Washington: The World Bank has announced increasing to USD14 billion the amount of fast-track financing to assist companies and countries in their efforts to respond to the rapid spread of COVID-19, adding USD2 billion to the initial package.
The announcement came amid fear of a major global recession in the wake of the coronavirus that has impacted more than 120 countries. The package will strengthen national systems for public health preparedness, including for disease containment, diagnosis and treatment, and support the private sector, the bank said in a statement on Tuesday.
"It is essential that we shorten the time to recovery. This package provides urgent support to businesses and their workers to reduce the financial and economic impact of the spread of COVID-19," David Malpass, President of the World Bank, said.
The World Bank Group is committed to a fast and flexible response based on the needs of developing countries. Support operations are already underway and the expanded funding tools approved today will help sustain economies, companies and jobs, he said.
The International Finance Corporation (IFC), a member of the World Bank Group, will increase its COVID-19-related financing availability to USD8 billion as part of the USD14 billion package, up from an earlier USD6 billion.
The bulk of the IFC financing will go to client financial institutions to enable them to continue to offer trade financing, working-capital support and medium-term financing to private companies struggling with disruptions in supply chains, the statement said.
IFC's response will also help existing clients in economic sectors directly affected by the pandemic — such as tourism and manufacturing — to continue to pay their bills. The package will also benefit sectors involved in responding to the pandemic, including healthcare and related industries, which face increased demand for services, medical equipment and pharmaceuticals, it added.
"Not only is this pandemic costing lives, but its impact on economies and living standards will likely outlive the health emergency phase. By ensuring our clients sustain their operations during this time, we hope the private sector in the developing world will be better equipped to help economies recover more quickly," IFC CEO Philippe Le Houérou said.