Asian Development Bank

Asian Development Bank (ADB), multilateral financial institution based in Manila, the Philippines, which provides loans and technical assistance for development projects in Asia and the Pacific region with the aim of reducing poverty in these areas. In particular, the organization focuses on social development, economic growth, and good governance. Other issues include the promotion of gender equality, the protection of the environment, regional cooperation, and, increasingly, private sector involvement in developing countries. Development strategies are researched at the Asian Development Bank Institute in Tokyo, which was established in 1997 by the ADB and the Japanese government. (See Aid and Aid Programmes.)

The creation of the ADB was first proposed at the First Ministerial Conference on Asian Economic Cooperation in 1963. Following a resolution drawn up in 1965 by the United Nations Economic and Social Commission for Asia and the Pacific, the bank opened in December 1966, and made its first loans two years later. When it was first established, the organization had 31 country members; by 2004 membership had grown to 63 (45 in the Asian and Pacific region, 18 in other parts of the world). Loans may be allocated on non-concessionary terms from the ADB’s Ordinary Capital Resources to moderately developed countries, or on concessionary terms in the case of under-developed member nations. In the latter case, loans have low interest rates, and funds are drawn from the Asian Development Fund, which is financed exclusively by shareholding country members. As of December 2001 the major regional shareholders included Japan, China, India, Australia, Indonesia, and South Korea, while the largest non-regional shareholding members were the United States, Canada, and Germany.

ADB projects have occasionally attracted criticism: aspects of the 1992 Greater Mekong Subregion Initiative, which would involve the development of large-scale hydroelectric power on the Mekong River, have been criticized by organizations such as Oxfam, amid concerns about the potential effects of the project on the region’s communities. In 2002 the ADB pledged US$500 million in grants and loans, to be delivered over a 30-month period, to aid the rebuilding of war-torn Afghanistan. The financial assistance is intended to help with the reconstruction of the country’s transport, energy, and financial infrastructures. Projects begun in 2003 included the allocation of funds to Nepal, the Philippines, Bhutan, and Bangladesh.