Govt now turns to AIIB for $450m
Bangladesh has sought $450 million from the Asian Infrastructure Investment Bank (AIIB) because of this fiscal year to meet up the emergency health expenditure and finance the massive stimulus packages the united states has unveiled when confronted with coronavirus outbreak.
The Economic Relations Division (ERD) has sent a letter to the Beijing-based multilateral lender for $200 million for medical sector and $250 million in budget support.
"Negotiations for the fund have begun. We desire to avail the fund in the current fiscal year," said an ERD official.
The World Bank has approved $100 million for the health sector in Bangladesh to greatly help the united states combat the deadly bug. Now, $100 million from the AIIB would be used as co-financing in the project.
Another $100 million would be used to create infectious disease hospital at the country's eight divisional cities.
The fund isn't enough to build the hospitals, however the government would be able to start the projects with the assistance, the ERD official said.
Finance Minister AHM Mustafa Kamal is also seeking $500 million in budget support from the Beijing-based multilateral lender for the next two fiscal years to greatly help the country slipping into financial ruins from the countrywide pause in monetary activities to flatten the curve of the lethal pathogen.
He made the requests while talking with AIIB President Jin Liqun throughout a video conference yesterday.
The fund will be used for automation in the agriculture sector, agriculture produce, fruit and vegetable processing, cold-storage, leather processing, fish and poultry sectors.
"We've requested the AIIB to keep its support and assist with help us ride out the crisis," Kamal said in a news release afterwards.
He has urged the AIIB to supply another $100 million to rehabilitate micro, small and medium enterprises.
Liqun told Kamal that the AIIB would actively consider the requests and there could possibly be some change to the funding modalities, in line with the news release. The ERD would now send formal requests to the AIIB.
The AIIB has doubled available funds under its COVID-19 Crisis Recovery Facility to provide $5 billion to $10 billion due to high client demand.
"The global economy is facing a formidable challenge. The situation is changing with each passing day. If we don't begin to take into account the economy now while tackling the pandemic, it could not be possible to come back the economy to normalcy even in 2021," said Liqun in the news release.
Bangladesh is approaching multilateral development partners to mobilise funds for the stimulus packages it announced in response to the pandemic, which has up to now infected 4,186 persons in the united states and killed 127.
Prime Minister Sheikh Hasina announced a bunch of stimulus packages amounting Tk 95,619 crore, which is 3.3 % of the GDP, targeted at aiding people's purchasing power, widening social safety nets, increasing money supply and making working capital designed for the industries, service sector organizations and cottage industries.
Bangladesh has approached the Asian Development Bank for $1.25 billion, $700 million from the International Monetary Fund and $500 million from the Islamic Development Bank.
DJ Pandian, AIIB's vice-president for investment operations, also took part in the video conference.
