Notes on the beat: Has ADB done enough to solve global problems?

Louise Maureen Simeon - The Philippine Star
Notes on the beat: Has ADB done enough to solve global problems?
Now, the longstanding Israel-Palestine conflict has worsened, climate change has pushed the global emergency button, while computers and robots are feared to soon replace humankind.
Business World

MANILA, Philippines — Nearly six decades ago, about 100,000 civilians and military personnel perished as the Vietnam War escalated, the human spaceflight program Project Gemini was completed and the world witnessed the birth of the automated teller machine.

Now, the longstanding Israel-Palestine conflict has worsened, climate change has pushed the global emergency button, while computers and robots are feared to soon replace humankind.

From 1966 until 2024, the Asian Development Bank (ADB) has witnessed a myriad of both problems and developments, released billions of dollars worth of loans and grants to developing economies and continued to envision an Asia-Pacific region that is inclusive, sustainable and resilient.

In the 1960s, ADB’s focus was on food production and rural development. Such priorities remain the same today and a whole lot more.

A few weeks ago, The STAR joined the ADB Developing Member Country Journalists Program for the 57th ADB Annual Meeting in Tbilisi, the capital city of Georgia, whose cobblestone streets and graffiti-filled walls boast of its rich art and its long, colorful history that goes all the way back to the time of the lost empires.

The four-day meeting gathered government officials from almost 70 countries, development partners, private sector and civil society organizations (CSOs) to assess current and future financial and economic conditions and their impact on the world, especially on vulnerable states.

I was told that ADB’s annual meet is usually unexciting – predictable even – as leaders discuss and try to come up with solutions to problems that were already there many years ago, but now piled up and worsened, such as climate change, food insecurity, inequality and poverty, among others.

But it was not the case this year as the over 2,000 participants witnessed consecutive days and nights of protests by hundreds of Georgians, triggered by the controversial foreign influence bill patterned after a Russian law, which could undermine Georgia’s aspirations to join the European Union. The annual meet coincided with the approval of the bill on second reading earlier that week.

During ADB President Masatsugu Asakawa’s reception dinner, Georgians trooped right outside the Paragraph Hotel in a seemingly good strategy for the police to not engage and be violent. After all, the host country will never want anymore brutality in front of global leaders.

Unfortunately, ADB has not issued any comment on the political situation in Tbilisi at the time.

Accountability, reforms

As Georgians try to fight against threats to media freedom and their EU dream, this served as a sharp backdrop for CSOs to criticize ADB’s actions and challenge its policies and projects that are said to have detrimental impact on communities and environments.

The NGO Forum on ADB, a network of CSOs monitoring the projects, programs and policies of the multilateral lender, is demanding that the bank uphold the highest standards of environment and social safeguards.

CSOs are in agreement that the draft environmental and social framework (ESF) lacked transparency and accountability and that their inputs from two years of engaging with ADB were not actually incorporated.

Groups argued that the draft ESF’s approach to addressing harm caused by projects is vague, with inadequate provisions for identifying and mitigating impacts on affected communities.

For one, it should be noted that for years, ADB has supported coal and fossil gas projects which one may see as a contradiction to climate financing that it has committed.

In 2021, ADB pioneered the concept of an energy transition mechanism (ETM) that would initiate a “secure and cost-effective” phaseout of coal-fired power plants and eventual shift to clean energy.

The Philippines was one of three countries, alongside Indonesia and Vietnam, that served as a pilot for the ETM. Within the three countries, the ETM targets to retire 50 percent of the coal fleet and reduce 200 million tons of carbon emissions every year.

Further, CSOs argued that ADB’s proposed safeguards on pollution prevention and resource efficiency are insufficient, lacking concrete measures to address hazardous waste management and phase out harmful practices such as thermal waste-to-energy projects.

The draft ESF likewise lacked protections for indigenous people, as well as measures to safeguard cultural heritage.

“The proposed safeguards policy by the ADB is a disservice to the very communities it claims to protect and the environment it purports to preserve,” the CSOs said.

“We need a robust safeguards framework that holds the ADB and its partners accountable for their actions, ensures transparency and participation and prioritizes environmental sustainability and social justice,” they added.

CSOs rejected the ESF draft and demanded its immediate overhaul with binding requirements.

More engagement

ADB Fragility and Engagement director Benjamin Graham told The STAR that ADB is already engaging quite extensively with CSOs at different levels to ensure that their voices are heard and that policies will reflect their inputs and concerns.

As of now, ADB is developing a civil society engagement approach which will serve as an operational guide to improve how the bank engages with CSOs across sectors.

At the country level, when a new country partnership strategy is being developed, ADB consults with CSOs as it moves to be inclusive and to determine the kind of projects that are critical for every economy.

Moving forward, Graham said there will definitely be more engagement with groups especially with major challenges such as climate change that will hit vulnerable groups more. ADB is cognizant of the fact that civil society is a good platform to engage with in terms of addressing such issues.

Just like the government in Tbilisi that can never escape its protesting citizens until they get what they want, ADB can also never get away with demonstrations outside its headquarters in Mandaluyong.

“We take the concerns of civil society groups such as those who occasionally protest very seriously. ADB is genuinely open to receiving these concerns and to engaging with organizations when they bring these forward,” Graham said.

Unfinished agenda

ADB’s major capital management reforms unlocked up to $100 billion in new lending capacity for the next decade.

The bank also committed $23.6 billion in loans, grants, guarantees, equity investments and technical assistance last year, including $9.8 billion in climate finance from ADB’s own resources.

The Philippines alone was the biggest recipient of combined loans and grants worth $8.4 billion in 2023. Over the past year, the bank has supported key projects related to business and employment, agriculture, inclusive finance and critical infrastructure projects.

As ADB crafts the new country strategy partnership, the Philippines maintained that the bank has an important role in the country’s digitalization efforts as well as in bolstering human capital development particularly in education and nutrition sectors.

It is certain that the problems of the world will not disappear even if ADB pours all its assets to every economy in need.

But it is also true that ADB needs to be called out when it is not making sound decisions in terms of its financing.

The global population is continuously growing, with more people competing for scarce resources, political tensions are threatening peace and stability in many economies and the impacts of climate change are unprecedented in scale.

ADB’s role as a development bank can never be more important than now as the world confronts the biggest challenges of our time.

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