The global economic crisis will remain Asia-Pacific's most daunting development challenge in the next couple of years, and the Asian Development Bank stands ready to take on the task.
The regional development bank is now well-equipped to respond to the region's enormous financial demands arising from the crisis after its Board of Governors approved to hike its capital threefold from $55 billion to $165 billion.
The majority of ADB's 67 member countries voted to increase the capital base by 200 percent, the largest in the bank's history and the first since 1994.
ADB President Haruhiko Kuroda said it was a historic moment for the bank and the region.
"[This] is a resounding vote of confidence in this region's ability to overcome obstacles on the path to economic growth and poverty reduction," he said at the opening of the 42nd annual meeting in Bali on May 4.
Kuroda said 2009 and 2010 will be the "most difficult years," which justified the urgency by which the bank has called on its shareholders to approve the general capital increase.
In short, a lot of money will be rolled out this year and next as the bank intensifies efforts to mitigate the adverse impacts of the crisis, especially on poverty reduction. ADB made available $22 billion for developing countries in 2007 to 2008. That amount will go up by $10 billion so that in 2009 to 2010, ADB will have a $32 billion budget.
Kuroda said of the $10 billion increase, up to $1 billion will be devoted to trade finance to generate $15 billion in trade assistance by 2013.
Another $3 billion will be earmarked for a $3 billion countercyclical support facility. The fund, once approved by the board, will provide faster and cheaper short-term loans than the bank's existing special program loan facilities.
"I believe this will be a very welcome initiative to assist faltering economies and, most importantly, protect the poor from the worst impacts of the crisis," Kuroda told journalists during a press conference on May 2.
The balance of $6 billion will be allocated to program loans, infrastructure investment loans and some grant assistance, Kuroda said.
Such huge sum of money comes with strings attached: liability. Kuroda assured that ADB intends to be an effective – and responsible – development partner in Asia.
"ADB is well positioned to play an expanded role in the region's future development," said Kuroda. "And we are committed to being fully accountable for the results of our efforts."