ADB concludes 45th annual meeting

The Asian Development Bank (ADB) today concluded the 45th Annual Meeting of its Board of Governors in Manila, Philippines and announced that the 2013 meeting will take place in Delhi, India.
ADB’s meeting in Manila from May 2 to 5 gathered a record number of more than 5,000 registered delegates including finance ministers and other key policymakers, business leaders, and academics. Civil society representatives and media also attended in record numbers.
Key issues at this year’s meeting included what Asia must do to adapt to the global economic downturn, build resilience in urban centers, promote green growth, ensure regional food security, and grow trade between Asia and Latin America.
The meeting took place against the backdrop of an Asia and Pacific region that has seen steady growth and is leading global recovery, but is vulnerable to growing inflation, spikes in fuel prices, austerity measures in the eurozone, and worsening impacts of climate change.
The region must update its growth model to accommodate a 'new normal' of prolonged economic restructuring in advanced economies, and remove obstacles to sustained and equitable growth in developing Asia, according to the How Can Asia Respond to Global Economic Crisis and Transformation? monograph presented at the Governors’ Seminar. The theme of “Inclusive Growth through Better Governance and Partnerships” provided a platform to discuss one of the region’s most pressing issues: how to bring the benefits of Asia’s rapid growth to
all levels of society, especially the poor. Determining how best to pursue inclusive growth can lead to sustainable growth, support greater levels of trade, and generate growth in tourism. Conversely, a weaker Asia presents a host of threats to global growth and prosperity.
ASEAN+3 also announced a doubling of the funds available under the Chiang Mai Initiative Multilateralisation, a pool of emergency liquidity for use in times of economic crisis, and the establishment of the ASEAN Infrastructure Fund, with an initial equity of $485 million to finance the development of regional road, rail, power, water and other critical infrastructure needs, which are estimated at  about $60 billion a year.
ADB also announced that it secured $12.4 billion for its concessional Asian Development Fund, a 9.5 per cent increase over the previous four-year period. The funds will be used to promote gender mainstreaming, good governance, food security, private sector development and the formation of a Disaster Response Facility.
The Board of Governors is ADB’s highest policy-making body and the annual meetings are statutory occasions at which Governors can provide guidance on ADB’s administrative, financial, and operational priorities. Next year's meeting will take place in Delhi, India from May 2 to 5 in 2013.

ADB secures more than $12bn to help Asia's poorest

The Asian Development Bank (ADB) has secured Special Drawing Rights 7.9 billion ($12.4 billion) for the next four-year phase of its concessional development fund that will provide critical financial support to fight poverty in the Asia and Pacific region.
The contributions to the Asian Development Fund (ADF), which will cover ADB operations from 2013 to 2016, represent an increase of 11.1 per cent in SDR (9.5 per cent in US dollar terms) from the fund’s previous four-year period.
"ADF borrowers face significant development challenges, and have fewer  resources of their own to address them. We particularly appreciate the strong support and generosity of our donor countries in view of the difficult challenges many are facing at home themselves,” said ADB president Haruhiko Kuroda.
The ADF will help improve the lives of millions of Asia’s poorest through inclusive and environmentally sustainable growth, including improved access to education, social safety nets and the development of clean and renewable energy. They will also seek to narrow the development gaps and rising income inequality, and help vulnerable countries cope with shocks such as rising food and fuel prices, natural disasters and conflict.
The ADF will also be used to promote gender mainstreaming, good governance, food security, private sector development, and stronger regional cooperation. Special attention will be given to countries affected by conflict and smaller island states with fragile economies.
Donors agreed to establish a Disaster Response Facility under ADF on a pilot basis to support the poorest countries in responding to natural disasters. The ADF continues to be a critical source of finance for badly needed economic and social infrastructure improvements. Over the next four-year period, for example, almost 16,000 kilometers of road are expected to be upgraded, opening up new economic opportunities and better access to social services for over 20 million people. More than 2.5 million students will benefit from school improvement programs or other direct support to the education sector. And many new households will be connected to electricity (over 340,000), served with water
supply (560,000) and sanitation (440,000).
"ADF support will go a long way in helping countries like Bangladesh provide critically needed social services to our citizens," said Bangladesh Finance Minister Abul Maal Abdul Muhith. "We will redouble our efforts to deliver results and bring better opportunities and a brighter future to our people, especially to the poorest communities."
Bangladesh is one of the largest recipients of ADF resources and was one of six ADF recipient countries who participated in the negotiations.
ADB has adopted various measures in recent years as part of its continuing efforts to improve the efficiency and effectiveness of its development assistance, including in its ADF operations. These include a results-focused management system, more flexible business processes, improved communication and accountability of policies and enhanced gender mainstreaming in its operations.

Nepal to get more support from Asian Development Fund

Based on the previous history of proper usages of resources, Nepal is eligible to receive more financial support from Asian Development Fund (ADF).
“Nepal is working towards minimising corruption and misuse of funds through different mechanisms like e-tendering and similar tools that will ensure the grants reach the targeted groups,” assured finance secretary Krishna Hari Baskota, addressing the donors, during the recent meeting of Asian Development Fund in Dhaka.
The country will be achieving tentative growth rate of five per cent, single digit inflation and is working towards increasing foreign currency reserve sufficient to bear the cost of import of service and goods for seven months, he said, adding that the sustained use of foreign aid has pushed Nepal closer to attaining majority of Millennium Development Goals (MDGs).
Along with an improved image on different frontiers and indicators like competitiveness will guarantee that the funds will not be misutilised, the finance secretary assured, pledging that Nepal is suitable to receive more financial assistance in future for its development works.
The country has, so far, received funds worth $1.3 billion from the Asian Development Fund that has been investing in infrastructure development, economic stability, governance, environmental issues, agriculture development, education, energy and other similar social and economic sectors contributing in improving living standard of Nepalis.
Nepal is fifth largest aid receiver from Asian Development Fund (ADF) which Bangladesh is the largest aid receiver with $3.2 billion.
However, donor countries asked the aid recipient countries to be more dependent on their internal sources for development works citing the contraction in their respective economies following the eminent recession. The meeting at Dhaka is the second round of tri-partite meeting between, Asian Development Bank (ADB), donor countries and the aid recipient countries.
The first round was conducted in Manila in September and the third one will once again be held in Manila in March 2011 that will decide the amount the donor countries will be providing to support the Asian developing countries.
Representatives from 28 donor countries including US, Japan, United Kingdom, Sweden, Norway, Germany, Australia, and France were present in the meeting along with the donor recipient countries including Nepal, Afganistan, Bang-ladesh, Mongolia, Solomon Islands and Vietnam.

Nepal targets overhaul of power network to reduce shortages, boost growth

Years of underinvestment in electricity infrastructure has left Nepal with one of the most unreliable power supplies in South Asia, putting a brake on the country’s economic growth.
In response, Asian Development Bank’s (ADB) Board of Directors has approved a loan of $65 million equivalent to strengthen and expand electricity transmission and distribution facilities in a bid to cut network losses and reduce frequent supply interruptions and outages, said the manila-based bank in its press release.
Funds will also be used to upgrade two hydropower plants, introduce compact fluorescent lamps, and install solar and solar-wind powered streetlights in a push to boost energy efficiency, increase the use of clean renewable technologies, and take some of the strain off the national grid. Public-Private franchising partnerships will be developed in selected urban areas to improve service quality to consumers, providing a model that could be replicated in future.
The Energy Access and Efficiency Improvement Project will support the Government of Nepal’s long-term vision to provide universal coverage using grid-based and off-grid supplies by 2027. Installed generating capacity at the end of 2008 was 615 MW with just 33 per cent of households connected to the national grid.
“The project will strengthen and increase supply capacity, increase consumer connections, improve the finances of the state-owned Nepal Electricity Authority, and eventually allow for increased cross-border energy trade, giving the economy a boost,” said Priyantha Wijayatunga, Energy Specialist in ADB’s South Asia Department.
An estimated 20,000 additional households are expected to directly benefit from the distribution improvements, while all 1.5 million grid-connected electricity consumers will receive more reliable power supplies. The installation of 1,000 solar and solar-wind streetlights in municipal areas of Bhaktapur, Kathmandu and Lalitpur will improve safety, particularly for women and children, while the project is expected to reduce an estimated 15,000 to 20,000 tons of carbon dioxide emissions annually.
ADB’s loan from its concessional Asian Development Fund covers 69% of the project cost of $93.7 million. The loan has a 32-year term, including a grace period of 8 years. Interest is charged at one per cent per annum during the grace period and 1.5 per cent per year for the rest of the term.
Grants totaling $4.5 million from the Climate Change Fund and Multi-Donor Clean Energy Fund, administered by ADB, will also be provided. The Government and Nepal Electricity Authority will supply the balance of $24.2 million. Nepal Electricity Authority is the executing agency for the project which is due for completion around September 2014.

Airports' upgrade in Nepal to increase safety, boost tourism

The Asian Development Bank (ADB) will help Nepal appeal to even more tourists through a project to improve the country's airports and civil aviation safety standards.
The ADB Board of Directors approved a total of $80 million – including a grant of $10 million and a loan of $70 million equivalent – to finance the Nepal Air Transport Capacity Enhancement Project.
The project will improve safety and capacity at Tribhuvan International Airport (TIA) in Kathmandu, and three domestic airports – Lukla, Rara and Simikot – that serve remote areas inaccessible by road. TIA, Nepal's only international airport, will be reconfigured and upgraded to international safety standards, with the project including provision for the construction of 1.4 km of new taxiways, a new power supply system, the refurbishment of its international terminal and the construction of a new temporary domestic terminal. The three domestic airports will receive improved communication equipment, visual approach aids, and weather equipment.
“Due to the challenging terrain in Nepal, air transport is an essential part of the country’s transport system, providing access to many remote towns and villages in the mountainous areas,” said Dong-Kyu Lee, Transport Specialist in ADB’s South Asia Department. “Providing safe and reliable aviation access to the country will attract more tourists and greatly contribute to Nepal’s economy."
With international and domestic passenger traffic expected to increase significantly in the next four years, the project will also seek to enhance the organisational effectiveness of the Civil Aviation Authority of Nepal, the regulatory body that controls the country's aviation industry. Existing regulations will be updated to meet international standards and viable opportunities for private sector participation in future airport developments will be identified.
ADB's grant and loan, from its concessional Asian Development Fund, covers 87 per cent of the project cost of $92 million. The Government of Nepal will contribute the remaining 13 per cent. The ADB loan has a 32-year term, including a grace period of eight years. Interest is charged at one per cent per annum during the grace period and 1.5 per cent per year for the rest of the term.
The Civil Aviation Authority of Nepal is the executing agency for the project, which is due for completion around the end of 2014.