by Elisa Valenta
The World Bank has approved to give $700 million financing to help Indonesia to respond to the COVID-19 pandemic. The financing will help support the country to enhance its social protection system and strengthen the financial sector.
The first is $400 million of additional financing for Social Assistance Reform Program. The initial project was approved three years ago and has successfully supported the government’s social assistance program—the Family Hope Program (PKH)—to expand its coverage from 6 million to 10 million families.
The second is the $300 million COVID-19 Supplemental Financing for Indonesia’s First Financial Sector Reform Development Policy Loan. The initial development policy loan was approved in March 2020 to help increase the depth, efficiency and resilience of the financial sector against the pandemic.
“The unprecedented nature and reach of the COVID-19 outbreak and its negative impacts call for swift support by the World Bank globally,” said Satu Kahkonen, World Bank Country Director for Indonesia and Timor-Leste in a statement.
The ongoing pandemic has heavily affected the poor and vulnerable as well as informal workers. This supplemental financing will help the government cover an unanticipated financial gap that has arisen due to the pandemic and to support real economy by channeling funds t o households and firms
“With support from international institutions such as the World Bank, we are able to provide relief for different needs such as the provision of social assistance and maintaining the resilience of the country’s economy,” said Minister of Finance Sri Mulyani Indrawati.