ADB to adopt more selective lending strategy

ADB to adopt more selective lending strategy

MANILA (AFP): The Asian Development Bank (ADB) said Wednesday it is to adopt a more selective lending approach in a major strategic shift in its long-term goal of reducing the region's massive poverty.

"The context in which ADB will operate over the next decade or so will be dramatically different from that of the 1990s," the ADB said in a statement issued at the launch of the bank's new long-term strategic framework.

Shoji Nishimoto, director of the ADB's strategy and policy department, said the bank "will continue to play a large role in helping its developing member countries" reach overall goals of reducing poverty by half between 1990 and 2015.

But he said that to broaden and deepen the impact of core poverty reduction interventions, the ADB would promote the role of the private sector in mobilizing resources to address the region's development needs.

"The development challenges of the region are far beyond the capacities of any one institution," Nishimoto said in the statement.

ADB's new agenda "will enable us to be selective in our investments and to take a long-term approach," he said.

It would "focus our resources on the things we do best, and to be more efficient in our operations."

Nishimoto said ADB operations would focus on achieving sustainable economic growth, "inclusive" social development that targets women and disadvantaged groups, and "governance for effective policies and institutions."

The bank would provide support for legal and judicial reform and public accountability, he added.

Last year, ADB's total lending was US$5.8 billion, including concessional loans of $1.6 billion. Nearly all loans were to governments.

Clay Wescott, ADB's senior public administration specialist, told AFP last month that under the new framework, the bank will put pressure on governments to improve their performance by tying soft loans to their effectiveness and reform efforts.

The bank's lending system for these funds is now based solely on population and per capita gross domestic product, with special consideration given to small island states and landlocked nations.

Nishimoto said Wednesday that the ADB would also support regional cooperation and integration, as well as put environmental considerations in the forefront of development planning so as to reverse the "enormous and costly environmental degradation and damage that have already occurred."

The bank said it first reoriented its operational priorities in the early 1980s.

The 1990s ushered in another change, when the bank began to put more emphasis on social infrastructure, projects targeted at the poor, and projects to improve the environment.