The World Bank In East Asia Pacific

East Asia and Pacific is one of the world’s most disaster prone and heavily impacted regions by climate change. The World Bank is supporting innovative, impactful, scalable projects and initiatives to build resilience, reduce emissions, and protect biodiversity, and natural resources.

Overview

The East Asia and Pacific region remains one of the fastest growing and most dynamic regions in the world. Over the past two decades, most countries in the region have achieved strong and stable growth that has lifted hundreds of millions of people out of poverty and transformed economies across the region. Many East Asia and Pacific countries have risen to upper-middle income status and have set the goal of reaching high-income status in the near to medium term.

Because of their growing economies, vast population, and carbon intensity, EAP countries are critical to addressing global challenges such as climate change, biodiversity, air pollution, and pandemics. EAP is likely to remain an engine of global growth and clients have increasing expectations of collaboration and support from multilateral development banks.

Developing East Asia and Pacific is growing faster than the rest of the world but more slowly than before the pandemic. While recovering global trade and easing financial conditions are expected to support economies in the region, increasing debt, protectionism and policy uncertainty could dampen growth. Regional growth is projected to ease to 4.5 percent in 2024 from 5.1 percent last year. Growth in developing East Asia and Pacific excluding China is projected to pick up to 4.6 percent this year from 4.4 percent in 2023. Growth in China is projected to moderate to 4.5 percent this year from 5.2 percent in 2023, because of near term problems, such as high debt and a weak property sector, as well as longer-term challenges, such as aging and trade frictions. Growth among Pacific Island countries is forecast to decline to 3.6 percent in 2024 from 5.6 percent last year, as the post-pandemic rebound dissipates.

Overall, 7 million people in the region were expected to escape poverty between 2022 and 2023 at the lower-middle income poverty line (US$3.65/day, 2017 at purchasing power parity (PPP)), whereas 37 million people were projected to escape poverty at the upper-middle income poverty line (US$6.85/ day, 2017 PPP).

Despite significant progress, developing EAP faces challenges. Rapid urbanization and business demands are feeding a massive need for investment in infrastructure, broadband access, adequate sanitation, and reduction and management of marine plastic pollution. Unleashing competition is critical to increase firm productivity. With aging, rising chronic diseases, and increasing health expenditure, the demand for health care is shifting in favor of comprehensive health care encompassing prevention, and to treatment and continuous care at affordable costs. Meeting growing electricity needs at a reasonable price and without massively increasing the greenhouse gas footprint of the region is also a major challenge.

Reducing exposure to climate risks is critical for a region that includes 13 of the world’s 30 most climate-vulnerable countries. East Asia and Pacific also bears the brunt of 70% of the world’s natural disasters, which have affected more than 1.6 billion people in the region since 2000. Pacific Island countries, where rising sea levels are threatening coastal areas and atoll islands, have been hit hard by natural disasters.

With co-located offices in majority of countries, EAP is working towards building a stronger One World Bank group presence by piloting joint representation of IBRD/IDA, IFC, and MIGA in four countries. Our program has evolved to support economic development that embeds solutions to climate change, reforms to create opportunities for the private sector, and responses to crises like the COVID-19 pandemic.

Last Updated: April 2024

Strategy

The Bank approved $7.5 billion for 28 operations in the region in fiscal 2023, including $6.6 billion in IBRD commitments and $877 million in IDA commitments. We also signed six Reimbursable Advisory Services agreements with two countries for a total of $3.5 million.

With countries in the region facing the challenges of deglobalization, aging, and climate change, our work focuses on four main areas: promoting economic recovery for long-term growth, building human capital and strengthening pandemic preparedness, mobilizing climate finance, and building resilience and sustainability. The World Bank remains engaged in Myanmar, aligned with the World Bank Group Strategy for Fragility, Conflict, and Violence. We are monitoring and assessing the situation on the ground and assisting the most vulnerable people through a multi-donor trust fund. We continue to deepen our partnerships with non-borrowing member countries, including Korea, Malaysia, and Singapore, allowing us to exchange development lessons and solutions for shared priorities.

Promoting economic recovery for long-term growth

We help countries expand private sector opportunities and enable investment and innovation to promote sustainable growth. In the Philippines, the Bank is supporting a program to strengthen financial sector stability, expand financial inclusion, and bolster sustainable financing for mitigating climate and disaster risk. It supports reforms to boost job creation, human capital, and resilience to conflict and natural disasters. In Cambodia, we are supporting efforts to expand growth through a more competitive private sector environment and to strengthen the country’s fiscal, social, and environmental resilience. This will help enhance the financial sector and foster private enterprises while strengthening public sector accountability and finance. We are also promoting digitalization to improve public services, increase productivity, and expand access and inclusion, including in Kiribati, Lao People’s Democratic Republic, the Republic of the Marshall Islands, and Mongolia.

Building human capital and strengthening future pandemic preparedness

Investing in human capital is key to ensuring long-term sustainable growth and reducing poverty. In Indonesia, we are supporting a successful children’s health initiative to improve nutrition and prevent stunting. In the Philippines, we are working to address the persistence of high levels of childhood undernutrition and reverse the trends that could seriously damage the country’s human and economic potential. In Timor-Leste, we are helping the government better prepare for, prevent, respond to, and mitigate the impact of epidemics; while in Tuvalu, we are supporting efforts to improve health service delivery, strengthen health management systems, and respond promptly and effectively to crises or emergencies. We are helping Lao PDR improve child health, nutrition, and food security through social assistance and livelihood options, better child care, and access to health services and clean water. We are also working with the government to address the learning lost during the pandemic. In Papua New Guinea, we are supporting efforts to scale up a community-based approach to delivering nutrition services and improving families’ nutrition knowledge and practices.

Mobilizing climate finance for resilient growth

Through the World Bank’s Country Climate and Development Reports, we offer concrete, evidence-based proposals for countries to address climate change without sacrificing their development goals. The report for China analyzed the fundamental changes in energy, industry, transport, cities, and land use that could help realize national commitments to reach peak carbon emissions before 2030 and achieve carbon neutrality by 2060. Even though climate change is already exacting a heavy toll on the Philippines, the country has many of the tools required to reduce damages substantially, according to the report for the country. And in Vietnam, the report suggested that with the right mix of policies and strategies, decarbonization efforts could help ensure that the country can meet growth and development goals while achieving net zero emissions.

Building resilience and sustainability

East Asia and Pacific is highly vulnerable to the effects of climate change. We work with countries to strengthen resilience, reduce pollution and emissions, support climate-smart agriculture, and transition to clean and renewable energy. This includes island countries in the Pacific, which are particularly vulnerable to climate change and natural disasters as well as economic shocks—such as the severe contraction of tourism during the COVID-19 pandemic—due to their geography, remoteness, and limited economic opportunities.

In response to these challenges, we have rapidly expanded our program in the Pacific. This includes in Papua New Guinea, where the roads are vulnerable to natural disasters and climate change, and some three-quarters of them become impassable at some point during the year. We are helping improve the climate-resilience and sustainability of the country’s road network to diversify the economy, decentralize service delivery, and promote social inclusion. In Indonesia, we are helping mitigate climate change impacts through the Mangroves for Coastal Resilience and Oceans for Prosperity projects.

Last Updated: April 2024

People

World Bank support in East Asia and Pacific has delivered human capital, health and education and social benefits. For example:

World Bank support put East Asia and Pacific on a path to recovery from the COVID-19 Crisis. The World Bank mounted a swift and wide-ranging response, from emergency operations, approved under the COVID-19 fast-track facility for the purchase of medical and laboratory supplies, to training of medical staff, and strengthening national public health systems. The World Bank also worked with countries to redeploy existing project resources by reallocating funds, triggering emergency components of existing projects, and activating Catastrophe Deferred Drawdown Options.

In Viet Nam, private capital brought clean drinking water to schools and communities. Thanks to an Emission Reduction-Linked Bond issued by the World Bank, a Vietnamese company manufactured and distributed 300,000 easy-to-use water purifiers to 8,000 schools and other community institutions across the country for free, which will provide clean drinking water to up to 2 million children. The project is expected to reduce carbon dioxide (CO2) emissions by about 6 million tons in the decade following its initiation.

In Cambodia, with World Bank support, reforms improved education quality for half a million students. Students benefited from improvements to school operations, learning facilities, and teacher capacity. The project also formed the backbone of the country’s distance teaching and learning program or efforts during the school closures caused by the pandemic.

In Indonesia, the Investing in Nutrition and Early Years (INEY) Program informed and supported the National Strategy to Accelerate Stunting Prevention, which reduced the national stunting rate by 6.4 percentage points in its three years of implementation since 2018. This achievement involved collaboration among a range of ministries and government institutions, development partners, civil society, academia, professional organizations, and the private sector – all working together to bring nutrition services to millions of pregnant women and children under two across the country.

Prosperity

To boost shared prosperity in the region, World Bank support delivered jobs, domestic resource mobilization, financial inclusion, and economic policies. For example:

In the Pacific, the World Bank supported the improvement of ocean-based livelihoods. The Pacific Islands Regional Oceanscape Program helped the regional the regional body responsible for tuna fisheries management – the Pacific Islands Forum Fisheries Agency to provide training for regional fisheries observers, helping improve their safety, and building a better shoreside inspection regime.

In the Philippines, World Bank support helped reducing poverty and increase productivity and incomes among rural farmers and fisherfolk. The project provided about 372,000 farmers and fisherfolk with agricultural assets and services, 46 percent of whom were female. This support helped increase the average real household income of farming and fishing households by 36 percent and increased the value of their marketed output by 51 percent.

In Mongolia, World Bank support brought herders closer to markets and livestock services. Investments to improve livestock productivity and quality and boost market access helped reduce rural poverty and household food insecurity on a sustainable basis in Mongolia. Almost 14,000 people benefitted from the project, 40 percent of whom were female.

Planet

The World Bank supported efforts to mitigate and adapt to climate change, eliminate food insecurity, water, support forestry, and prevent biodiversity loss and soil degradation in the region. For example:

In Vietnam, the World Bank helped increase the low-carbon energy supply for people and businesses. The project enhanced capacity, increased efficiency, and reduced greenhouse gas emissions, while ensuring improved access to more reliable electricity services. The project increased transmission capacity by 15 percent and enhanced the efficiency and reliability of electricity transmission in the Greater Hanoi and Greater Ho Chi Minh City areas.

The World Bank supported Thailand’s climate goals through the a partnership for market readiness. The program supported Thailand to design and to deploy new carbon pricing instruments to effectively reduce the country’s greenhouse gas emissions. With the program’s backing, Thailand developed an Energy Performance Certificate database and a measuring, reporting and verification system to monitor the energy efficiency of commercial buildings and industries, to assess the legal framework for the Emissions Trading Scheme, and to develop greenhouse gas abatement plans for 25 municipalities.

In Solomon Islands, World Bank support helped rural communities build resilience to climate change. the Community Resilience to Climate and Disaster Risk in Solomon Islands Project supported the Solomon Islands government to deliver multi-hazard early warning systems and community infrastructure assistance. Projects provided better access to safe drinking water, created multi-purpose resilient buildings, improved footbridges and increased shoreline protection, benefitting almost 70,000 people.

Infrastructure

The World Bank helps developing countries build smart infrastructure that supports inclusive and sustainable growth, expands markets, creates job opportunities, promotes competition, and contributes to a cleaner future. Some examples in East Asia and Pacific:

In Indonesia, the National Slum Upgrading Project provided better public services to 8.6 million people. The NSUP rehabilitated tens of thousands of houses, thousands of kilometers roads, and bridges, drainage systems, and solid waste facilities. The project improved fire protection facilities, public open spaces, water supply and sanitation including solid waste facilities. It has also created task forces among local governments to coordinate slum alleviation activities.

In China, a World Bank-supported urban rail line delivered low-carbon mobility in a Chinese city. The Zhengzhou Urban Rail Line 3 provided fast, high-quality, and well-integrated mobility services to more than 140,000 passengers daily. The project is estimated to have mitigated 33,960 tons of CO2 emissions a year.

In the Philippines the World Bank-supported Global Infrastructure Facility piloted a public-private financing model for airport expansion and modernization. Under the project, upgrades to Clark International Airport quadrupled its capacity and reduced the strain off Ninoy Aquino International Airport, the country’s premiere gateway. The Global Infrastructure Facility provided funding to support IFC to conduct due diligence of the legal, technical, financial/commercial, and environmental and social issues of the project.

Digital

The World Bank provides knowledge and financing to help close the global digital divide, and make sure countries can take full advantage of the ongoing digital development revolution.

In Malaysia, a World Bank analysis digital connectivity, digital entrepreneurship, and taxation of digital platforms led to telecommunications regulatory reforms that have contributed to a 50 percent reduction in the costs of fixed broadband and the doubling of the doubling of speeds of internet connections.

The World Bank helped the Philippines harness digital technology. A study assesses the state of the digital economy in the Philippines, identifying the key challenges to digital adoption, and provided policy recommendations to improve the enabling environment. Recommendations led to streamlined guidance for the issuances of permits, licenses, and certificates for the construction of shared passive telecommunications towers, and ultimately, the issuance of certificates to 23 independent tower companies.

Last Updated: April 2024