ADB ready to assist member countries to face financial crisis - Country Director

The Asian Development Bank (ADB) is ready to assist its member countries to face the financial crisis, ADB Country Director Richard Vokes said last week in Colombo.

At a presentation on ADB's 40-year operations in Sri Lanka, Vokes said that the ADB has already approved emergency loans to Bangladesh and several other countries.

Vokes said that Sri Lanka has failed to achieve its full potential in economic development.

In the 1980s there was no big difference between Sri Lanka and the East Asian countries such as Thailand and Malaysia.

The conflict clearly undermined the long term development of the country. Neglected infrastructure, lack of investment and change of Governments and policy uncertainty are the other reasons for lagging behind, he said.

Sri Lanka, one of the 31 founder members of the ADB in 1966 is the 16th largest shareholder in the region and 24th largest shareholder among 67 member countries. Sri Lanka received its first ADB loan in 1968.

The US$ 2 million loan was obtained to modernise tea factories.

Since then, Sri Lanka has obtained US$ 4.48 billion for 142 public and private sector loans and US$ 96.2 million for 229 technical assistance projects.

Initially, the ADB assistance was concentrated on agriculture and natural resources.

Today, the ADB assists sectors such as power, transport infrastructure, water supply, and sanitation and education.

Since 2001, the ADB provides extensive support to reconstruction of the North-East and tsunami reconstruction.

The recently finalised Sri Lanka Country Partnership Strategy (CPS) is focused on backing strong fiscal management and infrastructure development.

Under the new three-year CPS, the ADB is committing $ 630 million in loans for public sector operations, while overall aid growth for assistance is expected to be higher with additional funds raised through private sector operations, public private partnerships and co-financing.

ADB is a multilateral development bank with AAA credit rating.

The ADB raises funds mainly from the international capital market and with AAA ratings the ADB can raise funds at relatively lower rates, Vokes said. Earlier, the ADB raised capital from the US, Japan and European markets. However, today the situation has changed and today it raises funds from Korea, China and India as well, he said.

In its long-term framework 2020, the ADB has focused on several key areas in the development of the Asia Pacific region.

By 2012, 80% of annual approvals will support operations in infrastructure, environment, regional cooperation and integration, finance sector development and education.

By 2020, half of the ADB assistance will support private sector development in the region. GW