Japan to provide $40 million to ADB to back high-level technology

Japanese Deputy Prime Minister and Finance Minister Taro Aso attends at opening session of the ADB annual meeting in Yokohama, south of Tokyo, Japan May 6, 2017. REUTERS/Issei Kato

YOKOHAMA, Japan (Reuters) - Japan will provide $40 million to the Asian Development Bank to promote high-level technology as part of efforts to boost quality infrastructure in Asia, Finance Minister Taro Aso said on Saturday.

“Japan has been promoting quality infrastructure in Asia in close collaboration with the bank,” Aso told the ADB’s annual gathering in Yokohama. “Enhancing quality of infrastructure in terms of lifecycle cost and environmental and social considerations is important.”

The money will be provided over a two-year period to a newly created fund of the ADB, he said.

Aso’s remarks came as China’s increasing presence in infrastructure finance has alarmed some Japanese policymakers, who worry that Beijing-led Asian Infrastructure Investment Bank (AIIB) may overshadow the Japan-U.S.-led ADB.

The AIIB is viewed by some as a challenger to both the Western-dominated World Bank and the ADB, which is primarily funded by Japan and the United States.

Partly to differentiate itself, the ADB has broadened its activities beyond infrastructure such as financing of steps for poverty reduction, healthcare and education.

ADB President Takehiko Nakao told the annual gathering that investment in infrastructure would remain a priority.

“Asia will need $1.7 trillion per year in investments in power, transport, telecommunications and water through 2030,” he said on Saturday.

On Thursday, Nakao said the ADB would cooperate with China’s development finance and infrastructure plans under its “One Belt, One Road” initiative, shrugging off the view Japan and China are competing for influence through development finance.

Reporting by Tetsushi Kajimoto; Editing by Nick Macfie