ADB launches new strategy

ADB launches new strategy

MANILA (AFP); Asia's premier development bank on Thursday launched a new strategy aimed at strengthening the role of the private sector as the driving force to sustain the region's recovery from financial crisis.

The new strategy announced by the Asian Development Bank (ADB) is seen as a complement to its main thrust of reducing the region's massive poverty because it can free much-needed government funds for health services, education and social safety nets.

"The strategy consists of a systematic and coherent framework that will guide the ADB's activities to promote private sector development across the region," the Manila-based regional institution said in a statement.

Under the scheme, ADB will work toward three main aims: creating the conditions for business to thrive, generating business opportunities and catalyzing private investments.

One major focus is rooting out corruption to encourage investments.

"There is no greater disincentive to business than the feeling of uncertainty and vulnerability brought about by corruption, abuse of discretion and bureaucratic interference," the bank said.

It vowed to help promote effective governance in both the private and public sectors.

In the private sector, the bank said it aimed to "promote good governance through various means such as reviews of commercial laws and regulations and establishment of credible accounting and auditing standards."

Developing a well-functioning financial system is another thrust, the bank said.

This would include support for policy reforms, enhancing regulation and supervision, establishing sound banking systems and the development of a deeper and broader securities market.

To balance development goals with commercial interests, the bank said it will work toward greater involvement of private firms in fields such as energy, water, waste water treatment, transport, telecommunications and even in the social sectors.

ADB also will work to involve the private sector in regional and subregional projects, saying that "regional and subregional cooperation has emerged as an increasingly important strategy for development in Asia."

The bank said earlier this month that Asia had recovered faster than expected from the 1997 financial turmoil, but cautioned against becoming complacent because risks still remained.

One of the risks was the ballooning budget deficits of governments which had to take a larger role in stimulating economies as private firms stung by the crisis slackened on investments.

ADB is subscribed to by 57 member countries, the largest donors being Japan and the United States.