JEJU, South Korea, 14 May 2004 — The Asian Development Bank announced yesterday it was setting up a seven billion-dollar fund to help fight poverty, with China making a contribution for the first time to reflect its status as a rising economic power.
ADB officials said the amount committed to the Asian Development Fund, which will run between 2005 and 2008, was “significantly higher” than the $5.65 billion committed for the 2001-2004 period.
ADB President Tadao Chino said Japan, the United States, Australia, Britain and wealthy Asian countries were the main contributors to the fund, which is lent to finance projects in the bank’s poorest members at low interest rates and a 32-year repayment period.
The fund, which is replenished every four years and is a core component of the bank’s strategy to fight poverty in the region, would enable the ADB to “vigorously pursue its mission of fighting poverty in the Asia-Pacific region,” Chino said. “I am truly gratified by this very strong show of support from ADB’s donors. It clearly demonstrates the commitment of shareholders to our institution,” he told reporters ahead of the bank’s annual meeting here that begins tomorrow.
For the first time, the fund will earmark 21 percent of the amount to be given as grants to countries emerging from conflicts such as Afghanistan and East Timor, as well as in fighting HIV AIDS and other communicable diseases, which have recently struck the region. Reducing poverty in Asia will be a headline agenda during the two and half-day meeting in this South Korean island which will gather the finance ministers and central bank governors of the ADB’s 63 members. In an interview with AFP earlier this week, Chino said there had been “remarkable progress” in cutting poverty between 1990 and 2000. In 2000, the proportion of people living on less than one US dollar a day was 22 percent, down from 32 percent in 1990. This means the number of poor people fell from 900 million to 720 million in the same period.
However, the income gap between the rich and the poor countries as well as the divide between the impoverished and the wealthy within member countries remained. Two-thirds of the world’s poor are still found in the region. Meanwhile, China’s contribution of $30 million to the fund marked the first time that Beijing has become a donor, Chino said. Malaysia also resumed contributions after it was suspended following the 1997-1998 Asian financial crisis.
