Transport is an integral part of most of the activities, goods and services required for supporting and improving people’s lives. ADB assists member countries in developing Asia inbuilding transport infrastructure and services that contribute towards low-carbon, safe, accessible, and affordable transport systems.
Transport has been one of ADB’s main sectors over the last four decades with transport operations now nearly 32% of total ADB lending. Since 1966, ADB has financed $35.6 billion in transport investments. For 2011–2013, the expected annual lending pipeline for transport is $3.4 billion.
Sustainable transport initiative
ADB approved in 2010 the Sustainable Transport Initiative-Operational Plan (STI-OP), that guides ADB investments in low-carbon, safe, accessible, and affordable transport systems and inclusive, clean, and energy-efficient transport policies and projects.
STI aligns ADB transport operations with Strategy 2020 which features three guiding agendas: inclusive economic growth, environmentally sustainable growth, and regional integration. At the request of DMCs, ADB has progressively shifted the focus of its transport sector portfolio to expand lending for urban transport and railway projects. Past ADB support for railways has been mainly confined to Bangladesh, the People's Republic of China, India, and Uzbekistan with new lending under consideration for Cambodia, Mongolia, and Turkmenistan.
ADB’s STI operational plan identifies four key areas for new and enhanced lending to scale up support for sustainable infrastructure. These include investments in urban transport, support for low-carbon and climate resilient transport, integration of safety in road investments, and cross-border transport and logistics.
As Asia’s urban population swells by 44 million a year, ADB estimates that 80% of new economic growth will be generated in urban areas. In response, ADB is rapidly scaling up its urban transport operations with urban transport now 18% of ADB’s transport lending for 2010-2012. More
Road safety and social sustainability
Out of an estimated 1.18 million deaths and millions of injuries globally each year due to road accidents, 60% occur in Asia. To have a more sustainable impact on road safety in DMCs, ADB will increase the scale, quality, duration, and continuity of its support for road safety. Since ADB’s overarching goal is poverty reduction, its work on transport should contribute to providing effective solutions to the transport needs of the poor. More
Addressing climate change
Emissions from transport are the fastest growing source of CO2 emissions, with the vast majority of projected increases expected to come from developing Asia. Asia accounted for 19% of the world’s total transport sector CO2 emissions in 2006 and by 2030, this figure will balloon to 31%. Many of the region’s cities suffer from the highest air pollution levels in the world, with transport contributing a large part. ADB’s actions to mitigate climate change from transport is guided by the “avoid-shift-improve” approach--integrating land use developments with mobility needs to avoid the need for travel; providing a shift to energy-efficient modes of transport; and seeking to improve vehicle and fuel technologies. At the same time ADB is also mainstreaming climate adaptation measures into its transport operations. More
Regional cooperation and integration
Intraregional trade now accounts for 55% of the region’s total trade. As tariff barriers have diminished, transport costs and bottlenecks have emerged as constraints to trade growth. A recent Asian Development Bank Institute (ADBI) study estimates that improved transport and harmonization of regulations to facilitate new trade and transport patterns would generate $13 trillion in increased income for Asia over the next 10 years. ADB support for transport and trade facilitation has led to significant savings in vehicle operating costs and travel time, and reduced border-crossing times. More
Mainstreaming sustainable transport in existing operations
ADB will continue operations where it already has a track record of effective operations. This includes construction and rehabilitation of roads, including rural roads, as well as development of railway systems which will constitute the majority of ADB transport operations during the initial years of the STI operational plan and will still account for a substantial portion in 2020. For such operations, the STI will focus on mainstreaming sustainable transport considerations into ADB’s approach.
While the share of road projects is going down, the share of railway projects is increasing.
Financing and the private sector
Transport improvements have not kept pace with the growth in demand and transport remains a critical development bottleneck, according to ADBI. In the next decade, the countries of Asia and the Pacific will need to invest $2.5 trillion for transport alone. In the past decade, ADB assisted some DMCs with policy, legal, regulatory and institutional arrangements to support increased private sector participation in transport. Through its public sector operations it helped governments introduce additional forms of private participation, such as build-operate-transfer (BOT) concessions for toll roads and bridges, public transport service concessions, and performance and area based operation and maintenance contracts. Overall, ADB's direct private sector lending for transport has been very modest. This reflects a series of problems and challenges, some concerning the wider environment for transport PPPs in DMCs, and others concerning limitations in ADB's approach to supporting transport PPPs.