Asia “can not afford to grow now and clean up later”, ADB president Haruhiko Kuroda declared yesterday, in a swipe at countries that argue they should be allowed to pursue economic development without being accused of damaging the environment.
He drew attention to the need for the ADB to secure a substantial replenishment of its soft-loan window, the Asian Development Fund (ADF), so that it can play a bigger part in climate change mitigation and dealing with environmental degredation.
In a speech to ADB governors, Kuroda challenged emerging economies in Asia to “assume greater social responsibilities” in areas such as protection of the environment and dealing with climate change.
Asia should “ensure that its rise within the global economy is harmonious within itself and within the global community,” he said.
“Working together for a greater good is not always easy, and sometimes requires the sacrifice of individual benefits. But it is absolutely necessary.
“With increasing pressure of economic activity on the environment, how can best can be secure an environmentally sustainable development legacy. I believe that Asia cannot afford to grow now and clean up later.”
Kuroda appealed to ADB governors to support what he told Emerging Markets in a recent interview is the push the ADB will be making to secure a substantial replenishment of the ADF. Replenishment negotiations are due to begin around October this year.
The ADB needs a substantial topping up of its financial resources in order to finance a major assault on mitigating the impact of climate change in Asia and to counter the environmental and human damage this phenomenon is causing, Kuroda said.
“Our last ADF replenishment has enabled us to push forward on [issues such as] mainstreaming climate change,” Kuroda noted in his speech at the formal opening yesterday of the Hanoi annual meeting “But much more remains to be done.”
Meanwhile, the ADB is “climate-proofing our infrastructure projects” in parts of Asia as well as boosting efforts to mobilize private sector investment in areas in key areas such a environment-friendly infrastructure, he noted.
Kuroda also signalled the ADB’s concern with rising inflation. “Although inflation across the region has been generally low – 4.4% last year – some economies are showing signs of overheating as they return to a path of rapid growth,” he said.
“Rising oil and food prices are adding to this pressure. Policymakers need to consider precautionary means to contain inflation, not least because it is the poorest citizens who will bear the brunt of its impact,” he added.