THE Philippine government’s first-ever contribution to a grant facility of the Asian Development Bank (ADB) will not only bolster the economic growth of the country but also that of the Asia-Pacific region, the finance chief believes.
In a statement on Sunday, Finance Secretary Carlos G. Dominguez III said the growth of least developed countries (LDCs) will provide the Philippines and the rest of the region with new potential markets to further boost domestic and regional economic expansion.
Dominguez added the Philippines’ contribution to Asian Development Fund (ADF) is set to be announced during a pledging session to be held on the sidelines of the ADB’s 53rd Annual Meeting in Incheon, Korea in May this year.
The ADF “provides grants to ADB’s lower-income developing member countries,” the ADB website said. “Established in 1974, the ADF initially provided loans on concessional terms. Activities supported by the ADF promote poverty reduction and improvements in the quality of life in the poorer countries of the Asia and Pacific region.”
Since the Philippines graduated from ADF assistance in 1999, we have yet to contribute to the replenishment of that fund, Dominguez was quoted in the statement as saying.
“Now, as we move to the upper middle-income status, the country is poised to extend help to the LDCs including some of our neighbors in the Asean [Association of Southeast Asian Nations] and the Pacific,” he added.
The pledging session for ADF 13 scheduled on May 2 will be the 12th time that the ADF will be replenished since it was established in 1974.
“With the proposed Philippine contribution to ADF 13, the country is expected to benefit in terms of further driving its growth from the possible development of new markets within the region,” Dominguez said.
Manila’s contribution to the ADF also conveys goodwill to the region’s LDCs, whose economic and social development will also have an external benefit to the Philippines in terms of strengthening regional health security by preventing the transmission or outbreaks of such as HIV-AIDS, malaria, tuberculosis, and other major illnesses, the finance chief said. Dominguez stressed this move also comes at a crucial time when assistance from the Manila-based multilateral lender’s European partners may possibly be reduced.
In his first courtesy call recently at the Department of Finance (DOF) office in Manila, ADB President Masatsugu Asakawa thanked President Duterte for Manila’s planned contribution to the ADF.
The ADB’s ADF grant facility aims to promote poverty reduction and improvements in the quality of life of people in LDCs of the Asia-Pacific region. It is specifically dedicated to support ADB’s poorest and most vulnerable developing member-countries, such as Afghanistan, Cambodia, Kiriba, Kyrghyz Republic, Maldives, Marshall Islands, Federated States of Micronesia, Nauru, Nepal, Samoa, Solomon Islands, Tajikistan, Tonga, Tuvalu and Vanuatu. The ADF’s total replenishments has reached $4.01 billion, inclusive of $2.59 billion in donors’ contributions, according to the DOF.
Some Asean countries that had graduated from ADF assistance like Thailand and Indonesia are now donors to the ADF.
The ADF is currently being supported by non-regional donors, such as selected European countries, the United States, Canada and Turkey, and regional donors (Australia, China, India, Japan, Kazakhstan, South Korea, New Zealand, Taipei, and selected Asean countries).
Asakawa also reiterated during his meetings with Duterte and Dominguez that ADB is in full support for the Philippine government’s “Build, Build, Build” infrastructure modernization program.
The ADB President also congratulated the government for its remarkable success in bringing down the national poverty rate to 16.6 percent in 2018 from 23.3 percent in 2015. He also vowed that the ADB will continue supporting Philippines’ efforts to reduce poverty and create high-quality jobs for Filipinos.
The Philippines has been supportive of various initiatives of other institutions such as the World Bank (WB), International Monetary Fund (IMF) and the United Nations (UN) to assist LDCs.
It is a continuous donor to the WB’s International Development Association and the UN’s International Fund for Agricultural Development.
The Philippines, through the Bangko Sentral ng Pilipinas, extended until end of this year a $1-billion loan facility to the IMF through a bilateral borrowing agreement, which was first signed in 2013, to support countries going through financial difficulties.
This loan will help strengthen the global financial safety net and contributes to the IMF’s overall lending capacity of about $1 trillion for an additional year.