For Australia, the Asian Development Bank’s 50th annual meeting was an opportunity to push new priorities, while celebrating past success.
Concetta Fierravanti-Wells, minister for international development and the Pacific, used her appearance on May 6 to urge the bank to improve cooperation with other multilaterals and donors, facilitate greater private sector involvement in development and target new key priority areas including health, education, gender equality and infrastructure.
See more Devex coverage of the ADB 50th annual meeting:
The timing is opportune: Australia releases its federal budget on May 9. The aid program is expected to focus more on influencing multilaterals to invest in the Indo-Pacific rather than increasing direct investment in this region.
Between sessions, Fierravanti-Wells spoke to Devex about Australia’s influential role at the bank and the country’s hopes for its directions and future. This interview has been edited for length and clarity.
What role does Australia have in encouraging other donors to contribute to ADB funds?
Australia were one of the founders of the ADB and as such we have quite some influence. We are one of the largest donors and have consistently been one of the largest donors to the ADB. We are the third largest donor and as a consequence, that affords us the opportunity to encourage other donors in relation to funds that they give to the Asian Development Funds.
We’ve been a major voice, and we are an important voice, and I was very pleased to see today President Nakao in his opening statement particularly make reference to the work Australia has done, and the support Australia has given to the ADB over its 50 years.
What is your response to the ADB’s commitment to scale-up assistance in the Pacific?
We are very, very pleased about the step-up in the Pacific.
We have been highly supportive of the work the ADB has done in the development of the strategy Road to 2030 — it very much aligns with the priorities Australia has for overseas development. Therefore, we have encouraged the ADB to undertake this reform, which will mean a lot more finance available in the Indo-Pacific area.
When you start looking at the combination of official development assistance with increased involvement of banks such as the ADB and increased private sector involvement, you start seeing that this co-financing formula will work very well for the future in the Pacific and the Indo-Pacific area.
What impact do you see the ADB having through their increased Pacific focus?
When the ADB is involved in a project, it not only enables Australia to use its leverage [for influence and impact] but the ADB’s involvement also provides important leverage.
Let’s not forget there is a much greater private sector engagement in investment in the Indo-Pacific area. And of course, having the ADB — now that it has reformed its balance sheet, and the Asian Development Fund will be slowly focused on grants while it’s other resource arm is its lending arm — is effectively going to double the amount of money that is going to be available in the Indo-Pacific area. That is looking to be about $20 billion extra — that's a lot of money.
Having the ADB involved in projects encourages private sector. It allows for that crowding, and it allows for the private sector to feel more comfortable in relation to being participants in [development] projects. The support the ADB gives may not just be in the form of loans, it could be in the form of guarantees.
What are the priorities that Australia would like the ADB to focus on over the next year?
“One of the things I’m very pleased with is that we are starting to see the ADB also focus on … human development, health, education.”—
One if the ADB’s strengths has been its infrastructure spending, and in our Asia-Pacific region, infrastructure is vitally important. But that doesn’t mean that should be its only focus.
One of the things I’m very pleased with is that we are starting to see the ADB also focus on other things — human development, health, education. Those sort of priorities. Governance and policy-led loans, which obviously assist governments in governance and transparency and internal reforms in turn add to economic growth.
So it’s really good to see the ADB moving beyond its traditional parameters of infrastructure — important though that has been to providing access, railways, roads and other things — to see it now investing in these different areas. I think this is going to be important.
Australia releases its federal budget on May 9. Has any discussion of increased aid come up in your bilateral meetings?
Australia’s ODA is 90 percent Indo-Pacific focused. As a consequence, many of the countries we interact with regularly through the ADB process are grateful for the support Australia gives.
In that sense, [this meeting] afforded us the opportunity to talk about some of the things we are doing together, how certain things are progressing, and it has been a very useful interaction. Not just in terms of looking at what the bank is doing — and Australia does, of course, co-finance with the ADB in quite a range of different projects including in countries such as Tonga in terms of solar energy. The meetings are not just about what the ADB is doing, but what we are doing together.
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