The first case of Coronavirus (COVID-19) was detected on 31st December in Wuhan, China. By late January, the virus had affected a huge number of inhabitants in Wuhan and was spreading to the rest of China and the world, so the World Health Organization declared it to be a Public Health Emergency of International Concern and my March, it was declared a pandemic. The rapid and unprecedented spread of COVID-19 has resulted in many nations closing their borders and prohibiting international travel, leading the world to a phase of economic decline caused by a slowdown in industries. Amid this fear of a global recession, the World Bank approved, on March 17th, an increased package of $14 billion to financially assist companies and countries in their efforts to prevent, detect and respond to the spread of COVID-19.
The World Bank, in its statement, said that this increased package is predicted to “strengthen national systems for public health preparedness including disease containment, diagnosis and treatment, and support the private sector”. David Malpass, President of the World Bank, said that the financial and economic blow, caused by the pandemic, to companies, business and also their employees, will be softened by this financial assistance. The International Finance Corporation (IFC), a member of the World Bank Group, has promised to increase its COVID-19 related financing availability to up to $8 billion from $6 billion as part of the $14 billion packages, to support private companies and their employees affected by the economic dip caused by the pandemic. This additional $2 billion was added to help micro, small and medium-sized businesses after they were recognized to be most susceptible to this economic shock. The IFC response focuses on 4 major components:
The bulk of the IFC financing will go to helping clients who offer trade financing, working capital support and medium-term financing, businesses in sectors like tourism and manufacturing that have been greatly affected by the situation, and sectors involved in fighting the pandemic like the healthcare sector.
On April 2nd, the World Bank’s board of Executive Directors approved the first set of emergency support operations for developing countries and it is also prepared to deploy up to $160 billion over the next 15 months to support countries in using COVID-19 measures to respond to immediate health consequences of the pandemic and bolster economic recovery. This broader financial assistance program is in line with the United Nations’ measures for economic recovery as it aims to reduce recovery time, create conditions for economic growth by supporting small and medium businesses, and help protect the vulnerable. Among the initial projects approved were financial assistance in the form of millions to Ethiopia, Mongolia, Cambodia, Tajikistan, Haiti, Yemen, Afghanistan, Pakistan and even $1 billion to India.
This four-year project aims to develop the preparedness of India’s health care systems by supporting screening, contact tracing, laboratory diagnostics, procurement of personnel protective equipment and setting up of new isolation wards. According to the project document, the government assessment seems to be that outbreaks like Covid-19 will continue in the coming years, and hence there needs to be a long-term strategy to tackle the next wave of the disease. For example, one of the focus areas of this partnership is on India's emergency response system to the disease — the aim of this component of the project is to slow down and limit the spread of Covid-19, the joint document says. This, both the parties say, will be achieved by providing immediate support to enhance disease detection capacities through increasing surveillance capacities, port health screening, etc.
With funds already set aside to help developed countries, the World Bank, in its broader economic program has recognized the impact of this crisis on developing countries in the Global South. The financial assistance will go a long way in helping countries like India, Mongolia, Haiti, Ecuador, Ethiopia and Tajikistan bring more medical professionals on board, ensure public outreach, increase resources and improve the overall strength and capacity of the healthcare system.
