The FINANCIAL — The Asian Development Bank’s (ADB) Board of Directors has endorsed a new country partnership strategy (CPS) with the People’s Republic of China (PRC) for 2016-2020.
Based on an agreement between ADB President Takehiko Nakao and PRC Premier Li Keqiang in March 2015, the new CPS envisages broadening and deepening various aspects of the ADB-PRC partnership, including the lender-borrower relationship for the public and private sectors, knowledge partnership, collaboration in promoting regional and South-South cooperation, and the PRC’s role as a financial contributor to ADB operations.
“Responding to the PRC’s global commitment made in Paris during the COP21 meeting in December last year, addressing climate change and environmental management is the first priority of the new CPS,” said Ayumi Konishi, Director General of ADB’s East Asia Department. “There are other remaining and emerging development challenges the PRC faces that money alone cannot address. These include efforts to address remaining poverty and a rapidly aging society, and the need to balance rural and urban development. We will be supporting the PRC using both knowledge and financial resources, including through policy- and results-based loans when appropriate, in accelerating reforms to enable the country to achieve stable and sustainable growth, which in turn will contribute to promoting sound development of the regional and global economy.”
ADB’s sovereign lending to the PRC averaged $1.51 billion per year in 2011-2015. This is expected to increase during the new CPS period, in line with the envisaged increase in the overall volume of ADB operations in Asia and the Pacific toward 2020. As ADB will be helping the PRC to deal with complex issues, ADB will be more selective in its assistance objectives while adopting multi-dimensional and multi-sectoral approaches.
ADB’s private sector operations in 2011-2015 averaged $643 million annually. The private sector will play a larger role in the PRC’s sustainable development under the new CPS, with a focus on private sector-led solutions to environmental problems and climate change.
Under the new CPS, ADB will support the government in realizing an ‘ecological civilization’ through environmental sustainability, pollution control, and climate change mitigation and adaptation measures. In particular, ADB will support operations that will produce regional public goods, benefitting a wider geographic area beyond the PRC. This includes helping the country achieve greenhouse gas emissions commitments ahead of its 2030 target; piloting projects to reduce air, water, and soil pollution; and promoting emerging renewable technologies such as solar power and carbon capture and storage. These activities will be based on the two memoranda of understanding between ADB and the PRC in the area of climate change and environmental protection signed in 2014, according to ADB.
ADB will also step up its support to the PRC’s regional cooperation and integration efforts, with ADB’s enhanced role as an honest broker. ADB will also focus on the inclusiveness of the PRC’s development by paying particular attention to the remaining poor, as well as gender issues.
Particular emphasis is placed on the ADB-PRC partnership in the area of knowledge. Knowledge work underpins and is an integral part of ADB’s sovereign and nonsovereign lending operations in the PRC. The knowledge partnership with the PRC includes stronger knowledge creation and use within the PRC, as well as dissemination of the PRC’s development experiences to other ADB developing member countries.
ADB will also help strengthen regulatory and legal frameworks, support the government’s efforts to improve governance to promote greater transparency, and enhance public sector management in areas such as taxation, local government bonds, and debt management. It will encourage private sector development by improving the legal framework, removing entry barriers, and supporting tariff reform, while promoting public-private partnerships through advisory work, regulatory and institutional reform, financing, and capacity building.
This year marks the 30th anniversary of ADB operations in the PRC. Between 1986 and the end of 2015, the PRC received 226 ADB public sector loans totaling $31.08 billion, $5.68 billion for nonsovereign projects, and $460.0 million in grants.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region.