ADB Support to Regional Cooperation and Integration

The rapid growth in much of developing Asia has reduced income poverty and moved many countries to middle-income status. To continue advancing, however, the region must tackle the increasingly complex challenges of, among others, slowing economic growth, rising inequality, runaway climate change, and weak governance.

The promotion of the regional cooperation and integration (RCI) agenda, a corporate level strategic agenda of the Asian Development Bank (ADB), is recognized as having helped in fostering economic growth and addressing development challenges. One rationale behind the RCI theme lies in the benefits that can accrue from operating in larger markets due to economies of scale. Equally important, the RCI process has the potential to promote social stability, peace, and security, which are conducive to improved governance and better economic performance. The potentially win-win characteristic of gains for the cooperating entities lies at the center of this process.

The RCI agenda has considerable potential to bring out the strengths of ADB as a development partner and contributing to country outcomes. The evaluation found that ADB has made progress in mainstreaming the RCI agenda and undertaking RCI work. Various ADB departments have contributed to the RCI agenda, even as it was not a fully integrated or well-coordinated effort. Success rates for projects labelled as RCI have been above the average for all ADB supported projects, even though RCI projects are typically more complex than non-RCI ones. Key stakeholders in ADB countries’ governments and development partners have given ADB good marks for its RCI work.

There are crucial gaps and areas for improvement that must be addressed, especially in view of the vast potential for engaging in the RCI agenda. The evaluation found that the enabling environment for the mainstreaming of the RCI agenda had important weaknesses that can be dealt with. There is good justification for broadening the RCI agenda to work on issues beyond cross-border infrastructure—especially on matters of trade and investment integration, monetary and financial integration, regional public goods, notably climate change and biodiversity—as well as for deepening the RCI agenda to address the needs of some of the countries that are currently receiving inadequate attention.

The recommendations of this thematic evaluation are to broaden the RCI agenda beyond cross-border infrastructure (while maintaining the latter); deepen it with attention to fragile, island and linchpin countries; strengthen coordination across and within subregions; bolster country ownership for RCI; and develop new RCI project models. These are intended to feed into ADB’s RCI operational plan, which is currently being prepared, and to strengthen the value and impact of RCI work going forward.