Phl, Asia must address rising inequality - ADB chief

MANILA, Philippines - Rising inequality still remains as a long-term problem for the Philippines and the rest of the Asia and the Pacific region, the Asian Development Bank (ADB) president said Wednesday.

"Unfortunately, while the region has made remarkable progress in reducing poverty, the benefits of growth have yet to reach several hundreds of millions of Asians who continue to struggle on less than $1.25 a day," Haruhiko Kuroda said in a press conference marking the start of 45th annual meeting of the bank's board of governors.

Kuroda said the Asian region's economic prospects will be the key focus of the four-day meeting, sharing optimism with regard to the countries' growth momentum.

"As you may be aware, our recently released Asian Development Outlook 2012 suggests that the Asia and Pacific region should be able to maintain its growth momentum despite ongoing troubles elsewhere in the world. The report forecasts a healthy GDP (gross domestic product) growth of 6.9 percent for developing Asia and the Pacific in 2012, and 7.3 percent in 2013," Kuroda said.

The ADB president added that the Philippines, being the host government, has chosen "inclusive growth through better governance and partnerships" as the theme for the meeting.

Privatization

Meanwhile, various cause-oriented groups protested at the ADB meeting, condemning the bank's alleged role in the privatization of the energy and water sectors and in promoting the use of coal and other environmentally unsustainable technologies in the region.

"There is no doubt that privatization of these services causes harm to peoples and the environment as shown by the experiences of communities and peoples in Asia. Because of privatization of these basic services, millions of impoverished and marginalized have much less access to safe and clean fresh water with the deterioration of the quality of service and the sharp increases in the cost of service," Lidy Nacpil, coordinator of Jubilee South Asia/Pacific Movement on Debt and Development said in a statement.

The Freedom from Debt Coalition (FDC) said the multilateral financial institution has been involved in the privatization of water services in the Philippines, Indonesia, India, Pakistan, South Korea, Nepal and Sri Lanka.

Ricardo Reyes, FDC president, said the Philippines' Power Sector Restructuring Program of the ADB led to the legislation of the Electric Power Industry Reform Act (EPIRA), which has forced the government "to increase the generation rates to attract more investors to participate in the privatization of government’s generation assets."

"After more than 10 years of EPIRA implementation, the Philippines now has the most expensive electricity rates in Asia. Mindanao, the southern part of the country, is still experiencing rotational blackouts. Worse, the Philippine government is holding people hostage: pay more for electricity and accept coal," Reyes said.

FDC added that the privatization of the Metropolitan Waterworks and Sewerage System (MWSS) has negatively affected Metro Manila residents, especially the urban poor communities.

"Contrary to the positive promises of water privatization, what we experienced is the opposite. In just 12 years, water tariffs have risen exponentially by almost 1000 percent. Water lost to leakages in the West zone is higher than pre-privatization levels. The MWSS has still continued to incur more debts," FDC said.

More than 4,000 participants from all over the world attended this year's meeting, which will focus on the region's economic prospects and inclusive growth, ADB President Haruhiko Kuroda said Wednesday.