| World Bank IMF and Dev Agencies |    1198 VIEWS  |
| World Bank IMF and Dev Agencies | |
| 1198 VIEWS | |
 |
Wednesday,
March 18, 2020 /10:29 AM / By World Bank Group /
Header Image Credit: World Bank
Focus on private sector
and workers spearheaded by IFC to mitigate financial and economic impact of
crisis
The World Bank and IFC's Boards of Directors approved
today an increased $14 billion package of fast-track financing to assist
companies and countries in their efforts to prevent, detect and respond to the
rapid spread of COVID-19. The package will strengthen national systems for
public health preparedness, including for disease containment, diagnosis, and
treatment, and support the private sector.
IFC, a member of the World Bank Group, will increase
its COVID-19 related financing availability to $8 billion as part of the $14 billion
package, up from an earlier $6 billion, to support private companies and their
employees hurt by the economic downturn caused by the spread of COVID-19.
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. 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's 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," said David
Malpass, president of the World Bank Group. "The World Bank Group is committed
to a fast, 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."
The additional $2 billion builds on the announcement
of the original response package on March 3, which included $6 billion in
financing by the World Bank to strengthen health systems and disease
surveillance and $6 billion by IFC to help provide a lifeline for micro, small
and medium sized enterprises, which are more vulnerable to economic shocks.
Related Link: World
Bank Group Announces Up to $12bn Immediate Support for COVID-19 Country
Response
"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," said Philippe Le Houerou,
Chief Executive Officer of IFC. "In turn, this will help vulnerable groups to
more quickly recover their livelihoods and continue to invest in the future."
Having mobilized quickly at the time of the 2008
global financial crisis and the Western African Ebola virus epidemic, IFC has a
successful track record of implementing response initiatives to address global
and regional crises hampering private-sector activity and economic growth in
developing countries.
The IFC response has four components:
IFC is already working to deploy its response
financing. For example, we recently expanded trade-financing limits for four
banks in Vietnam by $294 million so they could continue lending to companies in
need, especially small and medium-sized enterprises.
IFC will maintain its high standards of
accountability, while bearing in mind the need to provide support for companies
as quickly as possible. IFC management will approve projects based on credit,
environmental and social governance and compliance criteria, as applied in past
crisis responses.
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