Astana, Kazakhstan, May 4
By Daniyar Mukhtarov - Trend:
The Asia and Pacific region has achieved a lot in economic growth and poverty reduction, however, a number of global challenges may still pose a threat, president of the Asian Development Bank (ADB), Takehiko Nakao said at the 47th annual meeting of the ADB Board of Governors on May 4.
"The region's macroeconomic frameworks are more robust. Financial systems are well capitalized and foreign reserves are higher. The exchange rate regimes are more flexible. I am confident that by making a strong commitment to continue sound macroeconomic policies and address long term structural issues, the region will become even more resilient," Nakao said.
"We project the region's growth to edge up to 6.2 percent in 2014 and to 6.4 percent in 2015," the ADB president added.
"Looking ahead, the region should benefit from continued strong domestic demand, as well as better economic prospects in industrial countries," Nakao stressed adding that however, some risks remain.
"These can be related to changes in monetary policies of advanced economies and the possible slowdown of some regional economies. However, the overall downside risks are easing. In addition, developing Asia is in a much better position now to weather any potential shocks than before," the ADB president stressed.
The biggest challenge in the region remains poverty reduction, according to the ADB president.
"More than 700 million people live below the extreme poverty line of $1.25 a day. This accounts for 20 percent of the total Asian population and as much as 60 percent of the world's poor," Nakao said.
But Asia has done well in translating high growth into poverty reduction and using the measure of $1.25 a day, we are likely to see an end to poverty in the region within the next decade, the ADB president added.
"But this threshold ($1.25) is well over 10 years old, and not in line with the aspirations of people in the Asia and Pacific region today. It cannot support even a minimum standard of living in most Asian countries," Nakao stressed.
"Actually, more than 1.6 billion people live on less than $2 a day. They are highly vulnerable to job loss, inflation and crop failure. Inequalities within and between countries in the region are also increasing."
Nakao underscored that the challenge for ADB is to help developing member countries eradicate remaining poverty, and support greater inclusiveness to address inequalities.
"ADB must sharpen its operational focus to better help its clients overcome challenges," the bank's president added.
"ADB will increase its emphasis on inclusiveness and the quality of growth. We will expand our operations in education, health, social protection and inclusive business. Greater emphasis will be put on closing gender gaps through investment in girls' education and income earning opportunities for women."
"ADB will help countries to improve governance and build capacities to ensure effective, timely and corruption-free delivery of social services," Nakao said.
"ADB will continue to strongly support mitigation efforts, but we will also put much more emphasis on adaptation. The region is experiencing more frequent - and more severe - climate-related disasters. Going forward, ADB will integrate disaster risk prevention and management more strategically into its operations," the bank's president stressed.
As for development of business initiatives, Takehiko Nakao underscored that in addition to supporting connectivity through hard infrastructure such as cross-border roads and electricity, ADB will increase support for trade facilitation through simplifying custom procedures and harmonizing national standards.
ADB will also support regional financial integration to promote investment using the region's own resources, according to Nakao.
A strong private sector is essential for development, the bank's president stressed.
"It can fill large investment gaps, create jobs and reduce poverty. In addition to being a project financier, ADB should become a more active project developer. In this regard, we will expand our support for public-private partnerships. This will help mobilize more private sector investment and improve the delivery of public services."
As the largest development institute in Asia, the ADB must reform itself in order to respond to all the challenges with "reformed and innovational solutions", the bank head added.
"To be successful, ADB needs strong partnerships with all its members, civil societies and other development partners. Working together in partnership, with focus and firm resolve, we can achieve our shared goal of a better life for all people in Asia and the Pacific," Nakao said.