Asia’s poorest nations snipe at ADB
Kyoto, May 6:
Asia’s poorest nations warned the Asian Development Bank (ADB) of pursuing reforms that would cater to wealthier econo-mies at the expense of the least developed.
The concerns struck at the heart of one of the world’s premier development banks, which was chartered four decades ago to end poverty through promoting economic growth. The bank is now trying to reinvent itself to remain relevant in a region where extreme poverty may be wiped out within 15 years.
Recommendations for reforming the bank, under review this weekend by the ADB’s governing officials, include shifting the focus from poverty alleviation to sustainable growth, emphasizing environmentally friendly development and turning on Asian capital instead of money from rich countries.
But some delegates are concerned that the focus on boom-economies such as China and India would come at the expense of some of the poorest nations more dependent on the bank’s programmes.
“The ADB needs to continue to enhance its engagement with the poorest,” said Anwar-ul-Haq Ahadi, ADB governor from Afgh-anistan. He said growth in Asia’s so-called emerging markets has bypassed countries like his.
The ADB says updating its mission is critical because 90 per cent of the rapidly growing region’s people are projected to be ‘middle income’ by 2020. The restructuring comes as 3,000 delegates from the ADB’s 67 member governments meet in Kyoto for the bank’s annual meeting.
The success story for most of Asia is impossible to ignore. About half of the region’s population was living on less than $1-a-day in 1970, but that fell to less than 19 per cent by 2003, according to the ADB. Over the years, Asia has turned from a debtor region to one with $3.1 trillion of foreign currency reserves, about 62 per cent of the world’s total.
By 2020, Asia is expected to account for 45 per cent of the global GDP and one-third of international trade. The advisory panel has called for the bank to adapt by connecting borrowers with regional lenders instead of simply channeling capital into the region from outside. It should also focus less on fighting poverty and more on supporting faster and more inclusive economic growth. But critics say the chan-ge overlooks problems such as growing disparity between rich and poor and rural and urban areas. They also worry that expa-nding mission could bring it into competition with WB or IMF.