ADB committed to the Pacific: Nakao
The Asian Development Bank continues to respond to the growing needs of the Pacific region.
The ADB president Takehiko Nakao delivering his address at the opening session in Manila of the Board of Governors during the 51st annual meeting said: “ADB’s own financial commitments, including loans, guarantees, and equity investments, were a record US$20 billion (FJ$41 bn).
“Of these amounts, our private sector operations amounted to US$2.3 billion (FJ$4.77bn), and they mobilised commercial cofinancing of US$5.7 billion (FJ$11.82bn),” Mr Nakao said. “Including official and commercial cofinancing and technical assistance, ADB’s total commitments last year were US$32 billion (FJ$ 66.4bn), a 26 per cent increase from 2016.
“Approvals for the financing of climate mitigation and adaptation reached a record US$4.5 bn (FJ$9.3 bn) in 2017, a 21 per cent increase from the previous year.
“We are in a good position to achieve our target of doubling annual climate finance to US$6 billion (FJ$12 bn) by 2020.
“These strong results were made possible by our solid capital base, thanks to the successful merger of the Asian Development Fund lending operations with the ordinary capital resources balance sheet—which took effect at the start of 2017.
“We need further efforts to accelerate disbursements and increase cofinancing. ADB approved a new procurement policy in 2017 to reduce procurement time, support the adoption of high-level technologies, and better address life-cycle costs.
“Along with our increased volume of operations, we are promoting innovative approaches and advanced technologies.
“For example, in Indonesia and Pakistan, we are using satellite data and remote sensing to improve irrigation.
“In the Pacific, we are supporting a regional disaster contingent financing programme that will enable budget support to countries in the immediate aftermath of disasters.”
Mr Nakao said on the funding side, ADB stepped up efforts to raise local currency funding to meet the growing demand for local currency loans in its private sector operations.
ADB also issued new thematic bonds such as gender bonds and health bonds.
Regional Economic Outlook
“I will now turn briefly to the economic outlook for Asia and the Pacific.
“Developing Asia grew by 6.1 per cent in 2017, and we expect growth will be 6 per cent in 2018. Excluding the four newly industrialised economies (Hong Kong, China, Republic of Korea; Singapore; and Taipei,China), developing Asia’s rate of growth is expected to be 6.5 per cent in 2018.
“It is encouraging that global and regional trade has started to grow robustly again since the beginning of last year.”
The People’s Republic of China is expected to grow 6.6 per cent in 2018, even as its growth continues to gradually moderate.
In India, growth should pick up to 7.3 per cent.
“The Association of Southeast Asian Nations (ASEAN) region, with a large total population of 650 million, is continuing to grow at 5.2 per cent. The recent rebound in oil prices has helped relieve fiscal pressures in oil-producing economies in Central Asia. “Although challenges remain, Asia and the Pacific is well positioned to sustain its growth momentum, supported by robust private consumption and investment, and anchored by sound macroeconomic policies and structural reforms.
“Active trade and foreign direct investment are the foundation of Asia’s economic success and are essential for continuing solid growth.
“Despite current disputes among some countries, we firmly believe that countries should make utmost efforts to maintain and foster an open multilateral trade system.”
Rise of New Technology and Impacts on the Region
One significant factor Mr Nakao said that would help drive the region’s future growth is advancements in technology.
“New technologies are emerging faster than people can imagine,” he said.
“New technologies such as robotics, artificial intelligence (AI), and “internet of things” have huge potential to raise productivity and improve our daily lives.
“In Asia, young entrepreneurs and homegrown innovations are becoming an increasingly important part of the economy.
“At the same time, there is growing concern that the rise of new technologies could cause widespread job losses.
“Today, we are seeing many new types of high-skilled jobs in information and communications technology (ICT), health care, education, and all kinds of business and consumer services.