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People's Republic of China (PRC) and ADB

ADB has moved from an infrastructure-based support model for the PRC to one that will improve the quality of economic growth by underlining environmental protection and social sector development.

ADB's Work in the People's Republic of China

ADB Membership

Joined 1986

Shareholding and Voting Power

Number of shares held:
684,000 (6.429% of total shares)

Votes:
723,114 (5.437% of total membership, 8.349% of total regional membership)

Overall capital subscription:
$9.46 billion

Paid-in capital subscription:
$473.08 million

ADB has been working with the People’s Republic of China (PRC) since 1986.

In 2019, the country celebrated its 70th anniversary as a people’s republic. It is now the second-largest economy globally and is fast approaching the ambitious goal of eliminating extreme poverty in 2020.

People enjoying the view of peach blossoms in Yuyuantan Park, Beijing

The PRC does, however, continue to face many development challenges such as promoting industrial transformation, mitigating environmental pollution and climate change, and dealing with population aging. ADB has been partnering with the PRC to address these challenges, in line with the country’s 13th Five-Year Plan (2016–2020). The PRC remains the bank’s second-largest sovereign borrower and is a major contributor to ADB development finance and knowledge-sharing initiatives.

Since 1986, ADB has committed sovereign loans totaling $37.15 billion and nonsovereign loans of $3.73 billion (excluding B loans) for the PRC. Cumulative loan and grant disbursements to the PRC amount to $31 billion. These were financed by regular ordinary capital resources and other special funds.

Since 1986, ADB has approved $37.15 billion in sovereign loans and $3.73 billion for private sector operations (excluding B loans) in the PRC. In 2019, the bank committed around $1.8 billion for 9 sovereign loans and $351 million for 4 nonsovereign loans (excluding B loans), supplemented by $20 million for 20 technical assistance projects.


ADB-Supported Projects and Programs

In 2019, ADB committed around $1.8 billion for nine sovereign loans and $351 million for four nonsovereign loans (excluding B loans) for the PRC. This was supplemented by $20 million (inclusive of cofinancing) for 20 technical assistance projects.

The bank signed a $200 million loan to foster inclusive green development in Ziyang municipality in Sichuan province. The project will improve the urban environment and livability for an estimated 3.6 million people and demonstrate how medium-sized cities in the middle and upper reaches of the Yangtze River basin can tackle ecological and green growth challenges.

Under ongoing support for the PRC to improve air quality, ADB signed a $392 million loan to promote advanced technologies for heating and cooling, helping cut about 4 million tons of carbon dioxide emissions annually and directly benefiting around 650,000 people in Shandong province. These new technologies have huge potential for scaling up and replication.

Everbright International Suzhou Municipal waste-to-energy plant

Addressing emerging social issues such as aging is a continuing priority in the PRC. ADB committed a $150 million loan to help develop a comprehensive elderly care system in Yichang, Hubei province, as a model to other cities on providing suitable care and efficient services for aging citizens.

Through a $192.8 million loan, ADB is helping to develop an innovative, smart, and intelligent transport system to reduce pollution, cut traffic congestion, and improve safety in Guizhou Gui’an.

Tai chi exercised for its health benefits and meditation at the People's Square, Urumqi.

To improve rural livelihoods and eradicate poverty, ADB committed a $130 million loan to provide smallholder farmers and cooperatives in Gansu province with access to e-commerce and markets for selling agricultural products. The investment will help ensure food safety and the competitiveness of agricultural goods.

As part of ADB’s support for the PRC’s rural vitalization strategy, the bank committed a $300 million loan to address environmental degradation and modernize agricultural production systems in five provinces and one municipality located in the upper and middle reaches of the Yangtze River basin.

Responding to a request from the National Development Reform Commission, ADB prepared position papers giving detailed research and policy recommendations for the PRC’s 14th Five-Year Plan. These papers focused on climate change, ecosystem services, rural vitalization, urbanization, inclusive development, the role of local government, and a broad paper on the development framework for the PRC’s modernization strategy.

Nonsovereign Operations

As a catalyst for private investments, ADB provides financial assistance to nonsovereign projects and financial intermediaries. Total commitments from ADB’s own funds (in equity and direct loans) in 2019 amounted to $3.00 billion for 38 transactions in economic and social infrastructure, the finance sector, and agribusiness. ADB also actively mobilizes cofinancing from commercial and concessional sources. In 2019, ADB mobilized $3.28 billion of long-term cofinancing and $3.69 billion of cofinancing in trade finance, microfinance, and supply chain finance programs. Total outstanding balances and commitments of nonsovereign transactions funded by ADB’s own resources stood at $13.78 billion as of 31 December 2019.

Financing Partnerships

Financing partnerships enable ADB’s development partners, governments or their agencies, multilateral financing institutions, and commercial organizations to participate in financing ADB projects. The additional funds are provided in the form of loans and grants, technical assistance, and other nonsovereign cofinancing such as B loans, risk transfer arrangements, parallel loans and equity, guarantee cofinancing, and cofinancing for transactions under ADB’s Trade Finance Program and Supply Chain Finance Program.

ADB began cofinancing operations in the PRC in 1987. Since then, sovereign cofinancing commitments for the PRC have amounted to $2.35 billion for 34 investment projects and $64.76 million for 115 technical assistance projects. Nonsovereign cofinancing for the PRC has amounted to $2.5 billion for 24 investment projects and $4.42 million for three technical assistance projects.

In 2019, the PRC received a total of $198.22 million in loan cofinancing from Agence Française de Développement (AFD) and KfW for the Shandong Green Development Fund.

Projects Cofinanced, 1 January 2014–31 December 2018

Operational Challenges

ADB has gradually moved from a national infrastructure-based support model to a fully fledged partnership built on knowledge that can help local governments improve the quality of economic development in the PRC’s remote areas. This change aims to foster better urban–rural integration, tackle climate change, protect the environment, promote regional cooperation and integration, and stimulate inclusive growth.

New ADB-supported projects are promoting innovation and integration in technical design and knowledge solutions, engaging more implementation agencies at the lower levels of government, and encouraging coordination across sectors and provinces. As the projects become more complex and are implemented by local governments in less-developed regions, capacity-building activities need to be intensified.

Future Directions

As part of its new country partnership strategy for the PRC, covering 2021–2025 and aligning with the country’s 14th Five-Year Plan, ADB will address the challenge of transitioning to high-quality green development in the PRC. Consistent with ADB’s approach to upper middle-income countries, climate change mitigation and adaptation, environmentally sustainable development, addressing emerging issues such as aging and health security, and strengthening institutions will be key planks of ADB’s future operations in the PRC. The bank will provide support in developing demonstrative projects and policy innovations, introducing new approaches and advanced technologies, promoting reforms and capacity building, expanding private sector operations (including public–private partnerships), generating regional public goods, and promoting knowledge sharing. ADB can also help to replicate and scale up innovative solutions, not only within the PRC but also in other developing member countries.

A human-centered design approach is helping deliver an intelligent transport system in the city of Gui’an, People’s Republic of China (PRC)

This article was originally published in the ADB and the People's Republic of China: Fact Sheet. Updated yearly, this ADB Fact Sheet provides concise information on ADB's operations in the country and contact information.

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