MANILA, Philippines — The Asian Development Bank (ADB) has given the green light to the $1.5-billion quick-disbursing loan for the Philippines, its host-country, to aid in the fight against the COVID-19 disease.
“The ADB’s COVID-19 active response and expenditure support (Cares) program will support the government’s measures to help its citizens overcome the health, economic, and social costs of the pandemic by helping finance the country’s COVID-19 response programs. Government actions include increased funding for social protection, especially for women who are primary household and family caregivers; small business relief assistance; and wider health measures to stop the spread of COVID-19 in the country,” the Manila-based multilateral lender said in a statement Friday.
“The government’s COVID-19 relief package includes well-designed and targeted support to Filipino families, including a P205-billion ($4-billion) emergency subsidy program covering 18 million families engaged in the informal sector and a P51-billion small business wage subsidy to provide a lifeline for 3.4 million workers in the formal sector. These programs cover 85 percent of all Filipino families,” the ADB said.
“The Cares program will establish a country engagement framework focused on supporting policy dialogue with the government as it implements its fiscal response program and bounce back strategy. The ADB coordinated with other development partners in preparing the Cares program for the Philippines,” it added.
In a virtual press briefing, ADB country director for the Philippines Kelly Bird said that the Cares program will support the Philippines’ P655.6-billion ($12.8-billion) response program across five interventions against COVID-19, including scaling-up medical response, social assistance, small business relief program, support to agriculture and other economic sectors, and local government support.
Bird said that since the ADB’s financial assistance will go to the national budget, it will be up to the Philippine government to choose in which specific programs and projects the money will be spent.
“This assistance is our largest budget support loan to the Philippines ever and reflects our strong commitment to providing cornerstone assistance swiftly and effectively to help the country mitigate the pandemic’s devastating impact on Filipinos, particularly the poor and vulnerable, including women,” ADB president Masatsugu Asakawa said.
“Amid a global pandemic, the most vulnerable are developing countries, especially those with densely populated cities such as the Philippines. We commend the government for its leadership and clear actions in containing the spread of COVID-19, including scaling up its health response, enforcing an enhanced community quarantine in Luzon to save lives, and rolling out subsidy programs to affected segments of the population,” Asakawa added.
“We thank the ADB under the leadership of President Masatsugu Asakawa for swiftly responding to the Philippines’ call for funding support in this time of crisis. We thank the bank as well for streamlining its operations to quickly deliver its assistance and for tripling the size of its response package from $6.5 billion to $20 billion to help developing member countries combat COVID-19,” Finance Secretary Carlos G. Dominguez III, who serves as the lender’s governor for the Philippines, was quoted by the ADB as saying.
In a separate statement, the Department of Finance (DOF) said that “under the terms and conditions of the Cares loan, the first $500 million that the Philippines can tap from the ADB’s countercyclical support facility pandemic response option (CPRO) facility will be disbursed in US dollars amounting to $250 million, and the euro equivalent of the other half of the amount.”
“This portion of the loan is payable in 10 years inclusive of a three-year grace period. The remaining $1 billion will also be divided equally into the US dollar and euro equivalents of the amount under the terms of the loan accord. This amount is payable in five years inclusive of a three-year grace period,” the DOF said.
“The disbursement of the first $1-billion tranche is expected this month while the remaining $500 million may be disbursed on or before June 20,” the DOF added.
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