Annual Report 2007

In keeping with ADB’s ongoing and comprehensive reform agenda, the Board of Directors undertook a series of reviews that expanded ADB’s capacity to assist member countries, and to do so more efficiently and with better results. It endorsed new country partnership strategies with several countries, and paid special attention to the situation and challenges facing the region’s weakest and most vulnerable economies and societies.

The Board also supported revisions to ADB’s grant framework linking a country’s eligibility for grants to its debt status, and explored more appropriate and more reliable ways of assessing creditworthiness.

To strengthen ADB’s internal capabilities and institutional effectiveness, the Board pressed on with reforms intended to bolster ADB’s financial position, improve the capabilities of its staff, and enable ADB to operate more efficiently. These reforms were made even more urgent by the continuing growth in ADB’s operations: the total loan portfolio approved by the Board in 2007 exceeded $10 billion for the first time.

With the second medium-term strategy period drawing to a close and the new long-term strategic framework set to take effect in 2008, the Board was acutely aware of the need to realign ADB’s policies and programs with the emerging new scenario in the Asia and Pacific region.

Board Meetings

The Board meetings covered a broad range of policy, financial, and administrative concerns, among them, ADB’s approach to engaging with weakly performing countries and to providing debt relief to heavily indebted poor countries.

The Board reviewed ADB’s prudential exposure limits on nonsovereign operations, the 1998 graduation policy, and the loan charges and allocation of 2006 net income. It discussed possible revisions in the framework for Asian Development Fund (ADF) grants and the borrowing program for 2008.

The Board met on ADB’s annual financial statements, its budget for 2008, its work program and budget framework (2008–2010), and the salaries and benefits for national officers and administrative staff at headquarters, as well as those for professional staff.

It reviewed the 3-year rolling work program for 2008–2010 and budget for 2008 of the Asian Development Bank Institute. It discussed a paper on the resources of ADB and recommended its consideration by the Board of Governors at the Fortieth Annual Meeting.

Other Meetings

In September, a delegation from the World Bank’s Board of Directors met with ADB’s Board of Directors to discuss board effectiveness and other issues of mutual interest.

In October, the ADB Board held a retreat with Management to discuss the long-term strategic framework. The retreat proved helpful in getting early feedback on the framework.

Members of the Board also attended the first donors’ meeting on the ninth replenishment of the ADF (ADF X) in Sydney, Australia, in September, and the second meeting in Vientiane, Lao People’s Democratic Republic, in November.

Country Partnership Strategies

The country partnership strategy or CPS (formerly the country strategy and program) maps out the ways that ADB can best partner with its member countries over the time frame of the CPS (usually 5 years), given each country’s situation, challenges, and priorities. The CPS also enables ADB to evaluate the country’s development performance over the CPS period.

The Board endorsed three CPSs—for the Maldives (2007–2011), Thailand (2007–2011), and Tonga (2007–2012)—as well as a joint country support strategy for the Kyrgyz Republic (2007–2010).

Board Group Visits

Members of the Board made two visits around the region to get a firsthand view of ADB projects and their impact, and to meet with government officials and other development stakeholders.

On 15–28 February, a team visited Papua New Guinea, Solomon Islands, and Vanuatu. Another team visited Uzbekistan and the Kyrgyz Republic on 16–26 June.

The visits strengthened ADB’s relationship with its development partners and generated valuable feedback.