The FINANCIAL — Asia and the Pacific is leading the world out of the global financial crisis but action is needed to boost the region's economic resilience and ensure it contributes to global economic realignment, said Asian Development Bank (ADB) President Haruhiko Kuroda.
In his opening address to the ADB's 43rd Annual Meeting of the Board of Governors, “Meeting the Challenge: Asia’s Postcrisis Agenda”, Mr. Kuroda highlighted ADB's assistance to its developing member countries after its operations were expanded to a record $16.1 billion in 2009. Crisis support included $2.5 billion in budget support from the Countercyclical Support Facility and an expanded trade finance facilitation program that supported $2 billion in trade last year. “These measures helped sustain critical infrastructure development, protect social spending and stimulate investment during the worst of the crisis,” he said.
"While developing Asia is expected to grow by 7.5% in 2010, Mr. Kuroda noted that some economies in the region are still struggling. At the same time, inflationary pressures, unwinding stimulus packages, and economic uncertainty in industrial countries present challenges," ADB reports.
"Still, there is much hope," he said. "And hope, coupled with action, can secure the brighter future to which we all aspire."
To improve long-term prospects, Mr. Kuroda said Asia should begin to focus on regional demand as a major source of growth. "Asia should see itself as not only a producer and exporter of its goods and services, but also a consumer. Asia should tap its own large pool of savings for investments within the region."
Asia should also pursue a more socially inclusive growth. While the region has reduced income poverty, it is falling short on attaining critical non-income targets under the Millennium Development Goals. In response, Asia must increase investments in health, education and skills training, social safety nets, and infrastructure.
"Our vision of a poverty-free Asia will not be fulfilled until our people no longer go hungry; until expectant mothers receive the care they need; until all Asian children have the opportunity to complete their schooling and achieve their dreams," Mr. Kuroda said. "It will be a serious indictment of Asia's progress if we fail to address the gaps between the promise of a poverty-free Asia and Pacific region—and today's reality."
Environmental sustainability was another central theme of the speech, particularly climate change, which Mr. Kuroda called "perhaps the most important environmental and developmental challenge of this century." He stressed ADB's commitment to scaling up financial assistance for clean energy to at least $2 billion per year by 2013, and to mobilizing additional resources from public and private sources for climate change mitigation and adaptation.
Mr. Kuroda announced a new Asia Solar Energy Initiative, which "will serve as a major platform for sharing information on solar technologies, projects, products and issues; and facilitate transferring financial resources to developing countries to reduce technology costs." As part of this initiative, ADB has provided initial grant funding to establish the Asia Solar Energy Forum, which will serve as a knowledge platform.
In tackling the region's challenges, Mr. Kuroda emphasized the importance of regional cooperation for countries in Asia and the Pacific to "achieve their shared potential and aspirations."
Citing examples such as the Central Asian Regional Economic Cooperation (CAREC) program, the Association of Southeast Asian Nations (ASEAN), the Greater Mekong Subregion (GMS), and the South Asian Association for Regional Cooperation (SAARC), he called on leaders to take cooperation to the next level. "I believe it is time to work toward a truly integrated and globally connected Asia and Pacific region," he said. "Asia is ready to take the next step—to weave the strands of subregional efforts into a garland encompassing the region as a whole." In doing so, "Asia can cooperate to prosper, and prosper to contribute to a more inclusive and brighter future for all."
To strengthen its institutional effectiveness, ADB during the last year adopted a new people strategy to strengthen its human resources management, streamlined its business processes, upgraded risk management and strengthened its anticorruption and integrity function. This year, it will review its independent accountability mechanism and public communications policy.
"I am very excited by the changes we have undertaken, and am confident that they will help us better support developing Asia in achieving its aspirations," he said.
