Asian Development Fund

Description

The Asian Development Bank (AsDB) is composed of 68 member countries, 49 of which are in the Asia-Pacific region. Part of the AsDB, the Asian Development Fund (AsDF) provides grants and concessional loans to the AsDB’s 25 lower-income developing member countries to reduce poverty and improve quality of life.

Use of Funds

The AsDB provides grants and concessional loans to support development projects and programs, including infrastructure, policy support, and reform, environmentally sustainable investments, and regional cooperation. Developing member countries (DMCs) eligible for grants include those with lower incomes, those with a moderate or high risk of debt distress, and small island economies. Funds will go toward the second installment for AsDF’s 13th Replenishment (AsDF-13), which runs from 2021 to 2024. DMCs address key development issues, including regional health security, disaster risk reduction, climate change adaptation, and gender equality.

Justification

• In 2021, the AsDB committed $4.1 billion for 15 DMCs to purchase and deliver safe and effective COVID-19 vaccines, making it the largest multilateral financier of vaccines in the region.
• In 2021, the bank announced its intention to reach $100 billion in cumulative climate financing to DMCs by 2030, an increase of $20 billion above what is currently outlined in its 2030 strategy.
• The AsDB launched the Asian Pacific Tax Hub to increase operational support to DMCs by addressing debt sustainability, domestic resource mobilization, and international tax cooperation.
• In 2021, AsDB adopted the Fragile and Conflict-Affected Situations and Small Island Developing States Approach, introducing fragility and resilience assessments and knowledge analytics to better-fit responses to the needs of fragile and conflict-affected situations and small island developing states.