ADB ignores U.S. objection to study on raising capital

CHIANG MAI (Thailand), MAY 8. The Asian Development Bank has, in the face of opposition from the United States, decided to initiate a study on the need, feasibility and modalities of raising additional general capital. Announcing this at a press conference, after the Bank's 33rd annual meeting of its Board of Governors, the ADB president, Mr. Tadao Chino, defended the decision on the ground that ``most'' of the 58 member-States supported the initiative for a study.

Additional resources were simply a sine qua non, given the bank's mandate, he explained without, going into specifics. The prospective study would encompass an overall review of the Bank's operations too, he hinted. The mix of concessional credit and normal lending, in a ratio of 1:4 as at present, was also a factor that was reckoned with in deciding upon a fresh evaluation of resource mobilisation.

``I think the U.S. opposed the move,'' Mr. Chino said and pointed out that it was also a ``legitimate statement,'' by some European Governors that the initiation of a study should not necessarily mean that they would approve a general capital increase in course of time.

About the demand for a reorganisation of the ADB's higher echelons, the president said it should be envisaged and carried out with ``utmost care''. On the issue of any selective eligibility criterion for the Bank's presidentship, he said that the elective post was open to Asian nationals under the ADB Charter.

Asked about the U.S. plea that the ADB should enter into a Memorandum of Understanding with the World Bank for a meaningful coordination, Mr. Chino maintained that the two were already on a track of ``very good collaboration'' in the context of an existing joint message on ways to strengthen their bilateral ties.

Mr. Chino spoke at length to dispel the impression that he had not been sufficiently sensitive to the sentiments of the protestors who had today laid ``siege'' to the main entrance of the conference venue for third successive day. He said that he had met representatives of registered non- governmental organisations in Chiang Mai ahead of the meeting. He did not, however, find time to meet the protestors mainly because the priorities of consultations with the Governors from each of the 58 member-States could not be cast aside. The ADB representatives had, however, met some of the demonstrators.