The 2011 Development Effectiveness Review (DEfR), ADB's fifth annual performance report by Management, found that ADB made further progress toward its Strategy 2020 targets, and that reforms are succeeding. The report also identified weaker areas and outlined the remedial actions to be taken.

Ensuring a secure supply of food is essential, given the world's (and especially Asia's) growing population, high and volatile food prices, increasingly scarce resources, and changing environment. This paper discusses the drivers behind food insecurity in Asia and points to ways to mitigate it.

The purpose of this set of highlights from ADB’s 2012 Annual Meeting’s Knowledge Sharing and Partnership Events (KSPE) is to share a snapshot of the key issues emerging from the KSPE program. Through the various seminars offered during the meeting, we heard from an impressive set of distinguished panelists on the key development and economic issues facing the Asia and Pacific region and the world. By leveraging technology, we provided new opportunities for audience members to become part of the conversation, which resulted in a highly interactive Governors’ Seminar.

This monograph aims to stimulate debate on the measures available to policymakers to dampen the effects of any abrupt economic shocks should recovery in the United States fail to gain traction or if the sovereign debt problems plaguing Europe were to escalate into a full-blown crisis. In addressing current issues, it is imperative to also focus on pursuing the long-term goal of sustaining Asia's growth momentum and consolidating its economic and social transformation. How Asia responds to the current crisis and ongoing global structural transformation is critical, including how it pursues inclusive and sustainable growth in a manner that uplifts the welfare of the majority of its people.

Asia is at a crossroads. As the world's most populous region, with high economic growth, a rising share of global greenhouse gas emissions, and the most vulnerability to climate risks, Asia must be at the center in the global fight against climate change. Simply stated, Asia's current resource- and emission-intensive growth pattern is not sustainable, with further gains in human well-being constrained by the environmental carrying capacity. This study recognizes low-carbon green growth as an imperative–not an option–for developing Asia.

Economic relations between Asia and Latin America and the Caribbean (LAC) have clearly reached a turning point at the turn of the 21st century. In a mere decade, the manufacturing prowess and insatiable hunger for natural resources of Asia's two most populous economies—the People's Republic of China and India—coupled with LAC's reemergence, have made Asia LAC's second largest trading partner. At the same time, this dynamic trade relationship has significantly increased LAC's strategic and economic importance to Asia.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice out and seek solutions to their problems, and report alleged noncompliance of ADB's operational policies and procedures. It consists of two separate but complementary functions: consultation and compliance review.

The 2011 Annual Report of the Board of Directors to the Board of Governors reviews ADB's operations, projects, internal administration, and financial management. It includes a separate report on the activities of the Special Funds of ADB. The report also contains chapters on regional, sectoral, and thematic highlights.

This publication about ADB's nonsovereign operations explains ADB's approach to catalyzing and strengthening private sector investments in Asia and the Pacific.

While Asia has seen faster poverty reduction accompanying rapid economic growth compared with the rest of the world, the Philippine experience has been a glaring exception, as growth has generally been slower and poverty has actually risen even with record economic growth. The Asian Development Bank has identified four critical constraints as having impeded Philippine economic growth: (i) tight fiscal situation; (ii) inadequate infrastructure, particularly in electricity and transport; (iii) weak investor confidence due to governance concerns; and (iv) inability to address market failures leading to a small and narrow industrial base. In light of this, dramatic improvements in revenue generation, infrastructure provision, and enterprise development assume central importance in the government's economic policy agenda. The study identifies needed measures supporting these thrusts, along with key sector growth drivers that would ensure both accelerated growth and broad-based participation and benefits within the economy. But all these will have little success without a governance and institutional reform agenda that would restore the public's overall trust in government, the lack of which has led to low tax compliance, inhibited investment, and in turn constrained growth of the economy through the years. Overcoming this will require decisive actions on several fronts from the new Aquino administration.

The Asia Bond Monitor (ABM) reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. The ABM covers the 10 Association of Southeast Asian Nations member countries plus the People's Republic of China; Hong Kong, China; and the Republic of Korea.

The Asia Bond Monitor (ABM) reviews recent developments in East Asian local currency bond markets along with the outlook, risks, and policy options. The ABM covers the 10 Association of Southeast Asian Nations member countries plus the People's Republic of China; Hong Kong, China; and the Republic of Korea.

Despite weak global demand, Asian Development Outlook 2012 expects developing Asia to largely maintain its growth momentum in the next couple of years in an environment of easing inflation for most regional economies, although policy makers must be alert to further oil price spikes arising from threats of oil supply disruptions. The report sees that the greatest risk to the outlook is the uncertainty surrounding the resolution of sovereign debt problems in the eurozone. Still, in the absence of any sudden shocks, developing Asia can manage the effects on its trade flows and financial markets.

Economic challenges in developing Asian countries have become more complex: urban populations are growing at great cost to the environment; climate change has increased risks of natural disasters; and income gaps within and between developing countries are widening. These factors threaten the sustainable growth and development of urban areas, the drivers of Asia's economy. A strategic approach for inclusive growth is needed. The City Cluster Economic Development approach provides a strategic framework and a set of analytical tools that governments, businesses, and communities can use to support the inclusive and sustainable development of competitive urban economies in Asia. Said approach was developed and tested by the Asian Development Bank to improve the basis for integrated planning and development of urban regions in Asia and the Pacific. It also helps urban managers and other city stakeholders identify action plans and determine priority investment areas.

This edition of Development Asia looks at the state of disaster preparedness in the region, the economics of risk mitigation and the politics of disaster relief, and proactive strategies and innovative solutions. We put the spotlight on Bangladesh, long a victim of recurring disasters, where a community-led program has dramatically reduced disaster-related deaths and damage. In The Big Voice, Margareta Wahlstrom, who heads the United Nation's Secretariat for the International Strategy for Disaster Reduction, talks about the challenges of preaching preparedness. On the fund-raising side, we examine the sometimes controversial role that celebrities have played in rallying international support for disaster victims. On a lighter note, we also explore how the tiny seahorse is helping reduce poverty in coastal communities across the region, and chime in about the musical traditions of international development.

The private sector is regarded as a major contributor to economic growth through investments, new technologies, knowledge transfer, and enhanced productivity, as well as through the creation of jobs and income. This is particularly true in Asia and the Pacific, where much of the recent success in reducing poverty has been due to robust economic growth stimulated by the private sector. The Private Sector Operations Department of the Asian Development Bank promotes growth by providing direct assistance to the private sector.

Despite being the world's most economically dynamic region, Asia and the Pacific remains home to two-thirds of the world's poor. To help realize its vision of an Asia and Pacific region free of poverty, the Asian Development Bank (ADB) must apply its limited resources in a way that delivers the best possible development results.

This publication presents a snapshot of the environmental strategies, programs, initiatives, partnerships, and a range of activities of the Asian Development Bank (ADB) that demonstrate its commitment to support environmentally sustainable growth in Asia and the Pacific—a strategic agenda of ADB's Strategy 2020. The report highlights innovations designed in selected ADB-supported projects with environmental sustainability as a theme that were approved in 2008–2010. It also discusses the emerging environmental challenges in the region, and previews ADB's strategies to strengthen its operational emphasis on the environment, including climate change, that would help realize green growth in Asia and the Pacific.

Using both quantity- and price-based measures of financial integration, this paper shows an increasing degree of financial openness and integration in emerging Asian markets. This paper also assesses the impact of a regional shock relative to a global shock on local equity and bond markets. The findings of this paper suggest that the region's equity markets are integrated more globally than regionally, although the degrees of both regional and global integration have increased significantly since the 1997/98 Asian financial crisis. However, emerging Asia's local currency bond markets remain generally segmented, being neither regionally nor globally integrated. A case can be made for the benefits of increased regional integration of financial markets. Financial integration at the regional level allows for the region's economies to benefit from allocation efficiency and risk diversification. The findings of this paper suggest that policy makers in the region must strike the right balance between maximizing the net benefits from regional and global financial openness, and minimizing the potential costs of financial contagion and crisis.

The Pacific developing member countries of the Asian Development Bank (ADB) are a diverse array of countries with widely varying topographies, cultures and economies, fragile natural resource environments, and prosperity, stability, and security that can be compromised by the impacts and consequences of climate change. The Pacific island governments view climate change as a priority issue, especially in terms of its potential impacts on food security, and need clear directions in addressing both issues. This report describes the present state of food security and its contributing factors in the Pacific region, assesses its prospects amid the growing threats and likely impacts of climate change, and presents potential areas for more active assistance, investments, and interventions from ADB and other development partners. While technical and policy measures to ensure food security amid the ensuing climate change are numerous, interrelated, and complex, the successful implementation of programs and projects calls for simple and flexible designs that carefully consider the capabilities of relevant stakeholders at the regional, national, and local levels.

The specter of high commodity prices has recently reemerged, with global food prices registering a new peak in February 2011, triggered mainly by production shortfalls due to bad weather. The 30% hike in international food prices has translated to an average domestic food price inflation in developing Asia of about 10%. This could push an additional 64.4 million Asians into poverty, or lead to a 1.9 percentage point increase in poverty incidence based on the $1.25-a-day poverty line. The frequency with which food price spikes have occurred in recent years suggests that short- and long-term solutions need to be implemented to secure food supplies for the world's growing population.

This report describes an evolving policy landscape characterized by a changing economic reality, rising demand for resources, increasingly apparent impacts of environmental and climate change, and increased risk and uncertainty. It provides new insights into the resource use trends of Asia and the Pacific and outlines key actions, including reforming economic incentives and promoting more inclusive and adaptive governance approaches, that governments can pursue to help closely align economic growth strategies sustainable development. It also provides examples of strategies for improving resilience to help deal with the increasing levels of risk faced by societies and economies.

This publication presents a step-by-step methodological approach to assist project teams to incorporate climate change adaptation measures into transport sector investment projects. While the focus of the publication is on the project level, an improved understanding of climate change impacts should also be used in the design of infrastructure planning and development policies and strategies to ensure appropriate resource allocation. Though the transport sector includes roads, waterways, rails, and airborne transport, this publication focuses solely on road infrastructure.

The Asian Development Fund (ADF) is the main concessional window of the Asian Development Bank for supporting poverty reduction in its poorer developing member countries in Asia and the Pacific. It is funded by international donors on a grant basis and has been replenished every 4 years since it was established in 1974. The current replenishment (ADF X, for 2009–2012) is the ninth. From 2001–2010, ADB approved $20 billion in ADF loans and grants for 29 countries, the most sizable of which were given to Bangladesh, Viet Nam, Pakistan, Afghanistan, and Nepal.

The Asian Development Bank (ADB) introduced the Managing for Development Results (MfDR) agenda in 1999 as a part of its commitment to enhance development effectiveness under the overarching goal of its Poverty Reduction Strategy. In 2003, ADB formally established the Results Management Unit to integrate results-based management into operations. More than a decade later, the move into the next phase of MfDR—monitoring and managing results on the ground to achieve development effectiveness—should be imminent. A special evaluation study on MfDR from ADB's Independent Evaluation Department brings out key findings and recommendations that need to be addressed in this regard. This edition of Learning Lessons highlights the key lessons and issues in mainstreaming the Managing for Development Results Agenda within ADB, and make recommendations ensure better development effectiveness of operations in the future.

Reducing poverty is a universal goal. But countries are also finding that it is not enough to reduce poverty, and that growing inequality—of opportunities and in outcome—can make growth socially and politically unsustainable. In the face of increasingly tight resource constraints, maintaining high growth rates is becoming harder unless it is environmentally and socially sustainable, and it originates broadly from across the human resource base.

Drawing on nationwide consultations with the private sector in the Philippines, this publication identifies inefficient state processes and inadequate business environment as the major reasons for such insufficient synergy.

ADB launched a review in February 2010 to assess the 2005 Public Communications Policy's efficacy and to recommend changes as necessary to improve and strengthen it. The review engaged interested individuals and organizations. Consultation drafts were released in June and November 2010. Extensive discussions of the policy were held with a wide range of stakeholders in a number of ADB member countries within and outside Asia and the Pacific. ADB also conducted two global surveys of its stakeholders to gauge their perceptions of ADB's performance and communications.

The increasing occurrence of national, regional, and global financial crises, together with their rising costs and complexity, has increased calls for greater regional and global monetary cooperation. This is particularly necessary in light of volatile capital flow movements that can quickly transmit crisis developments in individual countries to other countries around the world. Global financial safety nets are one important area for monetary cooperation. This paper reviews the current situation of regional and global monetary cooperation, focusing on financial safety nets, with a view toward developing recommendations for more effective cooperation, especially between the International Monetary Fund (IMF) and regional financial arrangements.

This report, jointly prepared by ADB and the Peterson Institute for International Economics, aims to provide strategic guidance for emerging Asia's participation in the G20 and related discussion about reform of global economic governance. The recent global financial crisis underscored the fact that the spirit of cooperation is key to successful reform. Without tighter coordination between old and emerging powers, it will be hard to find lasting solutions to pressing global problems. The rise of emerging market economies heralds a new world order. Yet consolidating the new voices and soliciting a sense of ownership from them pose a real challenge. This report draws on important lessons from the crisis to offer policy recommendations in areas of imminent challenge confronting the leaders from both old and emerging powers.

This revised edition of Strengthening Participation for Development Results: A Staff Guide to Consultation and Participation (2006) offers updated information and an expanded range of tools to support ADB staff and stakeholders to implement participatory approaches effectively. The updated content reflects ADB's new business processes and highlights key opportunities for participation in policy dialogue and throughout the project cycle, and advises on methods and approaches, as well as pitfalls to avoid. In this edition, special attention is given to safeguards, gender, governance, HIV/AIDS and infrastructure, and water and sanitation. A wealth of participation resources developed by a wide range of organizations exists online; this guide includes an inventory of references for those seeking further information.

As witnessed during the 1997/98 Asian financial crisis, the dependency on short-term foreign capital for long-term investment made the region vulnerable to the sudden reversal of capital inflows. Rapid capital outflows not only caused the collapse of the financial system; a sharp economic contraction also caused millions of citizens to fall below the poverty line and reversed overnight the gains in poverty alleviation that had taken decades for governments in the region to achieve. To mitigate against risks associated with the sudden stop of capital inflows, the Association of Southeast Asian Nations (ASEAN) and the People's Republic of China, Japan, and the Republic of Korea—collectively known as ASEAN+3—have been working together to develop local currency bond markets to mobilize domestic savings to finance long-term investment and strengthen the resilience of the financial system in the region. The first regional initiative designed to achieve this endeavor was the Asian Bond Market Initiative (ABMI), launched by ASEAN+3 in 2002. The second was Asian Bond Fund 1 and 2, launched in 2003 and 2005, respectively, by EMEAP economies. The Asian Development Bank has provided support to ASEAN+3, as the secretariat, to facilitate the implementation of the policy actions promoted under ABMI. This paper reviews the progress made under ABMI over the past 10 years, particularly the progress made in mobilizing domestic savings for investment. The paper then proposes measures for ASEAN+3 economies to more effectively channel domestic savings for investment and stimulate domestic demand to help modify growth patterns and improve savings–investment imbalances.

This report discusses key policy challenges that need to be addressed if the Philippines were to embark on sustainable and inclusive growth. We take the view that the main reason behind the Philippines' lagging growth and development outcomes in the regional context lies in a sluggish transformation of the economy—in particular, stagnant industrialization. Chronic problems of unemployment, poverty, and low investment are reflections of weak industrial development. The economy has been led by services, and it has been further shifting toward services with the growing business process outsourcing. Nevertheless, sole development of the services sectors is not sufficient to address the development challenges and lead to inclusive growth. We propose more targeted public sector support, which focuses on specific industries and products for industrial upgrading and diversification. This report shows a methodology of choosing products for targeted public sector support, and recommends effective dialogue between the public and private sectors to identify constraints specific to the target products and to develop adequate solutions. The Philippines needs to develop a stronger industrial base to enable the economy to "walk on two legs" of industry and modern services, to create productive job opportunities for the growing working-age population.

This brochure lists the three main products of the Trade Finance Program, its advantages, a case study from Viet Nam, and the program summary.