The Asian Development Bank (ADB) has approved a $250 million policy-based loan to support Bangladesh’s economic recovery following the Covid-19 pandemic.
This is the first subprogramme of the programmatic $500 million Sustainable Economic Recovery Programme, ADB said in a statement yesterday.
The objective of the programme is to facilitate a rapid and sustainable recovery from the Covid-19 pandemic, generate employment, and expand economic activities for micro-entrepreneurs and small businesses, it said.
“This will be pursued through policy reforms that will create fiscal space to enhance public expenditure and support the recovery and growth of cottage, micro, small, and medium-sized enterprises (CMSMEs).”
The loan will also support the government’s planned public investment in education, health, social protection, and infrastructure and help to stimulate economic activities and economic recovery.
“The fiscal space created under the program will allow the government to prioritize expenditures and upscale investment in social and economic infrastructure,” said ADB Principal Financial Management Specialist Srinivasan Janardanam.
“The program is expected to increase the efficiency in public investment management and create a favorable environment for access to credit, particularly for the poor and vulnerable.”
To promote fiscal sustainability, the programme will help the government address two key constraints to public investments in critically needed physical and social infrastructure, ADB said.