Functions of Asian Development Bank are being discussed here.ADB was opened on December 19, 1966 in the light of views and suggestions of the number of countries to solve the problem of low rate of capital formation in the Economic Commission for Asia and Far East (ECAFE) conference held in Manila during December 1963.
10 Functions of Asian Development Bank
OBJECTIVE:
The objective of establishing ADB was to land funds, promote investment and provide technical assistance to the countries mainly in Asian region. It also contributes for the improvement of social conditions, law and order reforms and welfare of women.
MEMBERSHIP:
Membership of ADB is open to members and associate members of United Nation Economic and Social Commission for Asia and the pacific and other regional countries and non-regional development
countries which are members of UNO or of its any specialized agency. It was initially setup with 31 members. Now it has 67 members, 48 from the region and 19 from other parts of the world. Pakistan has been the member of ADB since 1966.
CAPITAL:
The initial authorized capital of ADB was 55 billion dollars. Bank’s operations are financed through two main sources. (1) Ordinary capital sources: Ordinary capital resources are obtained through paid up capital from member countries. (2) Special funds: These are obtained from contributions of developed member countries transferred amount from ordinary capital resources.
MANAGEMENT:
The headquarter of the ADB is in Manila (Philippines). Board of Governors, Board of Directors, a President and six Vice-Presidents manage it. The bank has 30 resident, regional, representative and other country field offices. Each member country nominates one Governor and one Alternate Governor to vote at meetings on its behalf. All these Governors then elect 12 members of Board of Directors, 8 Directors from Asia Pacific Region and 4 from countries outside the region.
FUNCTIONS:
- It words for the development of trade and commerce among member countries.
- It provides finance to underdeveloped and developing countries.
- It promotes investment both of public and private capital in the ECAFE region.
- It arranges loans from WB and IMF for member countries.
- It provides technical assistance for the development projects of developing countries.
ADB AND PAKISTAN:
Pakistan is the ninth largest shareholder of ADB among regional members. ADB has helped Pakistan in meeting temporary financial crises. It has also helped in the process of debt servicing. Besides this ADB has extended help in different diversified areas. This can be judged from the following points.
- Helping reforms in Pakistan Judicial system.
- Aid for the uplifting of living standard in rural areas.
- Aid to help export industry of Pakistan.
- Helping to set up micro finance institviions in Pakistan.
- Helping for the improvement of c orporate governance in Pakistan’s capital market.
ADB provided risk guarantee scheme for trade finance in Pakistan. This guarantee scheme is applicable in relation to trade finance for small and medium enterprises.
Final Recommendation; Functions of Asian Development Bank.
The Asian Development Bank (ADB) is a regional development organization that provides financial and technical assistance to its member countries in the Asia-Pacific region. Some of the main functions of the ADB include:
- Providing loans and grants: ADB provides loans and grants to its member countries to support their economic and social development. These loans and grants are typically used to finance infrastructure projects, such as roads, railways, and power plants, as well as to support social programs like education and healthcare.
- Supporting private sector development: ADB provides financial and technical assistance to private sector companies to support their growth and development. This includes providing financing for small and medium-sized enterprises, as well as supporting public-private partnerships in infrastructure development.
- Promoting regional cooperation and integration: ADB supports regional cooperation and integration by promoting trade and investment among its member countries. This includes supporting the development of regional transport networks, energy grids, and other infrastructure that facilitates regional economic integration.
- Strengthening governance and institutional capacity: ADB provides technical assistance to its member countries to strengthen governance and institutional capacity, including support for public sector reform, anti-corruption measures, and legal and regulatory frameworks.
- Addressing social and environmental challenges: ADB supports its member countries in addressing social and environmental challenges, such as poverty reduction, gender equality, and climate change mitigation and adaptation.
Overall, the ADB’s mission is to promote sustainable economic growth, reduce poverty and promote social development in its member countries in the Asia-Pacific region.