Asian Development Bank October 2015 President Takehiko Nakao
Azerbaijan ADB Regional Members(48 economies) Uzbekistan Kazakhstan Georgia Armenia Turkmenistan Afghanistan Pakistan Kyrgyz Republic Mongolia Tajikistan Republic of Korea = Advanced economies and People s Republic of China graduated Nepal Bhutan Japan developing member countries Lao PDR Hong Kong, China India Myanmar Taipei,China Thailand Marshall Islands Bangladesh Viet Nam Philippines Cambodia Micronesia Kiribati Sri Lanka Brunei Palau Nauru Maldives Malaysia Tuvalu Papua New Guinea Singapore Solomon Islands Samoa Non-Regional Members(19 countries) Austria, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Ireland, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States Indonesia 2 Timor-Leste Australia Vanuatu New Zealand Cook Islands Fiji Tonga
Country Data(2014) Population (million) GDP ($ billion) Per capita GDP ($) People s Rep. of China 1,367.5 10,355 7,572 India 1,259.7 2,048 1,626 Indonesia 251.5 856 3,404 Pakistan 186.3 233 1,275 Bangladesh 158.2 187 1,179 Philippines 99.4 290 2,913 Viet Nam 90.6 188 2,073 Thailand 68.6 380 5,550 Myanmar 51.4 65 1,270 Republic of Korea 50.4 1,449 28,739 (reference: advanced economies) Japan 127.1 4,770 37,540 United States 318.5 17,416 54,678 Germany 80.9 3,820 47,201 France 64.0 2,902 45,384 United Kingdom 64.5 2,848 44,141 Note: 2014 data are estimates. Pakistan s GDP and per capita GDP data are for 2013. Source: World Economic Outlook October 2014 database. 3
Growth Rate (%) 2014 2015 (Forecast) 2016 (Forecast) Developing Asia 6.2 5.8 6.0 People s Rep. of China 7.3 6.8 6.7 India 7.3 7.4 7.8 Indonesia 5.0 4.9 5.4 Pakistan 4.1 4.2 4.5 Bangladesh 6.1 6.5 6.7 Philippines 6.1 6.0 6.3 Viet Nam 6.0 6.5 6.6 Thailand 0.9 2.7 3.8 Myanmar 7.7 8.3 8.2 Republic of Korea 3.3 2.7 3.4 Source: Asian Development Outlook 2015 Update (September 2015) 4
Headquarters Manila, Philippines Founded in 1966 67 Members Asian Development Bank (ADB) Authorized Capital $ 153.1 billion* (end 2014) Major shareholders (capital share %): Japan (15.7%), United States (15.6%), PRC(6.5%), India(6.4%) * Paid-in capital (including $1.6bn committed but not paid yet): $7.7bn Callable capital: $145.4bn Annual Loan/Investment Approval $13.1 billion (2014) Loan Outstanding $83.4 billion (end 2014) Top recipients: India, PRC, Pakistan, Viet Nam, Philippines Staff 2,990 (including international staff 1,074) 5 (Dec. 2014)
Contribution by Members Ordinary Capital Resources (Capital Share/ Voting Power Share) Japan (15.7%/ 12.8%), United States (15.6%/ 12.7%), PRC (6.5%/ 5.5%), India (6.4%/ 5.4%), Australia (5.8%/ 4.9%), Canada (5.3%/ 4.5%), Indonesia (5.1%/ 4.4%), Korea (5.1%/ 4.3%), Germany (4.3%/ 3.8%), others (30.2%/ 41.6%) Asian Development Fund (Cumulative Contribution) Japan (37.9%), United States (14.2%), Australia (7.6%), Canada (6.1%), Germany (5.9%), United Kingdom (5.0%), France (4.3%), others (19.0%) International Staff (Head Count: 1,074) (December 2014) Japan (151), United States (146), India (79), Australia (65), PRC (62), Korea (50), Canada (46), United Kingdom (43), Philippines (42), Germany (41), Indonesia (33), Pakistan (32), France (29), others (255) 6
ADB Operations ADB provides loans, grants and technical assistance to developing member countries in Asia and the Pacific. Loans are financed from ordinary capital resources (OCR) and Asian Development Fund (ADF). OCR loans are provided to middle-income countries (per capita income $7,185) at quasi market rate. ADF loans are provided to low income countries (per capita income $1,215) at concessional terms (long maturities, low interest rate including grants) Grants are offered to countries with limited debt repayment capacity e.g. Afghanistan, Cambodia, Lao PDR Technical assistance includes capacity building, project preparation, and research for developing members. 2014 Approvals 2014 Outstanding Equity OCR $10.44 billion $ 55.9 billion $ 16.9 billion* ADF $ 2.69 billion $ 27.5 billion $ 31.5 billion Grants $ 0.41 billion Technical Assistance $ 0.16 billion *As of 31 December 2014. Including Paid-in capital ($6.1bn) and ordinary reserves (accumulated retained earnings: $10.8bn) 7
ADB Operations Ordinary Capital Resources (OCR) Operations Approvals ($ million) 14,000 [USD million] 12,000 10,000 10,438 8,000 6,000 4,000 2,000 By country (2014) Others 30.3%(28.3%) 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 India 27.9%(23.6%) By sector(2014) Industry & Trade 3.4% (0.3%) Other Infrastructure 4.4% (0.2%) Agriculture 3.3% (3.7%) Information & Communication Technology 0.5% (-) Health 0.002% (0.6%) Viet Nam 7.1%(4.0%) Pakistan 7.9%(10.3%) PRC 17.4%(19.6%) Philippines 9.3%(8.4%) Education 4.8% (4.1%) Water 9.6% (10.9%) Finance Sector Development 10.0% (11.1%) Transportation 34.3% (32.6%) Note: Bracketed numbers are from 2013. 8 Public Sector Management 12.5% (7.2%) Energy 17.1% (29.4%)
USD million Asian Development Fund(ADF) Operations Approvals ($ million) 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 By country (2014) Others 34.8%(40.1%) Cambodia 7.3%(1.8%) Nepal 10.5%(9.8%) Note: Bracketed numbers are from 2013. Pakistan 18.2%(11.9%) Bangladesh 16.0%(9.4%) Viet Nam 13.2%(9.5%) By sector (2014) Water 8.0% (14.1%) 9 Finance Sector Development Public Sector 3.2% (4.0%) Management 6.5% (27.0%) Education 10.1% (5.6%) Agriculture 13.0% (8.6%) Other Infrastructure 2.3% (1.2%) Industry & Trade 1.4% (0.5%) Health 0.0% (2.5%) 3,091 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Energy 29.6% (19.4%) Transportation 25.8% (17.0%)
Asian Century Scenario (global GDP composition) <Source: Asia 2050, which is a study in 2011 commissioned by ADB> Present(2013) Asian Century Scenario(2050) Asia s GDP: $22 trillion (market FX rate) Asia s per capita GDP: $10,078 (PPP) Asia s GDP: $174 trillion (market FX rate) Asia s per capita GDP: $40,800 (PPP) Population (billion) and Share (%) 2013 2050 Asia 3.97 (56%) 4.76 (52%) World 7.15 (100%) 9.15 (100%) 10
Asian Share of World GDP 70% 60% 50% 40% 30% 20% 10% 0% 1700 1820 1870 1913 1950 1970 1980 1995 2010 2020 2030 2040 2050 Source: Asia 2050: Realizing the Asian Century 11
Poverty in ADB Developing Member Countries $1.25 per day $2.00 per day Year Population (million) Number of Poor (million) Poverty Incidence Share of World Poor Number of Poor (million) Poverty Incidence Share of World Poor 1999 2005 2011 3,104 (51%)* 3,337 (51%)* 3,547 (51%)* 1,236 39.8% 70.3% 2,129 68.6% 72.3% 886 26.5% 64.5% 1,786 53.5% 69.3% 544 15.3% 53.8% 1,398 39.4% 64.7% * Ratio to the world population (6,051 million in 1999; 6,514 million in 2005; 6,998 in 2011) 12
Eight Conditions for Economic Development - Op-ed by President Nakao, Nikkei Asian Review (Feb 5, 2015) - 1. Infrastructure investment 2. Investment in health and education 3. Macroeconomic stability 4. Open trade and investment regimes: including streamlining regulatory framework and reforming sate-owned enterprises 5. Public governance: anti-corruption, efficiency of delivering services and quality of regulations 6. Social inclusiveness: sharing development fruits 7. Vision for the future 8. Political stability, security, and good relations with neighboring countries 13
ADB s Long-Term Strategic Framework: Strategy 2020 (formulated in 2008) Vision: An Asia and Pacific Free of Poverty Strategic Agendas 1) Inclusive Economic Growth 2) Environmentally Sustainable Growth 3) Regional Integration Core Areas of Operations 1) Infrastructure 2) Environment 3) Regional Cooperation and Integration 4) Finance Sector Development 5) Education The Three I s - Innovation - Inclusiveness - Integration (President Nakao s speech, ADB Annual Meeting in May 2013) 14
Midterm Review of Strategy 2020 -Meeting the Challenges of a Transforming Asia and the Pacific- (approved by the Board on 23 April, 2014) ADB s Strategic Priorities for 2014-2020 1. Poverty Reduction and Inclusive Economic Growth 2. Environment and Climate Change 3. Regional Cooperation and Integration 4. Infrastructure Development 5. Middle-Income Countries 6. Private Sector Development and Operations 7. Knowledge Solutions 8. Financial Resources and Partnerships 9. Delivering Value for Money in ADB 10. Organizing to Meet New Challenges 15
Reforming ADB Enhancing lending capacity up to $20 billion or by up to 50% over the current level, by combining Asian Development Fund (ADF) s equity and lending operations to the Ordinary Capital Resources (OCR) balance sheet. Streamlining procurement More authorities delegated to Resident Missions. The office of Public-Private Partnership established. 7 Sector Groups (Transport, Energy, Health, Education etc.) and 8 Thematic Groups (Gender, Governance, Environment etc.) reconstituted with full time secretariats. Talent management and workforce planning Private sector operations strengthened through more rational interpretation of equity headroom, introduction of a facility for small non-sovereign transactions, and etc. 16
ADB TO DOUBLE ANNUAL CLIMATE FINANCING TO $6 BILLION FOR ASIA-PACIFIC BY 2020 (announced on 25 September 2015) Doubling ADB s annual climate financing to $6 billion by 2020, from the current $3 billion. $4 billion for mitigation through scaling up support for renewable energy, energy efficiency, sustainable transport, and building smart cities. $2 billion for adaptation through more resilient infrastructure, climate-smart agriculture, and better preparation for climaterelated disasters. Continuing to explore cofinancing with Green Climate Fund and other partners. Mobilizing greater private resources. Issuing more green bonds. Strengthen partnerships with centers of excellence to provide cutting-edge knowledge and expertise