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Asian Development Bank President Tadao Chino, in his address to the ADB Board of Governors during the Annual Meeting in Shanghai on Friday, reaffirmed the ADB's commitment to Sri Lanka's rehabilitation and peace efforts.

"Earlier this year, immediately after the ceasefire, I visited a conflict-stricken area in northern Sri Lanka. My visit demonstrated the commitment of ADB, along with other development partners, to assist the Government in post-conflict rehabilitation and achieving lasting peace," Chino said.

Chino stressed that the ADB would lead the fight against poverty in Asia. "The ADB is firmly committed to an Asia and Pacific region free of poverty. Because Asia is home to two-thirds of the world's poor, the fight against global poverty must be won here in this region."

Focusing attention on the state of the Asian economy, Chino said the developing member countries (DMCs) recovered strongly from the Asian financial crisis of 1997-98, recording an average growth rate of 6.4 per cent in 1999 and seven per cent in 2000.

The year 2001, however, saw a synchronised global economic slowdown, and the tragic events of September 11 adversely affected many DMCs across the Asia and Pacific region. As a result, aggregate growth slowed to 3.7 per cent.

In contrast to the generally weak performance of 2001, the economic news has been encouraging in 2002 and provides the basis for a stronger medium-term growth outlook in Asia and the Pacific, he added.

These trends contribute to an improved economic outlook for developing Asia. Aggregate economic growth for developing Asia is expected to strengthen during 2002 and 2003, and Asia will continue to be one of the fastest growing regions of the world.

Despite these upward trends, several risks remain. Externally, they include the pace of recovery of the global economy as well as oil price levels. On the domestic front, sustained recovery depends on the implementation of policy and structural reforms, particularly in the financial and corporate sectors. ADB will continue to work closely with its DMCs to accelerate the reform process to help the region grow and prosper in an increasingly competitive global economy.

"Last year was an year of enormous challenges, but under your guidance and with your strong support, ADB responded effectively to the needs of its DMCs, and strengthened its institutional capacity to achieve its over-arching goal of poverty reduction, he told the Board of Governors.

"Many of the major challenges facing our DMCs are reflected in the Millennium Development Goals. The three challenges I wish to highlight today are reducing poverty, addressing environmental degradation, and promoting regional cooperation. ADB is working closely with its DMCs and development partners to address these challenges.

"Poverty reduction is the greatest challenge facing developing Asia and the Pacific. ADB's mission is to reduce poverty in its broadest dimension and within a desirable time frame. Our DMCs share this commitment as well as our vision of an Asia and Pacific region free of poverty. However, developing Asia is still home to two-thirds of the world's poor. Achieving the ultimate Millennium Development Goal of eradicating extreme poverty depends first and foremost on the reduction of poverty in Asia."

Chino observed that continued economic growth is required to maintain progress in reducing poverty. To achieve this, he said "we need structural reforms, technological progress, sufficient investment, and financial stability. The private sector is the engine of growth. Given the huge infrastructure requirements of the region, ADB's Private Sector Development Strategy calls for a more active involvement of the private sector, including public-private partnerships".

The Asian experience also shows that regional cooperation can be a powerful means to minimise the risks of globalisation. One good example of risk management through regional cooperation is ADB's support for regional information exchange and economic surveillance within ASEAN and ASEAN+3. At the sub-regional level, ADB is actively supporting several initiatives, including the Greater Mekong Sub-region programme, the South Asia Sub-regional Economic Cooperation programme, and the Central Asia Regional Economic Cooperation programme.

"My conviction is all nations and all people of Asia-indeed all people everywhere-should live together, work together, grow together, and deepen mutual cooperation. For this can surely lead to a better Asia, to a better world. It is my firm intention that ADB should be at the very centre of the global endeavour to realise a world where all can live with dignity and hope," Chino concluded.

Meanwhile, large and small Asian economies called on private sector investors to help develop their power sectors and accelerate economic growth.

At a seminar on Electricity Sector Reforms in Asia held before the 35th Annual Meeting of the Asian Development Bank (ADB), energy ministers of Bangladesh, People's Republic of China, India, and the Philippines presented diverse scenarios of their countries' power needs and solutions. But they expressed a common view that privatisation and deregulation are essential in power development.

The private sector expressed the need for governments to stay out of the power sector. Colin Tam, president of the International Power Producers Association, challenged governments to give up their shareholdings in the industry and focus instead on regulatory functions.

The ADB meeting also focused attention on Asia's mega cities. By 2020, the proportion of urban dwellers will rise to 50 per cent, with the city population reaching two billion. About half of these will be poor people residing in slums. This projection was made by Warren Evans, the Director of the Asian Development Bank's Environment and Social Safeguard Division, at a media briefing during ADB's 35th Annual Meeting of the Board of Governors.

Yet Asia's developing countries are only experiencing the beginning of this remarkable shift of people and economic activity from agrarian communities to urban and industrial centres. There will be at least 153 cities in Asia with populations over one million. Eighteen of the 27 mega cities - cities with over 10 million people - will be in Asia.

This transformation has been accompanied by phenomenal economic growth in many countries. A recent ADB study concludes that governments must return to planned and managed growth of the urban sector. Secondary cities need better infrastructure and other incentives to slow down growth in the primary cities which in turn have minimum investment needs to avoid environmental and public health disasters. More than likely, most of Asia's primary cities will not be pleasant places for residents in the near future and would contain large slums.

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