Asia urged to rethink growth policies amid crisis
AP Associated press
By STEPHEN WRIGHT , 05.03.09, 02:14 AM EDT
Asia's governments must spend more on social safety nets and reduce their reliance on export-driven growth even as they grapple with an economic meltdown that will keep tens of millions trapped in poverty, finance officials said Sunday.
Faced with the worst global slump since World War II, many of Asia's economies are in free fall as demand for their exports - long the engine of the region's growth - evaporates in big Western markets.
The Asian Development Bank, holding its annual meeting in Bali, Indonesia, has warned that 61 million people will remain trapped in extreme poverty this year because of the global slump. That figure will increase to nearly 160 million if slow growth continues next year, it says.
The bank's president Haruhiko Kuroda said the collapse in global trade has "gathered momentum" as export markets suffer a massive contraction.
"This grave situation needs more vigorous and concerted efforts by all concerned to bring growth in the region back," he said.
Some governments in Asia, Japan and China's among them, are already blasting their economies with hundreds of billions of dollars in stimulus spending. But it is too early to say whether this pump-priming is working, while many other governments in the region are too poor to fund such largesse.
"Asian countries must restructure their economies and focus more on domestic demand," Japan's Finance Minister Kaoru Yosano told the annual meeting.
"The Asian region needs to prop up domestic demand to avoid economic meltdown," said Yosano, also a governor of the ADB, to which Japan is a major donor.
Boosting Asia's spending on social protection - currently the lowest of any region - is a crucial step to take for boosting confidence and reducing the human cost of an economic downturn, he said.
The venue for the May 2-5 meeting, an international convention center nestled amid plush five-star resorts, provides a stark contrast to one of its main talking point: tackling Asia's endemic poverty.
Some hotels hosting conference delegates have nightly rates that are more than a poor family in Asia earns in one year. More than 900 million in Asia live on $1.25 or less a day.
"The accommodation is indicative of the bank's efforts in meeting the financial crisis," said Red Constantino, executive director of NGO Forum on ADB - an umbrella group pushing the bank to become more accountable. "There's a wide gap between their rhetoric and what they do in reality."
The ADB announced Saturday that it will boost lending to the region's poorest nations by more than $10 billion over two years, though it is widely acknowledged this is not enough to make up for the shortfall created by the freezing up of private investment.
The announcement came just days after the bank's 67 member countries approved a tripling of the ADB's capital to $165 billion, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector.
"We expect the bank to rapidly and significantly step up lending in key areas," said India's economic affairs secretary Ashok Chawla.
But activist organizations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated. The ADB estimates about 12,000 people would need to be resettled.
Copyright 2009 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed
http://www.forbes.com/feeds/ap/2009/05/03/ap6370442.html
Increased ADB capital to hike ecological damage
MANILA, Philippines - The Asian Development Bank’s (ADB) decision to triple its capital base may lead to a corresponding increase in social and environmental harm across the region, a group which monitors the lender’s activities said.
The ADB’s capital hike “could easily translate into a more than 200 percent increase in social and environmental harm," the NGO Forum on ADB said in a statement datelined Bali, Indonesia.
The announcement was made on Saturday during the ADB’s 42nd annual meeting which opened on the same day in Bali. During the event, community representatives reportedly questioned ADB president Haruhiko Kuroda about the fund hike’s implications, given the region’s experience of forced displacement and environmental degradation caused by ADB projects.
On Thursday, the ADB’s Board of Governors agreed to triple ADB’s capital base from $55 billion to $165 billion, which will allow the lender to “substantially increase its support to countries affected by the global downturn," the bank said in a statement. Earlier, the ADB said that the purpose of the capital increase is to help the poorest countries in Asia to meet the United Nations’ Millennium Development Goals (MDGs), which intends to halve global poverty, among others.
However, the move is “irresponsible" and “dangerous," Red Constantino, executive director of the NGO Forum on ADB said, citing the ADB’s long-term strategic framework called Strategy2020. The capital hike will only allot funds to private sector clients and big infrastructure projects, “which do not translate into benefits reaching the poorest of the poor, and instead often exacerbates inequality," the group said.
In Nepal, local communities and organizations are raising significant concerns about the proposed ADB-funded West Seti Hydropower Project, a massive proposed dam for one of the most remote and ecologically sensitive areas of Nepal, the group said.
Over 30,000 people will be affected by this project and at least 20,000 will be forced to move from their traditional lands and homes, the group added, saying that the proposed resettlement sites are the homelands of indigenous Tharu people.
“The ADB is planning to move tens of thousands of people onto our lands but there has been no free, prior, informed consent from Tharu people," Said Raj Kumar Leky, Secretary General, Tharu Welfare Society.
“For over a decade we have been asking and asking for a complete copy of the environmental impact assessment in local languages," said Ratan Bhandari, whose family will be relocated from their ancestral lands if the project goes forward.
“Our people have never been told that the land they will be moved to may be contaminated by arsenic and is aleady occupied by Tharu people. There has been a stunning lack of consultation about this project which will devastate our environment and local livelihoods," Bhandari added.
This has prompted Stephanie Fried of Environmental Defense Fund to say that “these social and environmental failings are not unique to West Seti."
The same failures “are reported by communities impacted by ADB-financed projects across the Asia-Pacific region," she said in the same statement issued by the NGO Forum on ADB.
“Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?" she said.
“In the midst of global calls for increased regulations around financing, the ADB will be going against the current if is does not strengthen its social and environmental safeguard policies," said Joanna Levitt of the International Accountability Project in the same statement. “Without real improvements, we can expect to see more reckless use of Bank funds, resulting in more disastrous projects." -
GMANews.TV
Bank watchdog raises alarm on ADB’s general capital increase NGOs warn that increased funds will equal increased harm
2 May 2009, BALI – The NGO Forum on the Asian Development Bank today challenged the multilateral bank’s move for a general capital increase (GCI), calling it irresponsible and dangerous.
The ADB’s 42nd annual meeting opened today, with community representatives questioning ADB president Haruhiko Kuroda about the implications of the increased funds, given the region’s experience of forced displacement and environmental degradation caused by ADB projects.
The Forum is calling on the Bank’s Governors to take extreme caution with the institution’s general capital increase. “If not managed well, this 200% general capital increase could easily translate into a more than 200% increase in social and environmental harm,” warned Red Constantino, Executive Director of NGO Forum on ADB.
According to the ADB, the purpose of the capital increase is to help the poorest countries in Asia to reach the Millennium Development Goals. However, this claim has been slammed by Bank monitors citing that the increase is largely planned to go toward private sector clients and big infrastructure, as described in the Bank’s Strategy2020, the ADB’s long-term strategic framework. Numerous studies have shown this type of financing does not translate into benefits reaching the poorest of the poor, and instead often exacerbates inequality.
“In the midst of global calls for increased regulations around financing, the ADB will be going against the current if is does not strengthen its social and environmental safeguard policies,” said Joanna Levitt of the International Accountability Project. “Without real improvements, we can expect to see more reckless use of Bank funds, resulting in more disastrous projects.”
In Nepal, local communities and organizations are raising significant concerns about the proposed ADB-funded West Seti Hydropower Project, a massive proposed dam for one of the most remote and ecologically sensitive areas of Nepal. Over 30,000 people will be impacted by this project and at least 20,000 will be forced to move from their traditional lands and homes. The proposed resettlement sites are the homelands of indigenous Tharu people. “The ADB is planning to move tens of thousands of people onto our lands but there has been no free, prior, informed consent from Tharu people,” Said Raj Kumar Leky, Secretary General, Tharu Welfare Society.
“For over a decade we have been asking and asking for a complete copy of the environmental impact assessment in local languages,” said Ratan Bhandari, whose family will be relocated from their ancestral lands if the project goes forward. “Our people have never been told that the land they will be moved to may be contaminated by arsenic and is aleady occupied by Tharu people. There has been a stunning lack of consultation about this project which will devastate our environment and local livelihoods. “
“These social and environmental failings are not unique to West Seti, but are reported by communities impacted by ADB-financed projects across the Asia-Pacific region,” said Stephanie Fried of Environmental Defense Fund. “Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?”
The NGO Forum on ADB is a 250-strong Asian-led network of civil society organizations that has been monitoring the ADB’s programs, policies and projects since 1992. #
http://www.engagemedia.org/Members/ricoloco/news/bank-watchdog-raises-alarm-on-adb2019s-general-capital-increase
ADB pledges $10 billion lending push
Posted on » Sunday, May 03, 2009
BALI, Indonesia: The Asian Development Bank (ADB) announced yesterday it will boost lending to the region's poorest nations by more than $10 billion over two years and warned that the global economic crisis is jeopardising the UN's goal to halve poverty by 2020.
The announcement comes just days after the bank's 67 member countries approved a tripling of its capital to $165bn, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector.
Yesterday the bank's president, Haruhiko Kuroda, told an annual meeting in Bali, that loans for Asia's developing nations will rise to $32bn over this and next year from $22bn in the previous two years.
The lending will "assist faltering economies and most importantly, protect the poor from the worst impacts of the crisis," he said.
It includes a $3bn fund that the hardest-hit governments can tap to boost their own fiscal stimulus spending as they battle the downturn.
Activist organisations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
"If not managed well, this 200pc general capital increase could easily translate into a more than 200pc increase in social and environmental harm," said NGO Forum on ADB executive director Red Constantino.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated.
GULF DAILY NEWS
Asia urged to rethink growth policies
BALI, Indonesia- Asia's governments must spend more on social safety nets and reduce their reliance on export-driven growth even as they grapple with an economic meltdown that will keep tens of millions trapped in poverty, finance officials said Sunday.
Japan also announced a $60.5 billion currency swap scheme that could be tapped by Asian nations facing a liquidity squeeze. Faced with the worst global slump since World War II, many of Asia's economies are in free fall as demand for their exports long the engine of the region's growth evaporates in big Western markets.
The Asian Development Bank, holding its annual meeting in Bali, Indonesia, has warned that 61 million people will remain trapped in extreme poverty this year because of the global slump. That figure will increase to nearly 160 million if slow growth continues next year, it says. The bank's president Haruhiko Kuroda said the collapse in global trade has "gathered momentum" as export markets suffer a massive contraction.
"This grave situation needs more vigorous and concerted efforts by all concerned to bring growth in the region back," he said. Some governments in Asia Japan and China's among them are already blasting their economies with hundreds of billions of dollars in stimulus spending. But it is too early to say whether this pump-priming is working, while many other governments in the region are too poor to fund such largesse.
"Asian countries must restructure their economies and focus more on domestic demand," Japan's Finance Minister Kaoru Yosano told the annual meeting. "The Asian region needs to prop up domestic demand to avoid economic meltdown," said Yosano, also a governor of the ADB, to which Japan is a major donor.
Boosting Asia's spending on social protection currently the lowest of any region — is a crucial step to take for boosting confidence and reducing the human cost of an economic downturn, he said. Separately, Yosano said Japan will set up a yen currency swap scheme worth $60.5 billion, giving nations with weaker currencies access to yen in the event of a liquidity squeeze.
The state-run Japan Bank for International Cooperation will also help developing nations borrow money by guaranteeing up to $5 billion of yen denominated bonds issued by such countries. On the sidelines of the ADB meeting, finance ministers from the Association of Southeast Asian Nations along with Japan, China and South Korea are expected to finalize enlarging an emergency currency pool that has yet to be set up to $120 billion.
The venue for the May 2-5 meeting, an international convention center nestled amid plush five-star resorts, provides a stark contrast to one of its main talking point: tackling Asia's endemic poverty. Some hotels hosting conference delegates have nightly rates that are more than a poor family in Asia earns in one year. More than 900 million in Asia live on $1.25 or less a day. "The accommodation is indicative of the bank's efforts in meeting the financial crisis," said Red Constantino, executive director of NGO Forum on ADB an umbrella group pushing the bank to become more accountable. "There's a wide gap between their rhetoric and what they do in reality."
The ADB announced Saturday that it will boost lending to the region's poorest nations by more than $10 billion over two years, though it is widely acknowledged this is not enough to make up for the shortfall created by the freezing up of private investment. The announcement came just days after the bank's 67 member countries approved a tripling of the ADB's capital to $165 billion, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector. "We expect the bank to rapidly and significantly step up lending in key areas," said India's economic affairs secretary Ashok Chawla. But activist organizations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated. The ADB estimates about 12,000 people would need to be resettled.
USA Today, 3 May 2009.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed
By STEPHEN WRIGHT , 05.03.09, 02:14 AM EDT
Asia's governments must spend more on social safety nets and reduce their reliance on export-driven growth even as they grapple with an economic meltdown that will keep tens of millions trapped in poverty, finance officials said Sunday.
Faced with the worst global slump since World War II, many of Asia's economies are in free fall as demand for their exports - long the engine of the region's growth - evaporates in big Western markets.
The Asian Development Bank, holding its annual meeting in Bali, Indonesia, has warned that 61 million people will remain trapped in extreme poverty this year because of the global slump. That figure will increase to nearly 160 million if slow growth continues next year, it says.
The bank's president Haruhiko Kuroda said the collapse in global trade has "gathered momentum" as export markets suffer a massive contraction.
"This grave situation needs more vigorous and concerted efforts by all concerned to bring growth in the region back," he said.
Some governments in Asia, Japan and China's among them, are already blasting their economies with hundreds of billions of dollars in stimulus spending. But it is too early to say whether this pump-priming is working, while many other governments in the region are too poor to fund such largesse.
"Asian countries must restructure their economies and focus more on domestic demand," Japan's Finance Minister Kaoru Yosano told the annual meeting.
"The Asian region needs to prop up domestic demand to avoid economic meltdown," said Yosano, also a governor of the ADB, to which Japan is a major donor.
Boosting Asia's spending on social protection - currently the lowest of any region - is a crucial step to take for boosting confidence and reducing the human cost of an economic downturn, he said.
The venue for the May 2-5 meeting, an international convention center nestled amid plush five-star resorts, provides a stark contrast to one of its main talking point: tackling Asia's endemic poverty.
Some hotels hosting conference delegates have nightly rates that are more than a poor family in Asia earns in one year. More than 900 million in Asia live on $1.25 or less a day.
"The accommodation is indicative of the bank's efforts in meeting the financial crisis," said Red Constantino, executive director of NGO Forum on ADB - an umbrella group pushing the bank to become more accountable. "There's a wide gap between their rhetoric and what they do in reality."
The ADB announced Saturday that it will boost lending to the region's poorest nations by more than $10 billion over two years, though it is widely acknowledged this is not enough to make up for the shortfall created by the freezing up of private investment.
The announcement came just days after the bank's 67 member countries approved a tripling of the ADB's capital to $165 billion, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector.
"We expect the bank to rapidly and significantly step up lending in key areas," said India's economic affairs secretary Ashok Chawla.
But activist organizations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated. The ADB estimates about 12,000 people would need to be resettled.
Copyright 2009 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed
http://www.forbes.com/feeds/ap/2009/05/03/ap6370442.html
Increased ADB capital to hike ecological damage
MANILA, Philippines - The Asian Development Bank’s (ADB) decision to triple its capital base may lead to a corresponding increase in social and environmental harm across the region, a group which monitors the lender’s activities said.
The ADB’s capital hike “could easily translate into a more than 200 percent increase in social and environmental harm," the NGO Forum on ADB said in a statement datelined Bali, Indonesia.
The announcement was made on Saturday during the ADB’s 42nd annual meeting which opened on the same day in Bali. During the event, community representatives reportedly questioned ADB president Haruhiko Kuroda about the fund hike’s implications, given the region’s experience of forced displacement and environmental degradation caused by ADB projects.
On Thursday, the ADB’s Board of Governors agreed to triple ADB’s capital base from $55 billion to $165 billion, which will allow the lender to “substantially increase its support to countries affected by the global downturn," the bank said in a statement. Earlier, the ADB said that the purpose of the capital increase is to help the poorest countries in Asia to meet the United Nations’ Millennium Development Goals (MDGs), which intends to halve global poverty, among others.
However, the move is “irresponsible" and “dangerous," Red Constantino, executive director of the NGO Forum on ADB said, citing the ADB’s long-term strategic framework called Strategy2020. The capital hike will only allot funds to private sector clients and big infrastructure projects, “which do not translate into benefits reaching the poorest of the poor, and instead often exacerbates inequality," the group said.
In Nepal, local communities and organizations are raising significant concerns about the proposed ADB-funded West Seti Hydropower Project, a massive proposed dam for one of the most remote and ecologically sensitive areas of Nepal, the group said.
Over 30,000 people will be affected by this project and at least 20,000 will be forced to move from their traditional lands and homes, the group added, saying that the proposed resettlement sites are the homelands of indigenous Tharu people.
“The ADB is planning to move tens of thousands of people onto our lands but there has been no free, prior, informed consent from Tharu people," Said Raj Kumar Leky, Secretary General, Tharu Welfare Society.
“For over a decade we have been asking and asking for a complete copy of the environmental impact assessment in local languages," said Ratan Bhandari, whose family will be relocated from their ancestral lands if the project goes forward.
“Our people have never been told that the land they will be moved to may be contaminated by arsenic and is aleady occupied by Tharu people. There has been a stunning lack of consultation about this project which will devastate our environment and local livelihoods," Bhandari added.
This has prompted Stephanie Fried of Environmental Defense Fund to say that “these social and environmental failings are not unique to West Seti."
The same failures “are reported by communities impacted by ADB-financed projects across the Asia-Pacific region," she said in the same statement issued by the NGO Forum on ADB.
“Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?" she said.
“In the midst of global calls for increased regulations around financing, the ADB will be going against the current if is does not strengthen its social and environmental safeguard policies," said Joanna Levitt of the International Accountability Project in the same statement. “Without real improvements, we can expect to see more reckless use of Bank funds, resulting in more disastrous projects." -
GMANews.TV
Bank watchdog raises alarm on ADB’s general capital increase NGOs warn that increased funds will equal increased harm
2 May 2009, BALI – The NGO Forum on the Asian Development Bank today challenged the multilateral bank’s move for a general capital increase (GCI), calling it irresponsible and dangerous.
The ADB’s 42nd annual meeting opened today, with community representatives questioning ADB president Haruhiko Kuroda about the implications of the increased funds, given the region’s experience of forced displacement and environmental degradation caused by ADB projects.
The Forum is calling on the Bank’s Governors to take extreme caution with the institution’s general capital increase. “If not managed well, this 200% general capital increase could easily translate into a more than 200% increase in social and environmental harm,” warned Red Constantino, Executive Director of NGO Forum on ADB.
According to the ADB, the purpose of the capital increase is to help the poorest countries in Asia to reach the Millennium Development Goals. However, this claim has been slammed by Bank monitors citing that the increase is largely planned to go toward private sector clients and big infrastructure, as described in the Bank’s Strategy2020, the ADB’s long-term strategic framework. Numerous studies have shown this type of financing does not translate into benefits reaching the poorest of the poor, and instead often exacerbates inequality.
“In the midst of global calls for increased regulations around financing, the ADB will be going against the current if is does not strengthen its social and environmental safeguard policies,” said Joanna Levitt of the International Accountability Project. “Without real improvements, we can expect to see more reckless use of Bank funds, resulting in more disastrous projects.”
In Nepal, local communities and organizations are raising significant concerns about the proposed ADB-funded West Seti Hydropower Project, a massive proposed dam for one of the most remote and ecologically sensitive areas of Nepal. Over 30,000 people will be impacted by this project and at least 20,000 will be forced to move from their traditional lands and homes. The proposed resettlement sites are the homelands of indigenous Tharu people. “The ADB is planning to move tens of thousands of people onto our lands but there has been no free, prior, informed consent from Tharu people,” Said Raj Kumar Leky, Secretary General, Tharu Welfare Society.
“For over a decade we have been asking and asking for a complete copy of the environmental impact assessment in local languages,” said Ratan Bhandari, whose family will be relocated from their ancestral lands if the project goes forward. “Our people have never been told that the land they will be moved to may be contaminated by arsenic and is aleady occupied by Tharu people. There has been a stunning lack of consultation about this project which will devastate our environment and local livelihoods. “
“These social and environmental failings are not unique to West Seti, but are reported by communities impacted by ADB-financed projects across the Asia-Pacific region,” said Stephanie Fried of Environmental Defense Fund. “Globally, this is a real opportunity to rethink development finance. Will the ADB use its capital increase in a responsible manner or will it continue business as usual at the cost of local people and the environment?”
The NGO Forum on ADB is a 250-strong Asian-led network of civil society organizations that has been monitoring the ADB’s programs, policies and projects since 1992. #
http://www.engagemedia.org/Members/ricoloco/news/bank-watchdog-raises-alarm-on-adb2019s-general-capital-increase
ADB pledges $10 billion lending push
Posted on » Sunday, May 03, 2009
BALI, Indonesia: The Asian Development Bank (ADB) announced yesterday it will boost lending to the region's poorest nations by more than $10 billion over two years and warned that the global economic crisis is jeopardising the UN's goal to halve poverty by 2020.
The announcement comes just days after the bank's 67 member countries approved a tripling of its capital to $165bn, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector.
Yesterday the bank's president, Haruhiko Kuroda, told an annual meeting in Bali, that loans for Asia's developing nations will rise to $32bn over this and next year from $22bn in the previous two years.
The lending will "assist faltering economies and most importantly, protect the poor from the worst impacts of the crisis," he said.
It includes a $3bn fund that the hardest-hit governments can tap to boost their own fiscal stimulus spending as they battle the downturn.
Activist organisations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
"If not managed well, this 200pc general capital increase could easily translate into a more than 200pc increase in social and environmental harm," said NGO Forum on ADB executive director Red Constantino.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated.
GULF DAILY NEWS
Asia urged to rethink growth policies
BALI, Indonesia- Asia's governments must spend more on social safety nets and reduce their reliance on export-driven growth even as they grapple with an economic meltdown that will keep tens of millions trapped in poverty, finance officials said Sunday.
Japan also announced a $60.5 billion currency swap scheme that could be tapped by Asian nations facing a liquidity squeeze. Faced with the worst global slump since World War II, many of Asia's economies are in free fall as demand for their exports long the engine of the region's growth evaporates in big Western markets.
The Asian Development Bank, holding its annual meeting in Bali, Indonesia, has warned that 61 million people will remain trapped in extreme poverty this year because of the global slump. That figure will increase to nearly 160 million if slow growth continues next year, it says. The bank's president Haruhiko Kuroda said the collapse in global trade has "gathered momentum" as export markets suffer a massive contraction.
"This grave situation needs more vigorous and concerted efforts by all concerned to bring growth in the region back," he said. Some governments in Asia Japan and China's among them are already blasting their economies with hundreds of billions of dollars in stimulus spending. But it is too early to say whether this pump-priming is working, while many other governments in the region are too poor to fund such largesse.
"Asian countries must restructure their economies and focus more on domestic demand," Japan's Finance Minister Kaoru Yosano told the annual meeting. "The Asian region needs to prop up domestic demand to avoid economic meltdown," said Yosano, also a governor of the ADB, to which Japan is a major donor.
Boosting Asia's spending on social protection currently the lowest of any region — is a crucial step to take for boosting confidence and reducing the human cost of an economic downturn, he said. Separately, Yosano said Japan will set up a yen currency swap scheme worth $60.5 billion, giving nations with weaker currencies access to yen in the event of a liquidity squeeze.
The state-run Japan Bank for International Cooperation will also help developing nations borrow money by guaranteeing up to $5 billion of yen denominated bonds issued by such countries. On the sidelines of the ADB meeting, finance ministers from the Association of Southeast Asian Nations along with Japan, China and South Korea are expected to finalize enlarging an emergency currency pool that has yet to be set up to $120 billion.
The venue for the May 2-5 meeting, an international convention center nestled amid plush five-star resorts, provides a stark contrast to one of its main talking point: tackling Asia's endemic poverty. Some hotels hosting conference delegates have nightly rates that are more than a poor family in Asia earns in one year. More than 900 million in Asia live on $1.25 or less a day. "The accommodation is indicative of the bank's efforts in meeting the financial crisis," said Red Constantino, executive director of NGO Forum on ADB an umbrella group pushing the bank to become more accountable. "There's a wide gap between their rhetoric and what they do in reality."
The ADB announced Saturday that it will boost lending to the region's poorest nations by more than $10 billion over two years, though it is widely acknowledged this is not enough to make up for the shortfall created by the freezing up of private investment. The announcement came just days after the bank's 67 member countries approved a tripling of the ADB's capital to $165 billion, expanding its ability to finance infrastructure and other projects aimed at reducing poverty in partnership with the private sector. "We expect the bank to rapidly and significantly step up lending in key areas," said India's economic affairs secretary Ashok Chawla. But activist organizations have not welcomed the bank's bigger firepower, saying ADB-funded projects often harm the very people they aim to help.
Activists highlighted an ADB-backed dam and hydroelectric power scheme in the West Seti region of Nepal, saying it could displace 20,000 people and lead to conflict in resettlement areas that are already heavily populated. The ADB estimates about 12,000 people would need to be resettled.
USA Today, 3 May 2009.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed
