotiation, construction or operation, potentially triggering protracted delays, increased costs and failure to deliver critical services,” said Ryuichi Kaga, head of the ADB’s Office of Public-Private Partnership (OPPP). “ADB, through the IRP, will help resolve disagreements between public and private stakeholders and support successful delivery and implementation of PPP projects in Asia and the Pacific.”
The second initiative, the PPP Monitor, is a new ADB publication that tracks the development of the PPP business environment across ADB member countries and provides insight for the public sector on structuring a sound environment for PPPs.
“We know from experience that there is substantial interest from both public and private sectors in PPPs, but they often lack essential information on the PPP environment,” Kaga said.
“The PPP Monitor will provide country-specific information critical not only for sound policy formulation but also for the private sector to make informed business decisions.” The ADB had helped Nepal frame the PPP policy. (PR)
Published: 05-05-2017 08:21