Leading the Response and Recovery of Asia and the Pacific through Decisive Action, Country Presence, and Financial Strength - Masatsugu Asakawa
Speech | 22 May 2020
Remarks by Masatsugu Asakawa, President, Asian Development Bank at the 53rd ADB Annual Meeting of the Board of Governors Business Session, 22 May 2020
Members of the Board of Governors and Alternate Governors, it is a great pleasure to address you as President of the Asian Development Bank for the first time since I took office on January 17 this year.
We are meeting today by video link due to the unprecedented circumstances created by the coronavirus disease (COVID-19) pandemic. I offer my deepest condolences and solidarity to all who have been affected.
I would like to acknowledge the Chair of the Board of Governors, Deputy Prime Minister and Minister of Economy and Finance of the Republic of Korea, Mr. Hong Nam-Ki, who has shown constant support and flexibility as we adjusted our Annual Meeting plans. Deputy Prime Minister, I am deeply grateful to you and staff of your government.
II. ADB’s response in the fight against COVID-19
Let me update you on what ADB has been doing to serve our developing members during these difficult times, and how we can lead the global effort to tackle the challenges facing the region through our decisive action and strong country presence.
Our immediate priority is to provide vital support to our developing member countries as they confront the COVID‐19 pandemic and return their economies to a path of sustainable growth. ADB has been providing support for COVID-19 response since early February, to meet urgent needs for medical supplies and to provide working capital to businesses to help sustain supply chains and trade. These immediate responses were followed by our rapid mobilization of budget support.
From the early stages of the pandemic, I have kept direct lines of communication open with our Governors and with heads of state—to ensure that we respond to our members’ needs thoughtfully, quickly, and effectively.
We prepared an initial assistance package of $6.5 billion on March 18. We tripled this on April 13 to $20 billion, providing a comprehensive response that includes emergency countercyclical fiscal support under the COVID-19 Pandemic Response Option, or CPRO. As of today, seven countries have received over $5 billion under the CPRO. We have also provided $79 million in grants and technical assistance to 40 of our developing member countries, and $475 million in financing to the private sector.
Let me stress that we are making every effort to strike a balance between the needs of our developing members and ADB's long-term financial sustainability—because we must respond meaningfully to the COVID-19 crisis while retaining our capacity to help them recover strongly and achieve the Sustainable Development Goals.
We also have worked intensively with our partners to bring together cofinancing and additional funding for ADB’s pandemic response. As of today, we expect cofinancing to reach at least $5.8 billion. Our coordination with development partners has been extensive—from the country level with the International Monetary Fund and multilateral development bank (MDB) teams; to my own exchanges and meetings with the MDB heads; and through our work with UN agencies including the World Health Organization and UNICEF.
Building on ADB’s extensive knowledge work, we are delivering up-to-date assessments about the pandemic’s economic impact and providing policy advice and other resources to tackle many pressing development challenges. Let me stress that we are already studying carefully what the world will be like after the COVID-19 crisis, so that ADB can effectively help developing member countries re-open their economies and rebuild smartly—by combining our finance, knowledge, and initiatives for regional cooperation and integration.
Ladies and gentlemen, I knew when I took this job in January that it is a big task to lead ADB. The COVID-19 pandemic has not made it any easier. But thanks to the strong support from the Board, and great work by ADB staff, I am really proud of how we have responded.
III. ADB’s operational highlights in 2019
Let me now turn to some key highlights from our operations in the year 2019, which works as a solid foundation for ADB to respond quickly and effectively to the ongoing crisis.
The demand for ADB assistance remained strong last year. We committed $21.6 billion in loans and grants to support our developing member countries. Our nonsovereign operations reached $3 billion for the second year in a row, reflecting our plan to expand ADB’s private sector investments into new sectors and frontier markets.
Our operations strongly supported the thematic areas of Strategy 2030. In 2019, we committed $6.56 billion in climate financing from our own resources—which sets a strong foundation for achieving our target of $80 billion in cumulative climate financing from 2019 to 2030. We are also on track to achieve our target of promoting gender equality in at least 75% of ADB’s sovereign and nonsovereign operations.
The robust volume and high development impact of our 2019 operations—together with careful risk management, appropriate fundraising, and solid internal administrative budget control—resulted in nearly $1.1 billion in allocable net income, which is our highest on record.
As you approved during this session, about $259 million out of the $1.1 billion net income will be transferred to the Asian Development Fund, or ADF. This will enable ADB in this last year of the ADF 12 replenishment cycle to help the poor and most vulnerable countries combat COVID-19 and ensure a strong economic recovery.
I would also like to highlight the upcoming replenishment of grant resources for ADF operations covering 2021 to 2024. The next phase of ADF—ADF 13—will be the first to implement ADB’s Strategy 2030 during its full cycle. We appreciate your strong support this year to ensure a successful ADF 13 replenishment, to be concluded in September.
Let me end my remarks by thanking you once again for the unwavering support you have given to ADB and its developing members. Your approval today of the financial statements and allocation of net income ensures that we have the tools and financial stability to address the enormous challenges that now affect the lives and economies of millions of people across our region.
I very much look forward to meeting you, face to face, in Incheon in September—when, we hope, conditions will allow for our hosts and participants to take up the full Annual Meeting agenda safely and productively. Let us continue our discussions then as we work together to overcome this pandemic and achieve a prosperous, inclusive, resilient, and sustainable Asia and the Pacific.