The Philippines, which is expected to rise to upper middle-income status this year, is making its first-ever contribution to the Asian Development Bank’s (ADB) grant fund intended for the most vulnerable and least developed countries (LDCs) under the multilateral agency, the Department of Finance (DOF) said in a statement yesterday.
Carlos Dominguez, DOF secretary, said the Philippines’ contribution to the Asian Development Fund (ADF) will be announced during a pledging session to be held on the sidelines of the ADB’s 53rd Annual Meeting set in May this year in Incheon, South Korea.
“Since the Philippines’ graduation from ADF assistance in 1999, we have yet to contribute to the replenishment of the Fund. Now, as we move to the upper middle-income status, the country is poised to extend help to the LDCs (least developed countries), including some of our neighbors in the Association of Southeast Asian Nations (Asean) and the Pacific,” Dominguez said.
The pledging session for the ADF scheduled on May 2 will be the 12th time that the ADF will be replenished since it was established in 1974.
The ADF’s total replenishments has reached $4.01 billion, inclusive of $2.59 billion in donors’ contributions.
Dominguez said contributing to the Fund will prove beneficial to the Philippines and the rest of the Asia-Pacific, given that the growth of LDCs will provide the Philippines and the rest of the region with new potential markets to further bolster domestic economic expansion as well as regional growth.
The finance chief added Manila’s contribution to the ADF conveys goodwill to the region’s LDCs, whose economic and social development will also have an external benefit to the Philippines in terms of strengthening regional health security by preventing the transmission or outbreaks of HIV-AIDS, malaria, tuberculosis and other major illnesses.
In his first courtesy call to President Duterte, Masatsugu Asakawa, the multilateral agency’s president, thanked the Chief Executive for Manila’s planned contribution to the ADF.
The ADB’s ADF grant facility aims to promote poverty reduction and improvements in the quality of life of people in LDCs of the Asia-Pacific region.
It is specifically dedicated to support ADB’s poorest and most vulnerable developing member-countries, such as Afghanistan, Cambodia, Kiriba, Kyrghyz Republic, Maldives, Marshall Islands, Federated States of Micronesia, Nauru, Nepal, Samoa, Solomon Islands, Tajikistan, Tonga, Tuvalu and Vanuatu.
The ADF is currently being supported by non-regional donors, such as selected European countries, the United States, Canada and Turkey, and regional donors (Australia, China, India, Japan, Kazakhstan, South Korea, New Zealand, Taipei and selected Asean countries).
Some Asean countries that have graduated from ADF assistance like Thailand and Indonesia are now donors to the ADF.
The DOF said the Philippines has been supportive of various initiatives of other institutions such as the World Bank (WB), International Monetary Fund (IMF) and the United Nations (UN) to assist LDCs.
It is a continuous donor to the WB’s International Development Association and the UN’s International Fund for Agricultural Development.
The Philippines, through the Bangko Sentral ng Pilipinas, extended until the end of 2020 a $1-billion loan facility to the IMF through a bilateral borrowing agreement, which was first signed in 2013, to support countries going through financial difficulties.
The DOF said this loan will help strengthen the global financial safety net and contributes to the IMF’s overall lending capacity of about $1 trillion for an additional year.
