MANILA, PHILIPPINES (25 November 2020) — The Asian Development Bank (ADB) has approved a $20 million loan to help the Government of Cook Islands manage the social and economic impacts of the coronavirus disease (COVID-19) pandemic.
“ADB is committed to supporting the people of the Cook Islands as they respond to the impacts of the COVID-19 pandemic,” said ADB President Masatsugu Asakawa. “This assistance will enhance the government’s ability to prevent the pandemic from entering the Cook Islands, manage any possible cases, and mitigate the negative social, health, and economic impacts caused by the pandemic on livelihoods and local business, with a special focus on vulnerable households.”
The COVID-19 pandemic has severely hit tourism, with the South Pacific economies the most affected. The Cook Islands’ economy is expected to have contracted 7.0% in FY2020 (the 12-month period ending June 2020) and is expected to fall an additional 15.4% in FY2021 due to a collapse in tourist arrivals. Tourism-related jobs account for about half of all private sector employment or one-third of total jobs, and the economic contraction risks unwinding hard-fought development gains.
The $20 million COVID-19 Active Response and Economic Support Program will help finance the government’s Economic Response Plan (ERP), which includes employment support payments to keep workers on the job; one-off cash payments for the elderly, the infirm, and caregivers; interest and credit relief for households and businesses; support to the health sector; and business grants to affected businesses and sole traders.
The loan is funded through the COVID-19 pandemic response option (CPRO) under ADB’s Countercyclical Support Facility. CPRO was established as part of ADB’s $20 billion expanded assistance for developing member countries’ COVID-19 response, announced in April. Visit ADB’s website to learn more about its ongoing response.
This is ADB's fourth round of assistance for the Cook Islands to mitigate the effects of the pandemic, following a $10 million loan and $1 million grant in July, and ADB grant funding in March and June for medical supplies disbursed in collaboration with UNICEF.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.