World Bank working on repurposing $2bn to help combat Covid-19

The World Bank is working on repurpose of up to $2 billion, to make available to support Pakistan's recovery initiatives of the pandemic through building on safety net programme, supporting employment through public works programme and micro-enterprises, and addressing the looming food security issue.

This was stated by the WB Country Director in Pakistan, Illango Patchamuthu, during an online COVID-19 Policy Response Dialogue "World Bank's support to Pakistan in Responding to COVID-19", organised by the Sustainable Development Policy Institute (SDPI).

Every crisis presents an opportunity, whereas the COVID-19 provided the world and Pakistan an opportunity to reform the social sector policies and to initiate the structural reforms in institutions that need to concurrently happen, which were delayed for years now, the WB official added.

"We are working on how we can repurpose a good part of our pipeline, around $600 million to $2 billion, to make available to support recovery initiatives through building on safety net programme, supporting employment through public works programme and micro-enterprises and addressing the looming food security issue," he said.

While commenting on the WB support initiatives for Pakistan amid COVID-19 crisis, Illango said that initially the bank was able to repurpose the $40 million aid programme to help the government in immediately purchasing the medical equipment and supplies that already had started to arrive at district and local levels.

The bank board recently approved $200 million pandemic responsive fund facility for Pakistan, which was part of the $14 billion global fund facility for coping with the pandemic.

He said that out of $200 million fund, $150 million covered immediate response of purchasing the medical equipment, and $50 million covered the relief through Ehsaas cash transfer to help poor families.

He further said that they were working with the Ministry of Finance, Commerce, Energy and Planning and Development departments both at federal and provincial levels to look at structural reforms that needed to concurrently happen, which were delayed for years now.

Structural reforms need to go hand in hand, because fiscal challenge continues to remain there and will be further constrained due to the COVID 19 related response.

Stressing the need for investing in human capital, he said that Pakistan was spending around three percent of the GDP on health sector and that needed to be enhanced.

Executive Director SDPI Abid Qaiyum Suleri said that the world had learnt after COVID19 outbreak that social services such as health, education, water, and sanitation etc, could not be reduced to be private commodity that only rich might afford to buy.

He said it was about time that multilateral development partners such as the WB should play their due role by investing in social sector rather than mega development projects only.

This would help in bringing the focus of member governments back to social sector development, he maintained.

Aliya Kashif, senior health professional at the WB said Pakistan's health care system was not equipped to handle such emergencies, whereas WB was working with the government to help enhance health capacity to respond to the challenge effectively.

Gonzalo Varela, trade economist at World Bank Group (WBG) said that they had seen substantial impact on exporters, where 2/3rd exporters had experienced 10-50 percent reduction in orders, and global trade was going to drop to unprecedented levels.

It is believed that Pakistan's exports will be substantially impacted. He suggested the need for protecting the exporters through relief measures, whereas structured reforms were going to be crucial for recovery.