Opening statement by Masatsugu Asakawa, President, Asian Development Bank, at the President's Press Conference at the 55th Annual Meeting, 27 September 2022
Good afternoon. Thank you for joining this press conference, where I want to update you on the Asian Development Bank’s work to support Asia and the Pacific.
We are meeting this week in Manila for ADB’s 55th Annual Meeting. This is our first partially in-person annual meeting since 2019.
More than 45 of our Governors and Alternate Governors are joining us here at ADB headquarters and others will be joining virtually. I am pleased that the President of Sri Lanka and Chair of the Board of Governors of ADB has joined us as head of his country’s delegation. The President of the Philippines, President Marcos, will also meet our Governors later this week.
We have over 4,000 onsite and virtual participants registered at this Annual Meeting.
At these meetings we are discussing our region’s path to recovery and the new uncertainties facing our developing member countries. These headwinds include food security, inflation, and debt crises.
All these challenges need to be understood in light of the ongoing threat of climate change.
I. Current development context
Let me offer a few reflections on the current situation facing our region.
The social and economic conditions have been challenging. The pandemic was difficult and continues to impact many aspects of life.
In 2020, Developing Asia and Pacific saw its first contraction of economic growth in nearly six decades. We now see economies in recovery, but the outlook has started to worsen. This is due to growing challenges such as the impact of the Russian invasion of Ukraine, stronger-than-expected monetary tightening in advanced economies, and the sharp exchange rate depreciation and financial instability that may result.
We have revised down our growth forecasts for 2022 from our projections in April from 5.2% to 4.3%, and from 5.3% to 4.9% for 2023.
As I mentioned, ADB is working to support our developing member countries through these challenging conditions. Let me highlight two crucial areas where we are focusing our support.
II. Addressing climate change
The first is climate change. This remains a crucial issue for the region.
Asia and the Pacific is responsible for 50 percent of global greenhouse gas emissions. And more than 80 percent of the projected growth in coal demand will be from Asia.
The climate impacts on the region are distressing. Asia and the Pacific is experiencing climate shocks and stresses. There have been devastating floods, droughts, cyclones, and heat waves. We see its effect on livelihoods, food and water security, and the health of millions of people.
We know that the battle against climate change will be won or lost in Asia and the Pacific. And the region must act urgently to decarbonize energy systems and other sectors and to invest in climate adaptation.
In response, ADB is fully committed to its role as the Climate Bank for Asia and the Pacific. We have raised our climate financing ambition to $100 billion between 2019 and 2030. We have withdrawn from financing new coal-fired power plants. We introduced our Energy Transition Mechanism (ETM) to accelerate the retirement of existing coal power plants, and to promote a shift to clean energy while ensuring a just transition. We are also scaling up support for climate adaptation.
III. Food security
Let me turn now to another pressing issue for our region: food security.
My friends, food insecurity is threatening to reverse decades of development progress in Asia and the Pacific. Many factors are contributing to the worsening situation. For example, supply chain issues from the pandemic and the Russian invasion of Ukraine have contributed to food prices that have soared to record highs this year.
We also have to keep in mind that the current food security crisis will get even worse if we fail to address climate change. Floods, droughts, heat, disease, and other factors affected by climate change will have an impact on food production. Disruptions to livelihoods will drive even more food scarcity, compounded by climate-induced migration.
In light of the growing urgency surrounding food insecurity in our developing member countries, we have made this issue a top priority.
And so, today I am announcing that ADB will provide $14 billion in support from 2022 to 2025 to address food security. Our response will be comprehensive, bringing into focus both the immediate and long-term aspects of food security.
Let me add that ADB has been working with our members and development partners on these challenges. And our work will build on the considerable food security support we are already providing in areas including countercyclical budget support, agricultural development, and climate action.
Let me tell you more about our efforts.
First, our support to food security issues is integrated across our operations, both in sovereign support and support to the private sector. This year, we expect to finalize commitments totaling about $3.3 billion.
In our sovereign operations, we are repurposing funds from selected projects and strengthening countercyclical support in a number of countries for a total of approximately $1 billion. We also have at least $1.5 billion in our project pipeline related to agriculture, natural resources, and rural development.
With the private sector, we are supporting trade and supply chain finance, and we are providing financing to agribusiness and to farmers. ADB’s lending to financial institutions will also support food and agriculture small and medium enterprises. Private sector support from ADB resources is expected to reach $800 million in 2022.
Second, let me highlight our plans for 2023-2025. We understand that food security requires food systems that are resilient. Our continued support for agriculture, natural resources, and rural development will contribute to this. We have programmed up to $10.7 billion in additional commitments from 2023-2025.
ADB is adopting three strategies to build stronger, more sustainable, and equitable food systems.
- First, we are scaling up our climate mitigation and climate adaptation investments across the entire food and agriculture value chain. This includes support to strengthen participation of smallholder farmers and women in building the resilience of agricultural communities.
- Second, we are promoting digital transformation initiatives. These will improve the efficiency of agricultural production and value chains, including fisheries and livestock.
- Third, we are promoting nature-based solutions. This includes our work to develop innovative financial instruments to attract capital that will build environment-friendly food systems, and to promote more balanced diets.
Let me stop here. I look forward to answering your questions.