Evaluation Lessons of a Global Financial Crisis for Asia and ADB
As Asia and the Pacific recovers from the 2008-2009 global financial crisis, the distress engulfing European economies is stoking fears of a new storm battering the region's exports and restricting financial resource flows. Concerned about a crisis governments in Asia are preparing their defenses and might seek financial support and policy advice from ADB. This brief discusses the potential risks to Asia from a crisis in Europe, and lessons from evaluation on crisis response support provided by ADB and other international financial institutions.
Evaluations of the responses to the 2008-2009 global financial crisis by ADB and other international financial institutions provide valuable lessons. For crisis response, evaluation-based lessons place the greatest stress on preparation by developing countries, ADB, and the Independent Evaluation Department (IED).
- For ADB's developing member countries, the priorities are ensuring (i) fiscal sustainability through aggressive public expenditure management; (ii) robust systems for social protection, and targeting social protection on vulnerable households; and (iii) sufficient capital adequacy in the financial system to counter shock-related stress.
- For ADB, the priorities are for investing in (i) forecasting systems to better anticipate the risks of external shocks and identify needed actions; (ii) knowledge, resources, and instruments to support country priorities; and (iii) relationships with clients and partners to strengthen and speed up ADB support.
- For IED, the priority is to pursue operational learning through timely evaluations of ADB support, and quickly getting the lessons out to countries and ADB staff. This may require a strategic rebalancing of IED's work program, especially with respect to the mix between project evaluations and the more thematic evaluations.