MANILA, Philippines — The Asian Development Bank (ADB) has tripled the size of its response package to the COVID-19 pandemic to $20 billion and will streamline its operations to speed up the delivery of assistance.
The new package expands the $6.5 billion initial response announced last month with the addition of $13.5 billion in resources to help developing member countries address the macroeconomy and health impact of the pandemic.
Out of the total, $2.5 billion will be provided as concessional and grant resources.
The balance will be provided under the newly established COVID-19 Pandemic Response Option under ADB’s Countercyclical Support Facility.
As the name of the facility implies, this will support efforts by governments to implement countercyclical expenditure programs —increasing spending and cutting taxes during a recession—to mitigate the economic impact of the pandemic especially on the poor and vulnerable.
Some $2 billion, meanwhile, will be extended to the private sector to rejuvenate trade and supply chains. This will be channeled through financial institutions that can provide loans and guarantees for liquidity-starved businesses.
“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 estimates the global impact of the pandemic at between 2.3 percent and 4.8 percent of gross domestic product (GDP). Growth in Developing Asia, meanwhile, is expected to decline to 2.2 percent this year.
To speed up the provision of assistance, the bank will streamline internal business processes, widen the eligibility and scope of various support facilities, and tailor the terms and conditions of lending to the needs of borrowers.
The bank said all support under the expanded package would be provided in close collaboration with international organizations including the International Monetary Fund, World Bank Group, World Health Organization, UNICEF and other UN agencies.