Beijing-based Asian Infrastructure Investment Bank (AIIB) is keen on helping its member countries bridge the digital divide through 5G technology.
In a session on Regional Connectivity during the last day of the AIIB annual meeting, AIIB Vice President for Policy and Strategy Joachim von Amsberg said the multilateral development bank is interested in investing in digital infrastructure.
Von Amsberg, who was a former World Bank Philippine Country Director, said the AIIB is keen on working with partners and explore cooperation on technology, safety and privacy standards.
“We are open to make this a core pillar whether it’s a hardware or software [investment],” Von Amsberg said. “[This is an] area we would like to invest in.” Digital regional connectivity is one of the areas needed to be addressed, particularly in a post-coronavirus 2019 (Covid-19) world, he added.
In the same session, United Nations Economic and Social Commission for Asia and the Pacific (Unescap) Executive Secretary Armida Salsiah Alisjahbana said bridging the digital divide is important even in efforts to achieve the Sustainable Development Goals (SDGs).
In order to accelerate digitalization, Alisjahbana said greater cooperation is needed in order to make 5G networks accessible to all.
This should be accompanied by efforts to ensure access to electricity; make laptops and applications affordable; and making access to the internet available for all.
Alisjahbana said governments need to boost its efforts to set up their own broadband networks to ensure that all their citizens will be able to tap into digital solutions.
“We need to have all these in place,” Alisjahbana said. “The pandemic [bared] the vulnerability [of countries such as high] inequality and poverty.”
Covid facility
The AIIB said the uncertainty and economic hardships created by the pandemic need to be reversed to ensure the current and future generations will not suffer.
In his speech at the virtual opening ceremonies of the 5th AIIB Annual Meeting last Tuesday, AIIB President Jin Liqun said such is the reason for the creation of the AIIB’s Covid-19 Crisis Recovery Facility.
Since the facility was created in April 2020, the AIIB has extended $6 billion in assistance to 12 member countries, according to Liqun. This brought up the AIIB’s total assistance to the region to $20 billion since it was founded in 2016.
“Incomes are down. Debts are up. Uncertainty remains. Unless effective measures are taken to reverse this trend, we will suffer the loss of a generation,” Liqun said. “We will not allow such a disaster to befall our people and future generations.”
Absent funding
The facility can be tapped until October 16 2021 and will offer a total of between $5 billion and $10 billion in financing to public and private sector entities in any AIIB member facing, or at risk of facing, serious adverse impacts as a result of Covid-19.
The facility can be tapped for immediate health financing needs; efforts to boost economic resilience; and support for liquidity constraints for infrastructure support that may be delayed or suspended in the absence of AIIB funding.
Liqun said the bank’s “timely creation” has opened the doors for greater international cooperation, particularly in terms of ensuring economic growth is sustainable in the region.
“The world is changing rapidly. We provide support to cushion against economic shocks. We ensure growth is inclusive and sustainable. This will require all of our efforts,” Liqun said. “We do not have all the answers, but we are committed to doing our part.”
In his opening remarks, Chinese President Xi Jinping said China remains committed to support the AIIB and make it a successful multilateral development bank.
It can be noted that Xi was the one who proposed the creation of the AIIB in 2013. It took three years to establish the AIIB, which began operating in January 2016.
Inclusive, open
Xi recommended that AIIB develop into a “new type of multilateral development bank” and provide “high-quality, low-cost and sustainable investment for both traditional and new types of infrastructure.”
He also recommended that AIIB should innovate and, as the newest multilateral development bank, the AIIB is in the best position to implement changes. Xi said the AIIB should help enhance connectivity, promote green development and further technological breakthroughs.
Xi said the AIIB must strive to always keep in mind the development needs of its members and commit to the creation of best practices in terms of international cooperation.
Last, Xi said, the AIIB should remain “open and inclusive” by providing public goods for the region, pushing for regional economic integration, and making economic globalization beneficial for all.
“China always supports and adheres to multilateralism, and pursues development with the rest of the world in the spirit of openness and mutually-beneficial cooperation,” Xi said.
“China will continue working with other members to support the AIIB and make it a success, and contribute more to the global response to risks and challenges and the pursuit of shared development,” he added.
Other projects
The AIIB has extended support for two Philippine projects: the Covid-19 Active Response and Expenditure Support (Cares) program, which is being co-financed with the Asian Development Bank (ADB), and the Metro Manila Flood Management project. The AIIB extended a $750 million loan for the project. The project is supported under the bank’s Covid-19 Crisis Recovery Facility. It aims to improve the country’s testing capacity; conditional cash transfers and emergency subsidy support; and, wage subsidies provided for at least 1 million micro, small, and medium-sized enterprises (MSMEs), among others.
For the Metro Manila Flood Management project, meanwhile, the AIIB extended a loan of $207.6 million. The project is being co-financed with the World Bank.
The project will focus on about 56 potentially critical drainage areas with an approximate land area of 11,100 hectares or over 17 percent of the total area of Metro Manila. The total population of these drainage areas is estimated at 3.5 million while the direct project beneficiaries, i.e., those adversely affected by regular flooding, are estimated at 1.7 million.
