The summary of the 54th annual meeting of the board of Governors. The meeting occurred virtually on May 3 - 5 2021. Topics covered were Annual report, Updates to rules and reguations, Budget for 2021, Status of the Financial Resources of the Asian Development Bank, Financial Statements, Management's Report on Internal Control over Financial Reporting, and Independent Auditor's Reports, Allocation of Net Income.
This publication describes how state-owned enterprises (SOEs) can access finance on commercial terms, without sovereign guarantees. Doing so can create fiscal space for governments and new sources of finance for needed investment. Under Strategy 2030, the Asian Development Bank is committed to SOE reform that supports access to commercial finance in its developing member countries. The publication confirms the rise of commercial finance for SOEs and details steps to enhance the bankability of SOEs. This includes practical guidance on how to improve governance and increase financial viability. The publication also explains how the risks of such borrowing, including defaults and moral hazards created by implicit guarantees, can be managed.
Due to globalization and development in financial integration over the last three decades, gross foreign assets and liabilities have increased dramatically in developed and emerging countries. The foreign assets and liabilities of developed countries were, on average, about 50% of GDP in the early 90s, but now reach nearly 400%. Emerging countries have historically tended to have more foreign liabilities than foreign assets, but both have gradually increased in size since the 90s. Regardless of their foreign asset and liability portfolio positions, countries are exposed to capital gains and losses from external balance caused by fluctuations in exchange rates and asset values, and the impacts become more substantial because of the size effect. For example, the cumulative gain of the United States, a country well known for huge capital gains from the external position, stands at about 30% of its GDP (annually, 1.5% of its GDP) over the last two decades, while the cumulative loss of Korea is about 20% of its GDP (annually, 1.0% of its GDP) for the same periods.
Philippine local governments were given increased autonomy, revenue-raising and expenditure responsibilities under the Local Government Code of 1991 (LGC). At the same time, the LGC instituted the intergovernmental fiscal transfer called the internal revenue allotment (IRA) to help to help local governments fulfill their mandates recognizing fiscal imbalance in devolved functions. Apart from this, national government provides additional assistance to local governments through programs lodged in different agencies that are meant for devolved infrastructure services. This study examines these national government programs, evolution and expenditure trends and surveys the literature of assessments of these programs. Understanding the evolution in the design and implementation of these programs would be a powerful tool moving forward with strengthened decentralization, especially in designing policy for national government oversight agencies and for any envisioned support programs of national government. In the past decade, the three programs that received the largest budgetary allocations, are the Department of Public Works and Highways' Local Infrastructure Program, Department of Agriculture's Farm to Market Road programs and the Department of the Interior and Local Government's Financial Subsidy to Local Government Units (LGUs). Though expenditures on these programs have been increasing as a whole, there have been no clear trends for the individual programs except for one performance-based program. Furthermore, several programs were initially targeted toward poorer LGUs but eventually expanded in coverage because of the low uptake of these targeted LGUs. These national government programs have almost 100% budget utilization rates compared to lower utilization rates of local development funds (which are the primary source of infrastructure investments of LGUs). This, combined with the evidence of low uptake of assistance programs by poorer LGUs, offer two clear considerations for policymakers in strengthening local government oversight especially if the assistance programs will be discontinued. First, ensure that local governments will spend on infrastructure, i.e. at the very least spend the mandated local development fund. Infrastructure spending has the largest impact on incomes and in jumpstarting the economy and the path to growth would be arduous if this slows down as a result of insufficient local government investments absent national government programs. Second, if policymakers decide to maintain a more targeted assistance program, its objective, criteria and monitoring and evaluating plan should be clear. It should be complementary and aligned with the assistance programs of the Seal of Good Local Governance and Community-Based Monitoring System Laws to be efficient in the use of public funds. The goal moving in recovering from COVID coupled with the implementation of the Mandanas ruling is how to protect the vulnerable with social safety nets but also ensure that local governments contribute to economic recovery, of which infrastructure spending brings the largest multiplier effect.
The overall aim of this book is to set forth debate on alternative practices for land use management in urban development and public infrastructure projects in Asia. Land use laws are the most powerful tools that governments have to implement public projects with large social and economic gains. While there are numerous books that have examined specific methods of land assembly for development and financing of public infrastructure, there is a gap in the literature on a comprehensive treatise that looks at the whole range of methods from their institutional context, suitability for purpose, and equity considerations. It is hoped that this volume will go some way toward filling that gap by presenting the basis and approaches for land use management that have been used in Asia, and suggesting key principles and components of equitable land use management practices for development and financing of infrastructure. It may be emphasized here that this volume does not examine the expropriation or confiscation of inherited and private property for land reform or other social transformative purposes, which while important, are out of scope of this book.
Today, the US dollar is the world's dominant, if in practice also the sole, reserve currency. This makes financial stability across the world hostage to swing in the dollar and hence to America's economic fortunes. How Asian economies manage this tension, and whether an alternative reserve currency will emerge to buffer the safety-net, will be important determinants of their convergence with advanced economies. The understanding of this challenge has to start with the renminbi and its chances of rivalling the dollar because, just as China's dominance in global trade defined the last two decades, its emergence at the heart of global finance could define the next two decades.
The Supreme Court (SC) ruled with finality in April 10, 2019 on the motions for reconsideration of its initial decision promulgated in July 3, 2018 on the petitions filed by separately by Mandanas et al. and Garcia regarding what petitioners perceived to be errors in the computation of the Internal Revenue Allotment (IRA) or the LGUs' share in national internal revenue taxes (NIRTs) as mandated under Section 284 of the 1991 Local Government Code (LGC). As a result, the IRA in 2022 will increase by P225.3 billion relative to what it would have been prior to promulgation of the said ruling to reach PhP 1,102.7 billion. This study proposes that said increase in the IRA be sourced by unfunding PAPs in the budgets of some national government agencies that are actually intended to deliver functions that are assigned to LGUs under the LGC with the end in view of ensuring sustainability of the national government's fiscal position. It then proceeds to these PAPs on the basis of the 2020 General Appropriations Act. It also evaluates the impact that this manner of financing the increase in the IRA has on the vertical fiscal balance across different levels of local government and horizontal fiscal balance across individual LGUs within each level of local government.
The results of the most recent official health survey in Turkey, announced in June 2020, indicate an increase in tobacco prevalence rate. i With 28 percent of adults smoking daily, Turkey currently has the second-highest smoking rate among OECD countries. ii Given that a health indicator in one of the Sustainable Development Goals (SDGs) is related to tobacco use, the recent statistics show that Turkey has already diverged from the respective goal. The adverse health effects of tobacco use and its subsequent economic burden compels countries to implement tobacco control policies. Although Turkey was the first country to adopt all MPOWER measures (declared by the World Health Organization (WHO) to guide policy making) at the highest level, contrary to expectations its smoking prevalence is not decreasing. This note is related to the effect of taxes (the only price-related measure) on tobacco consumption in Turkey. Currently, the total tax burden on a cigarette is higher than that in the European Union (EU) countries, on average. Despite the high tax burden on tobacco products, people in Turkey continue to smoke. Although contradictory at first sight, the outcome is consistent with economic theory. Consumption decisions are based on final prices, not on taxes paid. They are also based on disposable income. Therefore, it is necessary to analyze the effect of tobacco taxes on consumption by taking the affordability of tobacco products into account.
As required by the multitranche financing facility (MFF) policy,1 this 2019 Multitranche Financing Facility Annual Report consolidates key findings on MFF performance based on the annual MFF progress reports submitted by the five regional Asian Development Bank (ADB) departments, and the information prepared by the Controller's Department and Partner Funds Division of the Sustainable Development and Climate Change Department of ADB. The annual MFF progress reports attached in Appendix 1 provide (i) progress made on each of the physical and nonphysical components; (ii) risks and issues, and actions being taken to mitigate the risks and resolve the issues; (iii) updated design and monitoring frameworks; (iv) the status of compliance with clients' commitments to make or maintain certain undertakings over the term of the MFF; and (v) any changes in circumstances or material facts relating to the investment program or plan.
This report proposes a renewable energy subsidy mechanism for Indonesia to close the gap between the costs of renewable and conventional power generation. It takes into account the additional economic benefits of renewable power and considers how the government can support its rapid deployment in the power sector. The report emphasizes the need for Indonesia to adopt international best practice for planning, procurement, contracting, and risk mitigation to reduce the financial costs of renewable energy development. To achieve this, implementation of the subsidy should be part of a broader inter-ministerial electricity policy reform program.
Development Research News is a quarterly publication of the Philippine Institute for Development Studies (PIDS). It highlights the findings and recommendations of PIDS research projects and important policy issues discussed during PIDS seminars. PIDS is a nonstock, nonprofit government research institution engaged in long-term, policy oriented research.
1. The 2018 Multitranche Financing Facility Annual Report consolidates the key findings on MFF performance that were reported in the annual multitranche financing facility (MFF) progress reports by the five regional departments of the Asian Development Bank (ADB) (Appendix 1). 2. As required by the MFF policy paper,1 these progress reports provide, for all approved MFFs in each country, (i) progress made on each of the physical and nonphysical components; (ii) risks and issues, and actions being taken to mitigate the risks and resolve the issues; (iii) updated design and monitoring frameworks; (iv) the status of compliance with clients' commitments to take or maintain certain undertakings over the term of the MFF; and (v) any changes in circumstance or material facts relating to the investment program or plan.
This publication showcases activities and results of financing partnerships of the Asian Development Bank (ADB) in 2018. Stories illustrate how these partnerships have made a significant difference in the lives of the poor. ADB partners benefit from the wide range of financing options as they seek to begin or expand their commitment to developing Asia and the Pacific as well as support ADB's strategic priorities as indicated in its Strategy 2030. The donor report is intended for current and prospective official and other concessional development financing partners of ADB.
The Clean Energy Financing Partnership Facility (CEFPF or the Facility) was established by the Asian Development Bank (ADB) in April 2007, to assist developing member countries (DMCs) improve energy security and transit to low-carbon use through cost-effective investments, particularly in technologies that result in greenhouse gas (GHG) mitigation (Appendix 1). CEFPF is composed of the Clean Energy Fund (CEF), the Asian Clean Energy Fund (ACEF), the Carbon Capture and Storage Fund (CCSF) and the Canadian Climate Fund for the Private Sector in Asia (CFPS). The Facility contributes to the energy sector in achieving the scaled up ADB's annual target set in September 2015, ADB pledged to double its annual climate financing to $6 billion by 2020, with $4 billion for climate mitigation and $2 billion for climate adaptation. The energy sector is expected to contribute about $3 billion to climate mitigation. The overall implementation progress and operational results of CEFPF from the period 01 January to 31 December 2018, measured against the design and monitoring framework (DMF) and the 2018 Annual Work Program, is provided in this 2016 Annual Report. The DMF is attached as Appendix 2.
This publication was prepared for the Cross-Border Settlement Infrastructure Forum (CSIF) to support its efforts to establish central securities depository and real-time gross settlement linkages. It aims to build a common understanding among CSIF members about international standards and gateways for these linkages, including user requirements and technical specifications. The publication reflects the collaborative efforts currently underway to further harmonize and integrate bond markets among the ASEAN+3 economies.
