AIIB supports Pakistan's efforts to manage COVID-19 with $ 500 million.

ISLAMABAD -- The Asian Infrastructure Investment Bank's (AIIB) Board of Directors has approved a loan of USD $500 million for the COVID-19 Active Response and Expenditure Support (CARES) Program to support the Government of Pakistan's efforts to effectively manage the COVID-19 outbreak and reduce its immediate social and economic impacts.

Pakistan's ongoing economic recovery and ability to sustain high and inclusive growth have been significantly impacted by the COVID-19 pandemic, said a press release issued by AIIB here on Wednesday.

Total revenue is expected to decline in FY2020, which will contribute to increasing Pakistan's primary fiscal deficit by about 2 percentage points.

According to press release, these impacts have already led to significant job losses, both in the formal and informal sectors.

AIIB's financing for CARES, funded under the Bank's COVID-19 Crisis Recovery Facility (CRF) and co-financed with the Asian Development Bank (ADB), will promote social protection and economic resilience to prevent long-term damage to the productive capacity, including human capital, of Pakistan's economy.

This policy-based loan is provided through general budgetary support to fill the government's financing gaps in implementing health, social safety net and economic stimulus measures, release said.

The funds will support expenditures allocated by the government for protecting the poor and vulnerable, including women, augmenting the health sector capacity and supplies, and protecting productive sectors and small businesses from economic downturn.

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