SMEs, farmers benefit from over $500m in COVID-19 support in Asia-Pacific region
KATHMANDU, AUGUST 24
Thousands of micro, small, and medium enterprises, and millions of farmers across Asia and the Pacific stand to benefit from the first phase of COVID-19 crisis response funding from International Finance Corporation (IFC), a member of the World Bank Group.
As the pandemic continues to send shockwaves through the global economy, IFC supported 13 companies in the region — over 190,000 employees in the manufacturing, agriculture, services and energy sectors — with $554 million in COV- ID-19 related funding in the fiscal year ending June 30, 2020. Also, IFC deployed $492 million in COVID-19 related trade finance lines in the region. This has helped financial institutions provide liquidity to businesses dependent on trade, especially small and medium enterprises (SMEs), as per a media release.
About 17,500 MSMEs and corporates in the region are also expected to be among the beneficiaries of IFC’s $2 billion Working Capital Solutions (WCS) programme in fiscal year 2020. The aim of the programme is to help emerging-market banks extend credit so that businesses can continue to operate, stemming job losses. IFC’s first COVID-19 WCS programme in Asia-Pacific was signed in Sri Lanka with the Commercial Bank of Ceylon to help over 1,200 SMEs — nearly 790 of them women led — deal with the crisis.
“The economic and social impact of COVID-19 will continue to exact a toll on people and businesses, leaving an indelible mark on the region’s economies and private sector,” Alfonso Garcia Mora, IFC’s newly appointed regional vice-president for Asia and the Pacific, has been quoted as saying. “To address this, we are stepping up efforts to support companies strengthening also our support to the financial sector so that businesses and firms can build resilience on road to recovery.”
The WCS programme is part of IFC’s $8 billion global COVID-19 fast-track financing facility developed to help businesses cope with the ongoing global slowdown, marked by a collapse in tourism, plunging trade, disruptions to supply chains, and diminished foreign direct investment.
The fiscal year 2020 also saw IFC work upstream and with the World Bank on complex projects with potentially transformative impact to deliver power to millions of people in Nepal, Afghanistan and Pakistan. IFC also advised governments and the private sector in a range of areas from green sustainable finance and gender issues to helping companies and institutions through webinars to cope with COVID-19 impacts.
Overall, IFC committed $6.7 billion in private sector investments in Asia and the Pacific in the fiscal ending June 30, 2020.This includes $554 million in IFC financing in response to COVID-19 under the new COVID-19 fast-track facility. Just under half of this was for countries classified as poor, fragile and conflict-affected. IFC also supported around $ 1.1 billion of cross-border trade in the region through its Global Trade Finance Programme.
A version of this article appears in e-paper on August 25, 2020, of The Himalayan Times.