loan is usually a sort of debts. Like all of credit debt musical instruments, a loan entails the particular redistribution with economic resources as time passes, relating to the bank as well as debtor.
Bridging finance
While transportation projects are some of the most important investments a city can make they’re also some of the most expensive.
That’s why the Asian Development Bank announced at Rio+20, the United Nations conference on sustainable development, last week that they will join with seven of the world’s largest multilateral development banks to provide loans and grants totaling $175 billion over the next 10 years for urban transportation projects in developing countries.
“Rapid motorization is creating more congestion, air pollution, traffic accidents and greenhouse gas emissions – especially in developing countries,” said ADB President Haruhiko Kuroda at a news conference in Rio de Janeiro, the site of the Rio+20 conference. “Developing countries have the opportunity to leapfrog to a greener future of less motorization, shorter commutes, and more energy efficient transport systems.”
As ADB points out in a news release, transportation is a key issue not only for the environment but also for the economy. By 2030 transportation-related CO2 emissions are expected to account for 50 percent of the global total. While transportation — especially from vehicles — emits large amounts of CO2, traffic congestion is also holding back national economies. Economic loses from traffic congestion total 5 percent of GDP in some Asian countries.
Andrew Revkin at The New York Times called the announcement “one of the most important developments at Rio+20.” Here’s why:
[T]hese loans typically leverage 10 or 20 times more public and private investment, meaning this initiative could shift trillions of dollars from conventional road-building projects to more sustainable transportation alternatives.
ADB has already invested in urban metrorail systems in Vietnam, bus rapid transit systems in Mongolia and Bangladesh, low-cost electric vehicles in the Philippines, and inland waterway transport in the People’s Republic of China.
Here’s a helpful infographic from ADB showing the efficiency of different modes of transportation:
Photo: Flickr/Jonas Hansel
