Tuesday, December 15, 2009

Asian Forecast Much Improved As Infrastructure And Freight Transport Developments Continue

Asian Development Bank Continues to Support Regional Growth
Shipping News Feature

MANILA – PHILIPPINES – The Asian Development Bank (ADB) issued a report today showing better than expected financial figures for the region. Developing Asia comprises 45 member countries of ADB and covers Central Asia, East Asia, South Asia, Southeast Asia and the Pacific and these are the areas which receive advice and support from the Bank. New investments in supply chain and logistics development have continued throughout the downturn.

The ADB release shows many of the countries involved have performed well during a difficult period. This has prompted the bank to issue its new development forecast showing regional growth of 4.5% in 2009 increasing to 6.6% next year. This means an upswing from September’s projections of 3.9% and 6.4% respectively. The bank believes East Asia (China, S.Korea, Mongolia and Taiwan) will grow 5.1% and 7.3% in 2009/10, South East Asia (Brunei, Cambodia, Thailand, Laos, Indonesia, Malaysia, Myanmar, Singapore, Vietnam and the Philippines) will only manage 0.6% this year but 4.5% next.

Last week ADB announced it was to lend around $1 billion for freight and passenger rail development in South West China to enable faster, cleaner access to under developed provinces of Guangxi, Guizhou, Sichuan, Yunnan and Chongqing. This represents about a third of the cost, the balance funded by the Chinese Government.

In Bhutan the ADB have just granted their largest ever assistance package to the remote state to finance the 800 kilometre highway from Sipsoo in the West to Eastern Daifam. The money will pay for 180 kilometres of highway construction and upgrades to start the project which is intended to open up this remote and reclusive country to industrial development, particularly the southern areas. Private contractors will carry out all works and be subject to design and environmental considerations in this wild and mountainous state.

Yesterday the ADB agreed to pay the first stage of a $630 million loan to enable Vietnam to update and reform state companies, including the logistics provider Southern Waterborne Transport Corporation and infrastructure development enterprises with a view to energising and promoting growth. The Vietnamese Government has been trying to further privatisation and the set up of limited companies for almost twenty years but the process has proved lamentably slow. This new process is intended to kick start the Vietnamese private distribution and manufacturing centres.

In other ADB news the joint project with the World Bank to develop the Alat-Astara highway in Azerbaijan has been halted after extensive protests by local residents. Their complaints that they have been deceived over the amounts of compensation they were promised in exchange for development on their land seem to have sparked the protests and an ADB mission will visit the area to investigate before they release funds. Up to now no contractor has been appointed to carry out the works and the Government are anxious to play down the dispute. The two banks are financing separate sections of the highway which runs up to the Iranian border. $200 million of ADB money has been set aside for their part of the project.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members – 48 from the region. In 2008, it approved $10.5 billion of loans, $811.4 million of grant projects, and technical assistance amounting to $274.5 million.

Pic: Freight Transport in the Himalayas  © Dan Shingleton