THE WORLD Bank has committed $12bn (£9.4bn) to help developing countries cope with the spread of coronavirus.
The aid package includes technical assistance as well as low-cost loans and grants to lessen the economic impact of the outbreak – and hopefully prevent a growing global slowdown becoming a recession.
The World Bank’s other aim is to improve countries’ public health response to the crisis and “limit the transmission of the disease”. It isn’t the only financial organisation taking action. The Bank of Japan has said it will inject liquidity into markets and is reportedly considering raising asset purchases. G7 finance ministers and central bankers have also met to discuss responses to the outbreak.
Some $4bn (£3.13bn) of the aid package has been repurposed from the bank’s International Finance Corporation funds. The aid will prioritise the most at-risk of the 70 countries so far affected.
Confirmed cases around the world are nearing 100,000, most in China, followed by South Korea. The global death toll climbed steadily to more than 3,000, but new infections and deaths are said to be stabilising, or declining.
“The point is to move fast; speed is needed to save lives,” World Bank Group president David Malpass told a news conference. “There are scenarios where much more resources may be required. We’ll adapt our approach and resources as needed.” Malpass admitted there were “still many unknowns” surrounding the spread and effect of the virus.
The Dow Jones dropped close to 800 points earlier this week, despite a 0.5 percent rate cut by the US Federal Reserve – the biggest since the 2008 global financial crisis. Stock markets on Wall Street and in Asia have begun to rally as a result of the World Bank announcement.