The World Bank and the International Finance Committee (IFC) approved a $14 billion financing package to assist companies and countries in their efforts to respond to the spread of COVID-19.
About $8 billion of that is from IFC, which is a member of the World Bank Group. It will increase its COVID-19 related financing availability to $8 billion from a previously announced $6 billion. The funding will be used to support private companies and their employees hurt by the spread of COVID-19. Specifically, most of the IFC financing will go to financial institutions to help them to continue to offer trade financing, working-capital support, and medium-term financing to private companies struggling with disruptions in supply chains.
The funding will also go toward its member companies in economic sectors directly affected by the pandemic–such as tourism and manufacturing—to help them pay their bills. Further, it is also targeted at companies responding to the pandemic, including those in the healthcare sector.
“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,” David Malpass, president of the World Bank Group, said. “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.”
IFC has a successful track record of implementing response initiatives to address global and regional crises, responding quickly to the 2008 global financial crisis and the Western African Ebola virus epidemic.
“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. “In turn, this will help vulnerable groups to more quickly recover their livelihoods and continue to invest in the future.”
IFC is the largest global development institution focused on the private sector in emerging markets. It works with more than 2,000 businesses worldwide, using its capital, expertise, and influence to create markets and opportunities where they are needed most.