ADB urges more private funds to poor countries

The Asian Development Bank (ADB) urged the private sector yesterday to spread out their investments in developing countries.

Private sector investment flows to developing countries jumped dramatically to $300 billion in recent years from $25 billion in the early 1980’s, the Manila-based bank said.

"But over 80 percent of such funds goes to only 12 countries, including five in Asia," Christine Wallich, head of the private sector group in ADB, told a regional conference on poverty organized by the bank.

"The challenge is to catalyze more funds to other developing countries," she said. "The private sector can make a profit and help the poor at the same time."

She identified the 12 countries as China, Thailand, Malaysia, India and South Korea as well as Brazil, Mexico, Argentina, Poland, Chile and Venezuela.

Wallich said that by promoting growth and markets, the private sector could generate jobs for the poor, create "fiscal space" by relieving pressure on public budgets, forge partnerships with governments and share privatization revenues with the people.

The ADB approved a private sector development strategy last year to generate business opportunities and expand private investments, particularly in infrastructure and finance.