Coronavirus: WB to provide $100m loan to support Bangladesh

The World Bank (WB) will mobilise a $100 million loan to support Bangladesh in fighting coronavirus. The WB will allocate the financial package in response to an appeal from the health ministry, said the Economic Relations Division (ERD).   

"The WB funding, provided in response to the health ministry's appeal, is being processed. We hope the loan will be allocated soon," said ERD Additional Secretary (World Bank) Shahabuddin Patwary.

"The International Development Association, a World Bank Group member, will give Bangladesh the loan at two percent interest. However, the ERD is trying to get the amount as a grant," Shahabuddin told The Business Standard.

The payment deadline is 25 years – with a grace period of five years.

The World Bank recently made a package of $12 billion available – for immediate support to assist countries coping with the global outbreak of Covid-19, or coronavirus. The World Bank Group launched the fund to counter coronavirus' health and economic impacts as it races around the globe.

The World Health Organization, on March 11, declared the rapidly-spreading coronavirus outbreak a pandemic, acknowledging what has seemed clear for some time — the virus will likely spread to all countries of the globe.

The WB, in a statement, said it will help developing countries strengthen their health systems. This would include improving access to health services to safeguard people from the pandemic, strengthening disease surveillance and bolstering public health interventions.

Moreover, the WB said it will work with the private sector to reduce the virus' impacts on economies. In the meantime, the International Monetary Fund announced a $50 billion loan for assistance to virus-struck countries.

ERD officials said that the Asian Development Bank (ADB) also assured Bangladesh it will help with combating the virus. 

"The health ministry has reached us through the Economic Relations Division. We will help Bangladesh to fight the virus," ADB Country Director to Bangladesh Manmohan Parkash told the media on Sunday.

However, neither Parkash nor ERD officials specified the amount of ADB assistance saying the Manila headquarters of the bank will decide the volume. 

Bangladesh reported maiden coronavirus cases on March 8. Soon after the detection, the health ministry asked the government for a Tk100-crore fund to tackle coronavirus. The government, however, allocated Tk50 crore for health services to prevent the spread of the virus that first surfaced in China last December.

Health ministry officials said that they are also reaching out to development partners for coronavirus funds.          

According to the Institute of Epidemiology Disease Control and Research, a total of five Covid-19 cases have been detected till Sunday – while at least 2,314 people are in self-quarantine across the country.

The Asian Development Bank, in recently published analysis, said that if Covid-19 lingers for more than six months, Bangladesh will lose $3.021 billion – about 1.1 percent of the country's total economic output.

In the worst-case scenario, every 895 of a thousand people may lose their jobs, according to the ADB analysis.