Civil society groups worldwide, including the Sri Lanka’s Centre for Environmental Justice, yesterday criticized the new strategic framework of the Asian Development Bank, saying it is moving towards private sector-led development, which is anti-poor and vulnerable to corruption.

The strategic framework suggests expanding the Bank’s activities with the private sector to boost market-led economic growth in Asia and the Pacific region. This will result in a more ‘business-friendly’ environment and could suggest disabling what’s perceived as a corrupt public sector in favour of a less accountable private sector.

Hemantha Withanage, Executive Director of the NGO Forum on the ADB told The Island the ADB will increase its support to the private sector by 50 per cent in 2020. It is now only about 12 per cent of its total operation. Basic needs such as health, education, water and other infrastructure sectors – now largely being privatized – will gradually be increased to only 20 per cent.

He added: "It’s a shame that the ADB is targeting poverty alleviation through its corporate friends but not through legitimate governments."

He said that they believe that poverty remains the central challenge facing Asia and the Pacific region. Likewise, rapid economic growth is putting severe strains on the environment. However, increasing the private sector’s leverage in development projects would be dangerous due to their profit-oriented activities and strong disregard of the existing Bank’s policies safeguarding local communities and the environment from disastrous impacts.

"The private sector does not respect social and environmental safeguards of local communities. They are only interested about making profits. Corruption goes side-by-side with private sector operations," Withanage said.

According to the ADB, private sector is the engine of growth. However, Asian communities still believe that growth could still be best led by the public sector. In many occasions, citizens have opposed private sector development projects due to corruption and violations of human rights. Recently, villagers from the Pulbari village in Bangladesh staged a mass action against a proposed loan by the ADB for a coal power project. The protest has forced the Bank to pull out from the project.

"ADB seems to miss out on a costly lesson that the most recent troubles of the global economy (as in the 1997 Asian crisis) were triggered and caused by the private sector aided by negligent governments," Gani Serrano of PRRM, a founding member of the NGO Forum on ADB states. He adds, "In any case, the private corporations can very well take care of themselves, its Asia’s poor millions that need ADB’s undivided attention."