The Asian Development Bank (ADB) has green-lighted a $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.
In a virtual press briefing, ADB country director for the Philippines Kelly Bird said the Cares program would 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 would go to the national budget, it would be up to the Philippine government to choose in which specific programs and projects the money would 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.
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 would 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.