The Asian Development Bank (ADB) on Tuesday announced a financial support package to help its developing member countries mitigate the economic and financial impacts resulting from the conflict in the Middle East.
A press release issued by the lender quoted ADB President Masato Kanda as saying, “ADB will deliver rapid, flexible, and scalable assistance to help countries manage immediate pressures and strengthen long-term resilience, notably fast-disbursing budget support and trade and supply chain finance to secure the import of essential goods, now including oil.”
Kanda further said that this built on the ADB’s track record of supporting Asia and the Pacific through “periods of global uncertainty”.
ADB has ample resources to safeguard existing and planned operations, while expanding emergency support in line with developing member countries’ needs, including utilising its countercyclical lending buffer, the statement said.
It added that the bank was closely monitoring global market developments and their potential implications for economies across Asia and the Pacific, particularly regarding energy price volatility, inflationary pressures, and external account balances.
“The latest ADB analysis indicates that disruptions to shipping routes have already increased costs and delivery times, while supply risks extend beyond energy to key industrial inputs such as petrochemicals and fertilisers, with serious implications for agriculture and food production,” it said.
“Tourism and remittance dependent economies face compounding vulnerabilities beyond these initial shocks. Furthermore, the conflict is increasing uncertainty and tightening financial conditions across the region, putting pressure on currencies and capital flows,” it added.
The statement said the bank was ready to deploy timely financial and technical support to help developing member countries manage risks, maintain macroeconomic stability, and protect vulnerable populations.
“There are two main components to ADB’s intervention. The first is fast-disbursing budget support to help developing member countries facing heightened fiscal pressures, notably the use of the bank’s Countercyclical Support Facility to help governments stabilise their economies and mitigate the impact of shocks on the lives and livelihoods of those most at risk,” the statement said.
It added that the second was the ADB’s Trade and Supply Chain Finance Programme, which supported the private sector to ensure critical imports, including energy and food, continue to flow.
“The bank has decided to reactivate support for oil imports under the programme on an exceptional basis for this limited period. This decision acknowledges that economies and people across the region are being severely affected by the rapid surge in oil prices and supply chain disruptions,” it said.
The statement said the ADB had begun discussions with all severely affected developing member countries on possible immediate support and will continue to work closely with governments, development partners, and the private sector to ensure coordinated and effective responses to maintain economic stability and protect the poor and most vulnerable.
