The Asian Development Bank (ADB) on Friday approved $1.5 billion in financing to help the government provide “social protection, promote food security and support employment” amid catastrophic flooding and global supply chain disruptions.
According to the statement issued by the ADB, the loan has been provided under the bank’s Building Resilience with Active Countercyclical Expenditures (BRACE) Programme.
The statement said It will help fund the government’s $2.3bn countercyclical development expenditure program that is structured to cushion the impacts of external shocks, such as the Russian invasion of Ukraine.
Finance Minister Ishaq Dar also took to Twitter to announce the development, stating that the “agreement signing and release of funds” would take place next week.
Director General of ADB Central and West Asia Yevgeniy Zhukov stated in the press release that external shocks have delayed Pakistan’s recovery from the Covid-19 outbreak.
He added that the program would “help the government manage the impacts of high prices, increasing food insecurity, slowing business activity and reducing income for vulnerable groups”.
The ADB highlighted that the funding would help the poorest families as well as promote women’s empowerment and climate change adaptation, all of which were urgently required in light of the most recent floods.
Additionally, the funding aims to “increase the number of students enrolled in primary and secondary schools, increase the number of families receiving cash transfers from 7.9 million to 9 million, and improve geographic coverage of health services and nutritional supplies for pregnant and lactating mothers and children under two.”
ADB Public Management, Financial Sector and Trade Director Tariq Niazi said that the program would also help the government “continue structural reforms that are necessary to improve the country’s medium to long-term macroeconomics prospects”.