ADB to provide 200 million USD to support strained supply chains in fight against novel coronavirus
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The Asian Development Bank (ADB) will make available 200 million U.S. dollars through its Supply Chain Finance Program for companies manufacturing and distributing medicines and other items needed to combat the novel coronavirus (COVID-19).
Companies manufacturing and distributing products, including medicines and personal protective equipment, are increasingly strained as production and distribution ramp up to address COVID-19, says press release issued by ADB on March 12.
The support from ADB, working in partnership with commercial banks, will provide such companies in Asia and the Pacific with additional working capital to meet expansion and other requirements.
“The support will target companies in the supply chain that are critical to fighting the virus,” said ADB’s Head of Trade and Supply Chain Finance Steven Beck. “We’re looking to support companies that want to ramp up production and therefore need to engage suppliers.”
Given that a single pool of supply chain finance is typically used for a subsequent delivery over a period of 120–180 days, the $200 million facility could support more than $400 million of financing over the next 12 months. Fifty-fifty risk sharing from partner commercial banks could boost support under the facility to $800 million over the same period.
The funds will be made available through ADB’s Supply Chain Finance Program and provided to selected companies within weeks. ADB is closely monitoring the impact of COVID-19 on trade finance and is in regular contact with client banks to assess whether additional support is required.
ADB’s response to COVID-19 to date reportedly includes $2 million announced on February 7 to enhance detection, prevention, and response in the People’s Republic of China (PRC) and the Greater Mekong Subregion; another $2 million announced on February 26 to support response in all its developing members; and a CNY130 million ($18.6 million) private sector loan, signed on February 25, to Wuhan, PRC-based pharmaceutical distributor Jointown Pharmaceutical Group Co. Ltd. to support the continued supply of essential medicines and personal protective equipment.
Meanwhile, staff at ADB’s headquarters in Manila, Philippines, are temporarily working from home from March 12 following advice that a visitor to the Bank has tested positive for the coronavirus COVID-19.
The Bank’s Manila headquarters facility will be closed from March 12 to undertake cleaning and disinfecting, according to press release issued by ADB.
Bank operations will continue. ADB Management will make a decision in coming days on when to reopen the Bank premises.
“The safety of staff, visitors to the Bank, and their families is of utmost importance to us. We are providing support to staff who interacted with the visitor,” said ADB Vice President for Administration and Corporate Management Ms. Deborah Stokes.
Source: Asia Plus