Asia prosperity requires more innovation, Inclusion and integration: ADB President

DELHI, INDIA: Growth in Asia and the Pacific has been more robust than expected after the global crisis, and must be sustained for the region to reduce poverty and increase prosperity, Asian Development Bank (ADB) President Takehiko Nakao said in his first address to the ADB Board of Governors.

“Asia is making the transition to growth led by domestic and regional demand,” he said.

“But Asia cannot be complacent. To achieve sustainable growth, I believe Asia must become more innovative, more inclusive, and more integrated.”

The new ADB President emphasised the need for an enabling environment in which the private sector can grow, innovate, and create jobs. Critical elements include conducive regulatory systems, support for start-ups, broad-based financial systems, and infrastructure development. Governments must also invest more in their people, providing vocational and tertiary education, and accessible, cost-effective health services.

“All of these must be underpinned by good governance. The rule of law and it’s just implementation, accountability, and protection of property rights are essential in building a better a climate for investment and innovation,” Nakao said.

With more than 800 million people in the Asia-Pacific still living in absolute poverty, the region has to address rising inequality, Nakao noted. For the region’s growth to be sustainable, it also needs to be inclusive, requiring the region to address issues like income inequality, access to good education and health services, gender equity, and provision of social safety nets.

“Inclusive growth is ultimately an issue of empowerment,” Nakao said. “Empowerment is not just a means of development, but should also be a primary objective of development.”

More can be done toward creating a truly integrated Asia, the President noted, pointing to the success of the Greater Mekong subregion, Central Asia, and South Asia in connecting transport and energy networks, and the potential for improved ICT connectivity to integrate isolated Pacific island economies into the Asia and Pacific region.

“The re-engagement of Myanmar presents a great opportunity for deepening integration, with the promise of substantial gains for Asia and the world as a whole,” he said.

The President noted that Asia’s growth in the world economy brings with it a new responsibility – the responsibility to contribute to solving global issues like climate change and the post-2015 Millennium Development Goals agenda.

In considering ADB’s role in the region, Nakao highlighted the need for finance, leverage, and knowledge to better meet the region’s needs. He committed ADB to step up efforts to leverage bilateral official sources of finance, private sector finance, and public-private partnerships, and to combine finances more closely together with development knowledge.

The President also announced the initiation of a mid-term review of Strategy 2020 “based on the progress of its implementation, and also on developments in Asia since its adoption in 2008.” He said ADB will also consider a long-term strategic vision for the Asian Development Fund in line with the region’s changing needs.

While the general capital increase in 2009 and successful ADF replenishments have strengthened ADB’s financial resources, the President noted that ADB must “continue examining how we can secure the resource base needed in order to continue to pursue our objectives well.”

Nakao closed his address by saying that “Perhaps what matters most is ADB’s performance and the results it achieves… I will place the highest priority on outcomes to ensure we respond to the region’s needs as efficiently and effectively as possible.”

Regarding human resources, Nakao said: “ADB is fortunate to have a diverse staff of talented, professional, and determined women and men. I intend to promote the potential of all our staff through a proactive talent management process.”