YOKOHAMA—Finance Secretary Carlos Dominguez III said the Asian Development Bank (ADB) should take on an “effective role” in promoting inclusive growth and reducing inequalities in the region against the backdrop of “rising protectionism,” an “increased inclination for autarky,” and a possible outbreak of “old hostilities” as well as calamities triggered by climate change.
Dominguez, who is the incoming chairperson of the ADB’s Board of Governors, said the Bank’s 50th year is a fitting time to review the work it has done and “rethink” its future role in light of the Asia-Pacific’s ascent as a global driver of economic growth.
“Over the last fifty years, the ADB mobilized $250 billion to help fight poverty in the region. That is an impressive number, taken at the aggregate. It is dismal when set against the current size of the regional economy, the population our development efforts need to assist and the pace at which individual member-economies need to grow,” Dominguez said here before the business session of the ADB Board of Governors at the Pacifico Yokohama Conference Center.
Dominguez added: “In a word, our world has grown. It has also changed. The member-economies have new needs. The Bank must rethink its own programs to continue being relevant.”
While recognizing ADB’s valuable contributions to the Philippines, being one of its biggest sources of official development assistance (ODA), Dominguez said there is still “much room for improvement” in tailoring the assistance the Bank provides through “well-coordinated and innovative” financing strategies to fit the country’s ODA needs, particularly in helping fund its planned massive investments in infrastructure and human capital formation .
“On the occasion of this 50th Annual Meeting, allow me to both express sincere appreciation for the Bank’s staunch support as well as challenge the institution to be stronger, better and more responsive,” Dominguez said.
“The increase in the magnitude of the Bank’s capacity to support regional development will, I hope, not diminish its agility and its flexibility. We find ourselves in a world very different from the conditions obtaining 50 years ago,” Dominguez said.
These social tensions, according to Dominguez, take the form of “rising protectionism, a growing distrust for trade and an increased inclination for autarky,” which are aggravated by threats of a possible outbreak of “old hostilities” and massive calamities triggered by climate change.
“We understand that the social tensions underlying the reaction derive from highly uneven growth in many of the economies in the region. While managing geopolitical tensions is beyond the Bank’s mandate, this institution should play an effective role in fostering inclusive growth and reducing disparities,” Dominguez said.
Dominguez also called on the ADB to “redefine its niche in the new universe of multilateral development banks” and collaborate closely with these institutions to “optimize capacities and make our responses to both challenges and opportunities more timely.”
In earlier accepting his designation as chairperson of the ADB’s governing board, Dominguez expressed confidence that the Board of Governors has both the “depth and talent” and “wealth of experience” to lead the “reinvention and reinvigoration” of the Bank.
In a separate statement at an ADB seminar organized by the host country Japan, he also cited the successful efforts by Asia-Pacific economies over the past two decades to improve corporate governance and develop regional mechanisms to ensure financial stability and avoid a repeat of the economic crisis that buffeted the region in 1997.
