By THE NATION
The package expands ADB’s initial package of $6.5 billion that was announced on March 18, adding $13.5 billion in resources to help ADB’s developing member countries to counter the severe macroeconomic and health impacts caused by the pandemic. The new package includes about $2.5 billion in concessional and grant resources.
ADB’s developing members include Afghanistan, Armenia, Azerbaijan, Bangladesh, Bhutan, Brunei, Cambodia, Cook Islands, Micronesia, Georgia, India, Indonesia, Fiji, Hong Kong, China, Kazakhstan, Kiribati, Kyrgyz Republic, Laos, Malaysia, Maldives, Marshall Islands, Mongolia, Myanmar, Nauru, Nepal, Niue, Pakistan, Palau, Papua New Guinea, Philippines, South Korea, Samoa, Singapore, Solomon Islands, Sri Lanka, Taiwan, Tajikistan, Thailand, Timor-Leste, Tonga, Turkmenistan, Tuvalu, Uzbekistan, Vanuatu and Vietnam.
“This pandemic threatens to severely set back economic, social, and development gains in Asia and the Pacific, reverse progress on poverty reduction, and throw economies into recession,” said ADB president Masatsugu Asakawa.
“Our expanded and comprehensive package of assistance, made possible with the strong support of our board, will be delivered more quickly, flexibly, and forcefully to the governments and the private sector in our developing member countries to help them address the urgent challenges in tackling the pandemic and economic downturn.”
ADB’s most recent assessment, released on April 3, estimates the global impact of the pandemic at between 2.3 per cent and 4.8 per cent of gross domestic product. Regional growth is forecast to decline from 5.2 per cent last year to 2.2 per cent in 2020.
The new package includes the establishment of a Covid-19 Pandemic Response Option under ADB’s Countercyclical Support Facility. Up to $13 billion will be provided through this new option to help governments of developing members implement effective countercyclical expenditure programmes to mitigate the impact of the pandemic, with a particular focus on the poor and the vulnerable. Grant resources will continue to be deployed quickly for providing medical and personal protective equipment and supplies from expanded procurement sources.
Some $2 billion of the $20 billion package will be made available for the private sector. Loans and guarantees will be provided to financial institutions to rejuvenate trade and supply chains. Enhanced microfinance loan, guaranteed support and a facility to help liquidity-starved small and medium-sized enterprises, including those run by women, will be implemented alongside direct financing of companies responding to, or impacted by, Covid-19.
The response package includes a number of adjustments to policies and business processes that will allow ADB to respond more rapidly and flexibly to the crisis. These include measures to streamline internal business processes, widen the eligibility and scope of various support facilities, and make the terms and conditions of lending more tailored.
All support under the expanded package will be provided in close collaboration with international organisations such as the International Monetary Fund, the World Bank, the World Health Organisation, Unicef and other UN agencies as well as the broader global community.
ADB was established in 1966 with 68 members, 49 of which are from the region. The bank’s aim is to achieve a prosperous, inclusive, resilient and sustainable Asia-Pacific, while sustaining its efforts to eradicate extreme poverty.