Fixing the Fatal Funding Gap Fueling Asia’s Road Safety Crisis

Tashkent, Uzbekistan (UzDaily.com) — Asia and the Pacific is dangerously off track in its efforts to make roads safer. Across the region, road crashes kill about 2,000 people a day, nearly 60% of the global toll, draining up to 8% of national GDP in some countries and hitting young people and vulnerable travelers the hardest.

To address the carnage on the region’s roads, we need a "safe systems" approach that accounts for human error through more forgiving road design, safer vehicles, safer drivers, managed speeds, and efficient post-crash care. But these interventions cost money, and the money isn't allocated there. 

Less than half the countries in Asia have identified funds to implement their national road safety strategies. The system is failing to deliver because it is underfunded. The question has always been why. 

Traditional funding mechanisms are failing.  At the start of the decade, the annual requirement for road safety in Asia and the Pacific was estimated at $57 billion. Now, the annual investment needed is estimated at $75 billion. A huge number, but just a mere fraction of the $1.5 trillion lost each year. Road safety makes perfect economic sense. 

The core of the problem has always been a split incentive. A classic market failure.

The societal burden of road crashes—in healthcare, disability support, lost productivity, and human suffering—are not borne by the entities that design, build, finance, and profit from road infrastructure. The costs are concentrated, but the benefits are dispersed across the economy. 

Insurance companies pay fewer claims. Hospitals treat fewer trauma patients. Commercial fleets experience fewer losses of vehicles and drivers. Society as a whole avoids the loss of a productive citizen. The builder has little financial reason to invest beyond what is enforced. Safety is engineered out. This disconnect between who pays and who decides creates a vicious cycle of underinvestment. 

That failure is now a strategic opportunity.

The next five years will determine whether we find a path to road safety or that goal is a forgotten promise. 

The path forward requires a financial commitment from governments and the private sector. National governments must play a central role, prioritizing safety investments in transport, health, and law enforcement. But they cannot do it alone. They need partners who can bring capital and innovation to the table. They need a new financial toolbox. Here are the starting points for “trillion-dollar opportunity” conversations.

Ring-fence government road safety funding. Current road safety funding streams are often opaque. The numbers are buried within the vast budgets of transport, health, justice, and other ministries. General tax revenues, the default source in many countries, lack the accountability and transparency that a crisis of this scale demands. 

Further, revenues from excise duties on fossil fuels, a bedrock of transport sector financing, are set to erode in the future. The global energy transition is accelerating. We need more direct, transparent mechanisms. 

Dedicated road safety funds are needed. They collate diverse revenue streams like fuel excise, parking fees, traffic fines, truck weight taxes, toll charges, vehicle registration charges, and levies on private sector-operated insurance. To achieve the best results, road safety funding needs to be made predictable; we must tie all road safety spending directly to specific targets and track performance relentlessly.

Use development banks as a catalyst. Between 2018 and 2024, multilateral development banks mobilized over $6 billion for road safety in low- and middle-income countries. There is a chance that this funding could reach $10 billion over the next decade. To leverage and optimize, the focus must shift to standalone, results-based programs where these institutions partner with governments to drive substantial, targeted investment. This financing should be the catalyst for change.

Make safety profitable. A new toolbox of financial instruments is needed to translate the social and economic returns of road safety into a language that private investors can understand and decide upon. This involves moving beyond traditional models. We need frameworks that align financial incentives with life-saving outcomes. We can start by embedding road safety ratings and fatality reduction targets as key performance indicators in public private partnership contracts. These projects should also include road safety-related performance-based contracts.

Reform project appraisal models. Traditional Cost-Benefit Analysis has historically prioritized benefits that are easy to quantify in vehicle-centric terms, such as travel time or fuel savings. The massive cost to the society (medical expenses, lost productivity, and human suffering from crashes) is often discounted. This creates a distorted picture.  We need different accounting. 

Identify quick wins. Even with the capital in hand, we can’t do everything at once. The crisis demands immediate and high-impact actions. We need some quick wins: proven, cost-effective measures that can be deployed across the region to save lives. It is about scaling what already works, everywhere. The immediate task for leaders is to define and commit to this priority list. 

We have a clear opportunity. Governments, development institutions, and private sector partners close the road safety funding gap by working together. By building financial systems that reward life-saving outcomes, Asia can turn a shared failure into a life-saving collective success on its

Priti Gautam, James Leather, Sudhir Gotaroads.

The views expressed are those of the author and do not necessarily reflect the views of the Asian Development Bank, its management, its Board of Directors, or its members, or UzDaily.