Lack of infrastructure investment holding back AsiaPacific region – UN meeting

22 March 2007The long-term development of the Asia-Pacific region is being threatened by a lack of investment in infrastructure, according to a United Nations-sponsored meeting which ended today with a call to back a proposal to set up a new regional body to raise funds. Kim Hak-Su, Under-Secretary-General and Executive Secretary of the UN Economic and Social Commission for Asia and the Pacific (UNESCAP), described the meeting as “a crucial step” in finding the path forward to generating investment in infrastructure.“The region needs to find a way to utilize our large amount of savings and foreign exchange reserves,” he said after the two-day meeting in New Delhi, which attracted about 100 representatives of government, academia and the private sector from 20 countries.Welcoming India’s championing of the need for a regional solution, Mr. Kim noted that a series of recent studies indicate there is a shortfall of more than $200 billion every year in investment in transport, energy, water and telecommunications.Yet the Asia-Pacific region has foreign exchange reserves of about $3 trillion, with much of it invested outside the region.The meeting, which was jointly organized by UNESCAP and an Indian think-tank known as RIS, endorsed a proposal to examine the establishment of a regional intermediary to channel the savings into investment.This new mechanism could be an infrastructure investment bank or finance corporation in Asia, and it could either be independent or an affiliate of an existing financial institution in the region, such as the Asian Development Bank.The meeting also ended with a call for UNESCAP’s members to set up a high-level working group to consider all options and issue recommendations to the region’s governments. read more