ADB meeting to focus on Asian poverty
ADB meeting to focus on Asian poverty
Erin Prelypchan, Reuters, Shanghai
The Asian Development Bank holds its 35th annual meeting this
week in China's booming commercial hub of Shanghai, the country's
richest city whose smart bridges and newly clean riverfront are
testament to hundreds of millions of dollars in ADB loans.
China's growing success in sucking in private sector capital
has hemmed its need for ADB funds. But its triumphs will likely
spur calls by the multilateral agency for faster and deeper
structural reform in less developed corners of Asia.
Afghan reconstruction, currency swaps, trade pacts, and
keeping the Asian economic recovery on the boil will be among
other hot topics for the 3,000 delegates due in Shanghai.
The 60-member ADB board, which includes 43 Asia Pacific
finance officials, will also discuss a U.S. proposal to increase
aid given to needy nations as grants, as opposed to loans.
The Manila-based ADB has forecast growth in developing Asia of
about 4.8 percent this year and 5.8 percent in 2003, well down
from an average annual 7.7 percent in the 1980s and 8.1 percent
in the first half of the 1990s.
But while much of the region crawls out of a global economic
slowdown amid lingering bad debt problems from the 1997-98 Asian
crisis, coastal Chinese cities like Shanghai are flush with
glittering skyscrapers, bustling streets and thriving ports.
Shanghai saw GDP growth of more than 10 percent last year and
is the main entry point for China's US$40 billion-plus in annual
foreign investment.
The ADB sees China's GDP growing 7.0 percent in 2002, a
dizzying rate so appealing to foreign investors that Asia's
finance ministers and central bankers will want to know how to
emulate or weather it.
Shanghai's glitter will not distract ADB President Tadao Chino
from his campaign on Asian poverty, which he has termed the
"single, overarching goal" of the multilateral agency.
Japan will likely use the conference to pledge fresh funds to
the ADB antipoverty trust which Tokyo launched in 2000 with a
donation of 10 billion yen ($78.6 million).
Afghanistan will also feature highly. The ADB has pledged $500
million over two-and-a-half years in assistance for the
reconstruction of the war-ravaged country.
The assistance programmer will focus on the crippled farm
sector, education, roads and power generation. A $200 million ADB
loan is expected to be processed by late August with disbursement
soon after.
Bruised by the 1997-1998 Asian financial crisis, finance
ministers of the 10-member Association of Southeast Asian Nations
(ASEAN) plus Japan, South Korea and China will likely use a
meeting on Friday to strengthen a network of currency swaps.
The Chiang Mai Initiative, signed in May 2000, sees currency
swaps as a defense against future speculative attacks. Japan has
already signed bilateral swaps with Thailand, China, Malaysia,
South Korea and the Philippines.
ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia,
Myanmar, the Philippines, Singapore, Thailand and Vietnam.
China's economic juggernaut will be hard for delegates to
ignore when they meet in Shanghai's showpiece financial hub of
Pudong, whose striking office towers and broad avenues were muddy
farmland only 12 years ago.
China's relative political stability, low labor costs and the
world's biggest market of 1.3 billion people suck in half of
developing Asia's foreign direct investment, economists estimate.