"Investing in Asia's Urban Future"
Opening Remarks By
Ursula Schaefer-Preuss
Vice President, Knowledge Management and Sustainable Development
Asian Development Bank
At the Changing Context of ADB's Engagement with Urban Asia
5 February 2007
ADB Headquarters, Mandaluyong City
Introduction
Dear Vice Minister Karin Kortmann, distinguished guests, ladies and gentlemen: It is a pleasure to welcome you to Manila for this Conference on Investing in Asia's Urban Future.
Asian urbanization is a global problem which should be central to donor's agendas. For national governments, it is central to efficient and sustained economic growth and poverty reduction. The future development of Asian Cities is of critical importance not only for Asia, but also for the global economy and for the global environment and last but not least for the Social Habitat.
Challenges Facing Asian Cities
City regions and mega-cities - those with 10 million or more inhabitants - serve as magnets for people, enterprise and culture. In the next 20 years, another 1.1 billion people will live in Asia's already congested cities. Without effective urban management, this growth will only exacerbate the existing problems of pollution, lack of potable water, slums and traffic congestion, among others. Though Asian cities on average provide 80% of the economic base of the economy, large disparities have emerged as poverty has urbanized. Today, over 200 million people live in poverty in Asia's cities and many more are vulnerable to economic and environmental shocks.
These serious and growing problems have overwhelmed urban managers. The response cannot be simply business-as-usual. We need to develop new modes for engagement in this sector, reflecting new roles and types of clients. Today's responses must address the factors key to a sustainable future: economic, environmental and social.
Challenges for the Development Community
All of this poses serious challenges to the development community . We need to support change management at both national and city levels. We need to coordinate delivery of assistance among agencies, and ensure that our assistance is output and objective oriented and delivered with a long term perspective to achieve required change in organizational culture. We need to work more with and through local development institutions. We need to integrate the involvement of local and international private sector participants in projects, and establish coordinated networks of practice to share information, innovations and best practices.
ADB has a long history of working with the urban sector. Around 10% of ADB's lending has been for urban sector projects, both in amount and number of loans - over $11 billion in total. Our new Urban Services Initiative aims to reshape our engagement in the sector to deliver the technical and financial resources needed to respond effectively to client needs. In particular, ADB has introduced new lending products including sub-sovereign lending, local currency financing, and refinancing, among others, which are suited for application in this sector.
Cities Development Initiative for Asia
The envisaged initiative is an important step forward. We believe that a well-coordinated, multi donor initiative can contribute significantly towards improving the living conditions of people in Asian cities. To that end, the Cities Development Initiative for Asia (CDIA) would facilitate international dialogue, training and advice in order to help Asia's urban decision-makers build their problem-solving capacity, to support them in preparing municipal infrastructure investment, and to assist in finding financiers.
The CDIA is an innovative way to address the key elements of the Paris Declaration - upscaling investments in the urban sector, fostering ownership, aligning support with national priorities, harmonizing systems of support, and providing for clear and monitorable outcomes. CDIA gives cities the central role in firstly, determining what approach they will take to building coordination, financial management and procurement capacities to compliment programs of assistance; secondly, how they will pool and coordinate among donors so as to most effectively deliver that assistance; and thirdly, how they will ensure the assistance produces the desired outcomes.
The CDIA will provide technical support to cities in areas where current modes of development assistance are unavailable. As urban projects are multi-faceted and multi-sectoral, many activities are involved in planning, establishing the enabling framework for, and strengthening the institutions involved in, investment projects. In particular, the CDIA will provide support for:
- National urban strategies;
- Strengthening Agencies prior to implementation;
- Financial structuring, due diligence and negotiation; and
- Implementation.
The long-term outcomes of the CDIA will be improved incomes and a better quality of life for Asia's urban citizens. The CDIA will also reduce the impact of city growth on the global environment. It is estimated that by 2015, CDIA operations associated with ADB could help to improve the lives of 200 million people, over half of whom are poor, and assist ADB and other development partners to mobilize at least $10 billion in urban investments. This will occur through the preparation of investments in sanitation, urban transport, waste management and any other urban infrastructure. The preparation process, resourced through CDIA, will ensure that these programs and projects are designed aiming at the needs of the poor as a priority.
Conclusion
Let me close by wishing the conference well in its deliberations. In particular, I hope that our clients from our Developing Member Countries will tell us clearly and forthrightly where we could do things better in the urban sector, and suggest how this might be incorporated into CDIA. The lives of millions of poor, and the sustainability of Asian economic and social development, rest on such efforts. Thank you very much.
News and Events 
Top of page
