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better cooperation with its neighbours India and Nepal in transport and
energy sectors. "Regional integration on transport and power will
substantially benefit the South Asian countries, especially Bangladesh,"
Haruhiko Kuroda told a press conference at Sonargaon Hotel in the capital
yesterday. The Manila-based ADB boss, arrived in Dhaka yesterday on his
maiden two- day visit, also viewed that a regional power grid could be
popular among the nations. Kuroda sees no significant progress in
cooperation among the South Asian nations, although the lending agency
has long been pushing for it. "Many discussions were held, but so far very
few investment projects have been implemented in the region," observed the
ADB chief. However, he hopes for a change in future. Pointing to the
benefit of regional integration, Kuroda, also a renowned Japanese
economist, said, "China, Vietnam, Laos, Cambodia and Myanmar have
implemented many regional projects on transport, energy, communication and
water management and become benefited." South Asian countries are the least
integrated in today's highly globalised world. Intra-regional trade is
less than 5 percent despite inking of South Asia Free Trade Agreements
(Safta) by eight nations Afghanistan, Bangladesh, Bhutan, India, th ze
Maldives, Nepal, Pakistan and Sri Lanka. Kuroda also dwelt on the ongoing
global recession and its impacts on Bangladesh, governance and corruption
issues. Also, the recovery trends he focused. "Bangladesh is not so much
affected compared to East Asian nations because it is not so globalised,"
said the ADB chief. He however said a second round effect is already felt
by Bangladesh with a decline in export growth. Kuroda felt that the
country's exports would not fall like what has happened with electronics
and automobiles. He hoped Bangladesh's economic growth would be 5 to 6
percent this year despite crisis. "If the recovery does not take place in
the second half, then it poses challenges for Bangladesh," he predicted.
On the recovery trend, he said Asian giants like China and India are
already showing recovery. Emerging Asian economies also indicate positive
trend. "But G7 economies are still contracting," he said. Kuroda said ADB
is ready to assist the smaller economies that need emergency assistance to
face recession. The ADB has already announced that it would increase its
annual average assistance to Bangladesh from $600 million to $800 million
for the next three years. Meanwhile, Bangladesh's finance minister has
sought additional $500 million this year to face the recession fallout.
The Manila-based multilateral lending agency has formed a $3 billion
counter-cyclical Support Facility, to face the immediate adverse crisis
fallout and help sustain long-term economic growth. But the ADB has
increased interest rate by 200 basis points for the facility, which the
ADB president legitimated saying it is an emergency support. "The interest
rate is still lower than many development lending agencies, including the
IMF," he added. On Bangladesh's anti corruption measures, Kuroda said he
assumed the present government would continue to strengthen governance and
reduce corruption.
