The World Bank Group has expressed its readiness to deploy about $150bn over the next 15 months to stimulate economic recovery of countries affected by the coronavirus pandemic.
The coronavirus pandemic has led to unprecedented disruptions to global supply chains, sharp drop in global crude oil prices, turmoil in global stock and financial markets, and lockdown of large movements of persons in many countries.
These outcomes have had severe consequences on households’ livelihoods and business activities, resulting from drop in global demand, declined consumer confidence and slowdown in production.
The World Bank Group President, David Malpass, in his remarks at the G20 finance ministers conference call on the COVID-19 pandemic said these were difficult times for all, especially for the poorest and most vulnerable.
For the World Bank Group, he said the first goal was to provide prompt support during the crisis based on a country’s needs.
He noted that it was vital for governments of countries affected by the pandemic to shorten the time of recovery and create confidence that the recovery could be strong.
Malpass said the bank was currently restructuring existing projects in 23 countries.
Many of these projects restructuring, according to him, would be made through the use of contingent emergency response components.
He said the bank was also preparing projects in 49 countries through a new fast-track facility.
The World Bank boss said the final decisions on 16 out of these 49 country programmes would be made this week.
He said beyond the severe health impact from the pandemic, there would be a major recession of the global economy.
He said, “We are working to provide a fast response, utilising all our available instruments.
“Countries need to move fast to boost health spending, strengthen social safety nets, support the private sector and counter financial-market disruption.
“Countries will need to implement structural reforms to help shorten the time to recovery and create confidence that the recovery can be strong.
He added, “For those countries that have excessive regulations, subsidies, licensing regimes, trade protection or litigiousness as obstacles, we will work with them to foster markets, choice and faster growth prospects during the recovery.
“The resources to address the problems I’ve discussed are substantial. The World Bank Group, including International Finance Corporation and Multilateral Investment Guarantee Agency, could deploy as much as $150bn over the next 15 months.”
Recall that on March 17, the World Bank and IFC boards approved a $14bn package to respond to COVID-19.
Of that amount, IFC is making $8bn available in relatively fast-acting financial support for private companies.
