The Asian Development Bank (ADB) said multilateral development banks (MDBs) are coordinating efforts to help countries manage the economic fallout from the conflict in the Middle East through financing support, policy assistance, private-sector instruments, and technical expertise.

In a statement on Tuesday night, May 19, the Manila-based ADB said its president, Masato Kanda, told finance ministers and central bank governors of the Group of Seven (G7) in Paris, France, that MDBs are working together to protect vulnerable economies from the effects of the escalating conflict.

“Development setbacks are hard to reverse. Early, coordinated action can help countries contain the damage and protect hard-won gains,” Kanda said, speaking as MDBs heads group chair.

Kanda’s remarks followed the May 18 joint statement issued by seven MDBs, including the ADB, pledging support for countries and clients affected by the Middle East conflict.

In their earlier statement, the MDBs said they were “uniquely positioned” to help member-countries manage economic shocks, preserve development gains, and strengthen long-term resilience.

They added that their coordinated response aims to provide immediate relief for vulnerable populations, sustain essential services, and support the foundations of more resilient economies.

The ADB has already downgraded its growth outlook for developing Asia-Pacific while raising its inflation forecast due to the worsening economic impact of the conflict.

The lender said regional economic growth is expected to slow to 4.7 percent this year from 5.4 percent in 2025, while inflation is projected to accelerate to 5.2 percent from three percent last year.

Under a downside scenario involving a prolonged conflict, the ADB warned that regional growth could decelerate further to 4.2 percent while inflation could climb to 7.4 percent.

According to Kanda, the ADB is responding to the crisis through fast-disbursing budget support, countercyclical financing, trade and supply chain financing, and rapid additional financing alongside its regular operations.

The ADB chief said this support is intended to help economies stabilize, maintain essential services, and safeguard the availability of energy and agricultural inputs amid rising global uncertainties.

Kanda also told the G7 session on international partnerships that MDBs are intensifying coordination to mobilize private capital, reduce duplication, and improve efficiency in development financing.

He cited the full mutual reliance framework between the ADB and the World Bank as the first arrangement of its kind among MDBs, aimed at reducing transaction costs and streamlining project implementation for clients.