World Bank approves another loan package for the Philippines
US$500 million loan approved for Philippines’ COVID-19 response
MANILA – Another loan from the World Bank amounting to US%500 million has been approved by the Board of Executive Directors of Washington-based World Bank yesterday to assist the Philippine government’s response to the COVID-19 pandemic’s impact on the poor and vulnerable households as well as provide financial assistance to small and medium enterprises.
Finance Secretary Carlos G. Dominguez III said he’s thankful to World Bank for the “prompt action” as it passed the loan to provide immediate relief to poor and low-income Filipinos and small workers who lost their income due to the lockdown implemented by the government.
“This swift loan approval underlines the strong international confidence in the government’s capability to meet the massive financial requirements of containing this global health emergency,” he further said.
The financial assistance is known as Philippines Emergency COVID-19 Response Development Policy Loan will support the country’s efforts to province social assistance to 18 million poor and vulnerable Filipinos badly affected by CPVID-19, including additional subsidies in the monthly cash transfers given to 4.3 million beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps), expansion of social assistance to 1.36 million affected households that are not part of the program, and support for repatriated overseas Filipino workers.
The fresh funding will support the government’s efforts to alleviate the financial burden of small and medium enterprises through a two-month wage subsidy, additional financial relief through deferrals of tax and social security payments, as well as a credit guarantee scheme to help ensure continuity of their business operations and the preservation of people’s jobs.
“The COVID-19 pandemic has badly hurt millions of poor ad vulnerable Filipino families, particularly daily wage earners,” said Anchim Fock, World Bank Acting country Director for Brunei, Malaysia, Philippines and Thailand. He added the new financing can help with the delivery of financial support for struggling families and communities.
The lockdown which included travel restrictions and quarantines the government imposed severely affected small firms and their workers specially in tourism, transport, agriculture, retail and construction. In a rapid survey the government made, it was found 77 percent of micro and small firms while 62 percent of medium-sized firms had to close due to enhanced community quarantines. However, those who remained open experienced a 66.5 percent drop in sales. Government assistance to these firms will prevent them from closing permanently and in the process save millions of jobs as the economic begins to recover.
Last April 9, the World Bank’s Board approved a Third Disaster Risk Management Development Policy Loan of US$500 million to enhance the country’s disaster preparedness policies, planning, and investments for public health emergencies at the national and local government levels. The financing is expected to support urgent needs from the COVID-19 crisis.
On April 23,2020, the World Bank approved a US$100 million loan for the Philippines COVID-19 Emergency Response Project to help meet the health requirement needs due to the pandemic and improve the country’s public health preparedness. (Melo M. Acuña)