The State Bank of Pakistan (SBP) has received $1billion — $500 million each from World Bank (WB) and Asian Development Bank (ADB) on Wednesday to facilitate the country during its fight against coronavirus.
Earlier this month, the ADB had approved a loan worth $500 million to Pakistan to help the country’s coronavirus health and economic response and “protect poor” citizens.
SBP has received USD 1 bn today with USD 500 mn each from ADB and WB.
— SBP (@StateBank_Pak) June 24, 2020
The development — part of the COVID-19 Active Response and Expenditure Support (CARES) Programme — comes following a meeting of the ADB’s Board of Directors in Philippines’ capital, Manila.
In its statement, the bank said the loan would help the Pakistani government “deliver social protection programs to the poor and vulnerable, expand health sector capabilities, and deliver a pro-poor fiscal stimulus to boost growth and create jobs as the country fights the novel coronavirus disease (COVID-19) pandemic”.
Loan to ‘help plug selected funding gaps’
In this regard, ADB President Masatsugu Asakawa had said, “The COVID-19 pandemic hit Pakistan at a critical point in its ongoing economic recovery program. We are fully committed to supporting Pakistan through this difficult period.
#ADBNEWS: COVID-19 hit Pakistan at a critical point in its ongoing economic recovery program. ADB’s loan will help deliver programs for the poor & vulnerable, strengthen the health sector, & deliver a pro-poor stimulus to boost growth & jobs.
— Asian Development Bank (@ADB_HQ) June 10, 2020
“This loan will help plug selected funding gaps as the government implements its counter cyclical development plan, including strengthening the country’s social safety net and health sector capacity,” it said.
ADB had noted that the coronavirus pandemic was forecast to hamper Pakistan’s economic growth, revenue collection, and employment. The country’s response to the outbreak of the respiratory illness was hindered owing to a low ration of healthcare workers to population and a lack of hospital beds.
Acquisition of additional ventilators
The ABD’s CARES programme would aid “various government initiatives, including cash assistance payments to three million daily wage workers, of whom approximately 23% are women, and cash grants to 7.5 million families under the Kifalat social protection program”, the statement added.
“The program will also help fund the acquisition of additional ventilators and COVID-19 protective kits for medical staff, including appropriately sized personal protective equipment for women.
“To prevent job losses, the loan will support young entrepreneurs, including at least 25% women, through the government’s youth entrepreneur scheme, Kamyab Jawan,” it noted further.
The $500-million loan, it explained, was funded via the COVID-19 pandemic response option (CPRO) — part of its $20-billion additional aid announced April 13 for developing nations’ response to coronavirus — under ADB’s Countercyclical Support Facility.
Unused resources of Pakistan Earthquake Fund
The financial body said its programme would facilitate parallel financing of $500 million each from the Asian Infrastructure Investment Bank and the World Bank’s Securing Human Investments to Foster Transformation (SHIFT) development policy credit programme.
Moreover, it said the loan would be used to purchase medical supplies and personal protective equipment (PPEs) for hospital staff and their training, purchase of emergency vehicles, and strengthening COVID-19 awareness among marginal communities with limited television or internet connectivity.
Earlier in April the ADB had reallocated $30 million from Pakistan’s National Disaster Risk Management Fund (NDRMF) Project and the NDRMF Board of Directors allocated an additional $20 million to procure medical equipment to strengthen hospitals and other medical facilities in the country.
It had also mobilised existing technical assistance — capacity building of Disaster Risk Management Institutions — to provide training for at least 5,000 doctors, nurses, and technical staff working on the front lines in intensive care facilities.
In March, the lender approved $2.5 million in immediate response grant funding to help Pakistan purchase emergency medical supplies, PPEs, diagnostic and laboratory supplies, and other equipment. It had comprised $2 million from the bank’s Asia Pacific Disaster Response Fund and $500,000 for procurement of supplies through the United Nations Children’s Fund (UNICEF).