Burma

Myanmar Takes US$250 M Loan from ADB for COVID-19 Relief

By Nyein Nyein 29 July 2020

The Myanmar Parliament approved a US$250 million loan from the Asian Development Bank on Wednesday to support the budget for its COVID-19 Economic Relief Plan (CERP).

The Ministry of Planning, Finance and Industry (MOPFI) said the loan will be used to provide social support for low-income households, to enhance the healthcare system and COVID-19 prevention, treatment and containment and to support small and medium-sized enterprises.

The loan is part of the ADB’s COVID-19 Active Response and Expenditures Support (CARES) program.

MOPFI had discussed the loan with the ADB at the end of May and has started designing a Country Engagement Framework for Myanmar as the ADB collaborates with the International Monetary Fund, the World Bank and the Japan International Cooperation Agency (JICA) to support Myanmar’s COVID-19 measures.

U Maung Maung Win, the deputy minister of planning, finance and industry, told the Parliament on Wednesday that the government will work to get the approved loan as soon as possible so it can be used in the sectors where it’s needed.

Launched by the Myanmar government in late April, the relief plan aims to help the country recover from the economic and social impacts of the pandemic. The CERP includes a number of strategies and responses, including steps to re-allocate 10 percent of the 2019-20 budget for all government entities to the COVID-19 response fund.

According to international organizations, Myanmar needs to spend US$2-3 billion to implement its action plans.

The CERP lists a number of key focuses:  improving the macroeconomic environment through monetary stimulus; easing the impact on the private sector through improvements to the investment, trade and banking sectors; assisting laborers, workers and households; promoting innovative products and platforms; strengthening the health care system; and increasing access to COVID-19 response financing, including contingency funds.

U Zaw Htay, the spokesman of the President’s Office, said during a press conference on July 17 that the government will provide payments of 20,000 kyats (US$14.72) in the last week of July to 5.4 million households who have no regular source of income. The payment is the third in a series for low-income families.

He said that support for low-income families is part of the CERP and began in mid-April with support such as basic food items for households who do not have a regular source of income.

The food support reached over 4 million low-income households between April 10-19 and cost over 50 billion kyats (US$36.8 million), according to the President’s Office spokesman.

The government provided financial support to 1.4 million households with each family receiving a payment of 15,000 kyats (US$11.04) between June 27 and July 12. The support was valued at 21 billion kyats (US$15.5 million).

This month, the Union Parliament also approved three other ADB loans: a US$180 million loan for the Yangon city water supply project, a US$171 million loan for rural electrification and a US$483.8 million loan for an expressway connecting Bago Region and Mon State as part of the East-West Economic Corridor.

In May, the Parliament also approved two loans of US$60 million and US$30 million from the ADB for the Enhancing Financial Access Through Public Credit Guarantee Scheme Project and the Additional Financing to Greater Mekong Subregion Health Security Project, respectively.

From 2013 to 2019, the ADB committed loans and grants totaling US$2.4 billion (3.2 trillion kyats) in Myanmar.

You may also like these stories:

Myanmar’s Union Govt Splits Up Huge China-Backed New Yangon City Project

Myanmar to Lift Ban on Foreign Travel for Citizens With Urgent Business

Myanmar Parliament Approves $180-Million ADB Loan Request for Yangon Water Supply

Loading