ADB vows to fight money laundering

The Asian Development Bank yesterday said it will follow a ‘zero tolerance’ policy against corruption, tax evasion and money laundering.

ADB President Takehiko Nakao spoke about the stance of his organisation at the 49th annual meeting of its board of governors that began at the Messe Frankfurt in Frankfurt.

More than 3,000 delegates, including senior government officials, business leaders, journalists, academics, and representatives from civil society and development organisations, are attending the four-day event.

As the global financial system is increasingly being exposed to vulnerabilities such as cyber attacks, Nakao said: "How to use international technology in an effective way is a challenge."

How the countries should use offshore financial centres without creating the scope for money laundering is also a big challenge, he said.

The issue of cyber security came to the fore across the world after hackers broke into the system of the central bank of Bangladesh and stole about $101 million from its account with the Federal Reserve Bank of New York.

Most of the Bangladesh Bank funds lost in the cyber attacks ended up in Manila where the ADB is headquartered.

Nakao said no organisation, even the ADB, is immune to cyber attacks.

Gerd Muller, the German minister for economic cooperation and development, in a seminar on the sidelines of the meeting, said developing nations lose $1,000 billion a year to money laundering. “There should be transparency in money movement,” he said.

Under the theme ‘Cooperating for Sustainability’, this year’s ADB meeting will highlight the critical importance of sustainable, inclusive development and the need for closer Asian and European linkages to support it.

The recent adoption of the sustainable development goals to replace the millennium development goals has highlighted the need for greater sustainability and inclusiveness in global development.

When asked about global warming and its impact on nations, which is a key topic of this year’s meeting, Nakao said: "Bangladesh is one of the countries susceptible to the sea level rise. Attention should be given to the issue."

The ADB is supporting Bangladesh with rehabilitation programmes to mitigate the sufferings of the climate change victims, he said.

On Bangladesh's textile industry, Nakao said he is happy to see that the government is serious about improving the working conditions in factories.

Greater attention of global partners and consumers is also helping Bangladesh improve the working conditions, he said.

Meanwhile, the 2016 governors' seminar -- Structural Reforms: Pathways to Sustained Growth -- will examine the factors causing the current global growth slowdown and the reforms needed to address constraints and put the world back on a path towards sustained and inclusive growth, according to the ADB.

Delegates will discuss other topics crucial to the issue of sustainability and inclusiveness such as what is needed to achieve 'green' cities, the finance and technology required to both mitigate and adapt to the impacts of climate change.

The meeting will also highlight the essential role the private sector increasingly plays in supporting low-income groups, with an awards ceremony to be held for ADB client companies who have developed innovative products and services that have benefitted the poor.

Host country, Germany, will showcase its own innovative approaches to sustainable living in a 'City of Sustainability' exhibition with examples of creative cooperation used to resolve urban problems and to make cities more green and livable.

ADB SIGNS DEAL WITH AIIB

Meanwhile, ADB President Nakao and Asian Infrastructure Investment Bank (AIIB) President Liqun Jin signed a memorandum of understanding (MoU) yesterday on the sidelines of the ADB's annual meeting.

The agreement sets the stage for jointly financing projects. The ADB and AIIB are already discussing projects for co-financing in the road and water sectors. The first of these projects is expected to be Pakistan's M4 highway project, a 64-kilometre stretch of motorway connecting Shorkot to Khanewal in Punjab Province, according to the ADB.   

The ADB and AIIB agreed to strengthen cooperation, including co-financing, at the strategic and technical levels on the basis of complementarity, value added, institutional strengths and comparative advantages, and mutual benefit, the MoU said.

“I am very pleased to have this framework of collaboration with a new and strong partner in Asia,” said Nakao. “The ADB has been working closely with the AIIB throughout its establishment process. We will further strengthen our cooperation in promoting sustainable growth, reducing poverty, and combatting climate change in the region.”

“I am delighted to take a further step forward in our partnership with the ADB,” Jin said. “The AIIB looks forward to deepening our already strong relationship and expanding our collaboration as we seek to address the significant infrastructure financing needs in the Asia region.”

Through co-financing, knowledge work, and joint policy dialogue with member countries, the two institutions will work together in the areas including energy, transportation, telecom, rural and agriculture development, water, urban development, and environmental protection.

The two institutions will undertake regular high-level consultations and joint data collection to promote the implementation of the sustainable development goals.