Indonesia is ADB's top borrower

Indonesia is ADB's top borrower

MANILA (AFP): Indonesia was the top borrower of the Asian
Development Bank (ADB) in 1993 with US$1.293 billion in loans,
while energy and infrastructure got the lion's share of funds,
the bank said yesterday.

The Manila-based lender's 1993 annual report said that out of
$5.28 billion in loans approved last year, nearly 78 percent went
to development of energy resources and physical and social
infrastructure.

China was the number two debtor, receiving $1.05 billion,
while India got the biggest single loan, $300 million for a gas
flaring reduction project, said the report issued ahead of the
ADB annual meeting.

Net transfer of resources to the bank's borrowing members --
the difference between what they got in loans and what they
repaid and invested in the bank -- fell 20.5 percent in 1993 to
$938 million.

The bank also announced it realized a net income of $570
million in 1993, a seven percent annual increase, and had an
investment portfolio of $725 million, down from $937 million in
1992.

The ADB's roster of members rose to 55 last week with the
admission of the Kyrgyz republic, the second former Soviet
central Asian state to join the bank after Kazakhstan. Uzbekistan
has yet to complete formalities.

ADB member countries -- 39 from the region and 16 from outside
-- are expected to approve a 100 percent general capital increase
to about $48 billion at the annual meeting in Nice, France in
early May.

Cumulative lending reached $47.7 billion at the end of 1993.

Capital

Developing members of the ADB had pushed for the capital
increase with the support of Japan, but the United States and
other donors sought a policy review, leading to the ongoing
"spring cleaning" to weed out bad projects.

The capital hike has yet to be ratified by ADB member
countries, who are to meet early May in Nice, France.
Sato, elected ADB president last November, said up to 20 percent
of ADB projects, heavy on infrastructure, had been
"unsuccessful," but said this was still better than the track
record of similar institutions.

The annual report said ADB members should widen the private
sector's role in infrastructure projects, estimated to cost up to
$1 trillion until 2000, because "traditional sources" were drying
up.

Sato, a veteran Japanese finance ministry official and former
managing director of the Tokyo Stock Exchange, pledged to improve
"efficiency, transparency, accountability and responsibility" in
the bank.

The ADB will pursue a "50-50" rule setting aside half of
loanable funds for "soft" projects to attack poverty, save the
environment, check population growth, and improve women's lives
across the region, he said.

More than 700 million of the three billion Asians still live
in poverty despite its sustained economic boom, according to ADB
estimates.

Sato said another "very new challenge" is to assist members
shifting from centralized control to a market economy like China,
Mongolia, Vietnam, Cambodia, Laos and the former Soviet republics
like Kazakhstan, the Kyrgyz republic and Uzbekistan.

He said following dramatic growth in East and Southeast Asia
in the past two decades, new engines of regional expansion could
emerge in South India, particularly India, and Indochina, led by
Vietnam.