ASEAN to create anti-poverty fund

The Association of Southeast Asian Nation (ASEAN) is considering the possibility of creating an ASEAN Anti Poverty Fund (APF), which was originally sponsored by the Philippines during the recent meeting of ASEAN financial ministers in Manila.

Finance Secretary Jose Isidro Camacho said the proposal made by the Philippine delegation was discussed only superficially during the ASEAN Finance Ministers Meeting (AFMM) but it would be taken up again in late September.

According to Camacho, the Philippines was asked to organize a meeting between ASEAN leaders when the International Monetary Fund (IMF) meets in Dubai next month, specifically to discuss this proposal.

"By then we expect more concrete feedback from the ASEAN leaders and hopefully we will be able to come up with something more concrete," Camacho said.

The proposal, according to Camacho, was to form the fund from contributions from ASEAN members as well as multilateral and bilateral funding agencies. These funds would then be lent to microfinance enterprises as part of a comprehensive anti-poverty program of the ASEAN.

Camacho said the original proposal was for ASEAN members to contribute $10 million over a period of five years. Multilateral and bilateral funding agencies, on the other hand, would be requested to contribute at least 2.5 times the amount contributed by ASEAN members.

Camacho said a fund manager will likely be created to manage the proposed fund and the loans would be concessional but borrowers would be required to repay. "Its not a dole-out, there will be repayment,"Camacho said.

Camacho said the ASEAN initially entertained the idea of creating an anti-poverty bank but he said the proposal was eventually dropped because of concerns that it would overlap with the functions of such agencies as the Asian Development Bank and the World Bank.