ADB to es­tab­lish re­gional hub to help im­prove re­source mo­bi­liza­tion

Daily Messenger - - Biz -

IS­LAM­ABAD: The Asian Devel­op­ment Bank (ADB) is es­tab­lish­ing a re­gional hub to pro­mote knowl­edge shar­ing and strengthen co­op­er­a­tion on tax pol­icy and tax ad­min­is­tra­tion across economies in Asia and the Pa­cific and their devel­op­ment part­ners.

“I firmly be­lieve that one of the keys to suc­cess in achiev­ing the Sus­tain­able Devel­op­ment Goals (SDGs) in a world re­shaped by COVID-19 (coro­n­avirus disease) will lie in strength­en­ing do­mes­tic re­source mo­bi­liza­tion (DRM) and in­ter­na­tional tax co­op­er­a­tion (ITC),” said ADB Pres­i­dent Masat­sugu Asakawa in a sem­i­nar to­day at ADB’s 53rd An­nual Meet­ing.

The Re­gional Hub on DRM and ITC will fo­cus on pro­mot­ing DRM and ITC through close col­lab­o­ra­tion among fi­nance and tax au­thor­i­ties of de­vel­op­ing economies; in­ter­na­tional or­ga­ni­za­tions such as the In­ter­na­tional Mone­tary Fund (IMF), the Or­gan­i­sa­tion for Eco­nomic Co-op­er­a­tion and Devel­op­ment (OECD), and the World Bank; and re­gional tax as­so­ci­a­tions.

De­spite many de­vel­op­ing economies hav­ing main­tained strong and steady gross do­mes­tic prod­uct (GDP) growth in re­cent years, tax yields have not in­creased pro­por­tion­ately. Even prior to the pan­demic, many economies did not achieve a min­i­mum tax yield of 15% of GDP—a level now widely re­garded as the min­i­mum re­quired for sus­tain­able devel­op­ment. The COVID-19 pan­demic has wors­ened the sit­u­a­tion due to in­creased pres­sure on economies’ ex­pen­di­tures and a de­crease in tax rev­enue, leav­ing lit­tle room to fur­ther in­crease ex­ter­nal bor­row­ing.

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