Donors pledge $11.3 bln to ADB to tackle poverty

from Reuters

MADRID, Donors to the Asian Development Bank have pledged $11.3 billion for the four years 2009 to 2012 to replenish the multi-lateral body's key poverty alleviation fund for Asia's poorest countries, the bank said on Friday.

The figure marks a 60 percent increase from the $7 billion donated to the ADB's Asian Development Fund in 2005-2008. The fund provides grants and low interest rate loans to the Asia Pacific region's poorest countries.

The bank, whose board of governors are in Madrid for a four-day annual meeting that starts on Saturday, has drawn criticism from the United States that the bank is failing to focus its work on the very poor and lacks accountability.

Washington is concerned the ADB is channelling too much money to middle income countries like China and India, rather than poorer states.

Critics say the ADB has paid more attention to the amount of funds loaned than the effectiveness of aid.

The ADB, funded by its 67 member countries -- 48 from the Asia-Pacific region, 19 from elsewhere, approved a total of $10.1 billion in low-cost loans in 2007 for projects and technical assistance in poorer countries.

Pakistan was the largest borrower, followed by Vietnam, India, China and Indonesia.

The row between the ADB and the United States has overshadowed the annual meeting which will discuss ways to alleviate the impact of soaring food prices on Asia's poor.

The ADB's "Strategy 2020", which focuses on regional integration, was approved by its board this month despite U.S. opposition.