The Global Economic Crisis
Implications for Asia-Pacific and ADB
Updated: 19 November 2009

Update on ADB's Response to the Global Economic Crisis

ADB is acting promptly and decisively to meet the needs of its developing member countries (DMCs) affected by the global economic crisis. ADB remains focused on its areas of comparative strength, knowledge, and experience. ADB's crisis-related assistance will largely continue in the core operational areas under its long-term strategic framework 2008-2020.

ADB's crisis-related lending is expected to increase by more than $10 billion in 2009-2010, bringing total ADB assistance for these two years to about $32 billion. This compares with about $22 billion in 2007-2008. The $10 billion increase in lending comprises $1 billion for trade finance, $3 billion for the Countercyclical Support Facility and about $6 billion to extend loans such as those for infrastructure investment. ADB will also expand its crisis-related support through grants for policy analysis and capacity building.

ADB established a $3 billion Countercyclical Support Facility (CSF) [ PDF ] that will provide short-term, fast-disbursing loans to support DMCs supplement their fiscal spending to counter the crisis, amidst tight global credit conditions and sharp increase in funding costs.

Given severe resource constraints faced by low-income countries, ADB approved an additional liquidity of $400 million to ADF-only countries with unanimous support from the ADF donors. ADF borrowers are also allowed to front-load their entire 2009-2010 biennial allocation.

ADB is also adopting a flexible approach for loans programmed before the crisis by making adjustments to better match the current financial and economic needs of each borrowing country.

In addition to its funding support, ADB is providing nonlending assistance for policy dialogue, policy advice for government officials at the country level, subregional and economic analysis and forecasts for the Asia and Pacific region. ADB is also working closely with the ASEAN Secretariat to multilateralize the Chiang Mai initiative, and establish a credit guarantee and investment mechanism as a trust fund to provide its members access to the Asian bond market for additional funding.