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Bangladesh: COVID-19 Active Response and Expenditure Support Program

Sovereign (Public) Project | 54180-001 Status: Active

The CARES program will provide the government with budget support to mitigate the severe social and economic impact of COVID-19 in Bangladesh. The program will fund government expenditures and programs in critical areas such as the expansion of social safety nets for vulnerable women and other groups and support critical labor-intensive industries, SMEs and microenterprises in order to preserve jobs. The government programs will assist the worst-hit industries such as the RMG and service industries.

Project Details

Project Officer
Zhang, Dongdong South Asia Department Request for information
Country
  • Bangladesh
Sector
  • Public sector management
 
Project Name COVID-19 Active Response and Expenditure Support Program
Project Number 54180-001
Country Bangladesh
Project Status Active
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan 3919-BAN: COVID-19 Active Response and Expenditure Support Program
concessional ordinary capital resources lending / Asian Development Fund US$ 250.00 million
Loan 3920-BAN: COVID-19 Active Response and Expenditure Support Program
Ordinary capital resources US$ 250.00 million
Loan: COVID-19 Active Response and Expenditure Support Program
Asian Infrastructure Investment Bank US$ 250.00 million
TA 9973-BAN: Supporting COVID-19 Active Response Program
Technical Assistance Special Fund US$ 1.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Partnerships
Sector / Subsector

Public sector management / Public expenditure and fiscal management - Social protection initiatives

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The CARES program will provide the government with budget support to mitigate the severe social and economic impact of COVID-19 in Bangladesh. The program will fund government expenditures and programs in critical areas such as the expansion of social safety nets for vulnerable women and other groups and support critical labor-intensive industries, SMEs and microenterprises in order to preserve jobs. The government programs will assist the worst-hit industries such as the RMG and service industries.
Project Rationale and Linkage to Country/Regional Strategy

Coronavirus disease 2019 (COVID-19) has had a devastating health, social, and economic impact on Bangladesh. The economic downturn has seriously affected livelihoods, especially of the poor and vulnerable. Many informal workers (85.1% of the workforce) lost their livelihoods instantly after the nationwide lockdown. The lack of social safety net coverage will lead to dire consequences for the more than 20% of the population who live below the poverty line and the many newly jobless who will join them.

The Government of Bangladesh acted quickly to mitigate the health, social, and economic impacts of the pandemic. It implemented aggressive containment measures and announced a countercyclical economic package amounting to $11.2 billion (3.3% of GDP), which includes urgent expenditure to expand the social safety net and stimulate the economy to protect jobs. With rising expenditures and declining revenues, the government urgently needs external financing to support key pro-poor initiatives and to inject fresh liquidity into the economy to increase aggregate demand.

The program will support the government to implement its pro-poor, gender and socially inclusive COVID-19 response plan which expands and strengthens social safety nets to address the needs of poor and vulnerable groups. The government program will also protect employment in the key industries, such as the labor-intensive RMG sector where the majority of the workers are vulnerable low-skilled female workers. The proposed program is aligned with Strategy 2030 (ADB), including operational priorities on addressing remaining poverty and reducing inequalities, accelerating progress in gender equality, and strengthening governance and institutional capacity.

Impact

Inequality and unemployment reduced (Seventh Five Year Plan FY2016 to FY2020 of Bangladesh)

Adverse economic impact of the COVID-19 pandemic mitigated (Comprehensive Response to the COVID-19 Pandemic 2020 of ADB)

Project Outcome
Description of Outcome

Effect of the reform

Adverse socioeconomic impact to vulnerable groups reduced

Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Social safety net to vulnerable groups expanded

Employment opportunities protected

Program implementation supported, and critical structural reforms identified

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services ADB will administer the TA. ADB's South Asia Department will select, supervise, and evaluate the consultants in consultation with the Finance Division of MOF. ADB will recruit a consulting firm with international and national consultants using the quality- and cost-based selection method with a quality cost ratio of 90:10 because of the highly specialized expertise needed. An output-based (lumpsum) contract will be used for the firm contract.
Procurement n/a
Responsible ADB Officer Zhang, Dongdong
Responsible ADB Department South Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SARD
Executing Agencies
Finance Division, MOF (EA)
[email protected]
Bangladesh Secretariat, Dhaka-1000
Bangladesh
Timetable
Concept Clearance -
Fact Finding 06 Apr 2020 to 12 Apr 2020
MRM 15 Apr 2020
Approval 07 May 2020
Last Review Mission -
Last PDS Update 07 May 2020

Loan 3919-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 May 2020 11 May 2020 14 May 2020 31 Dec 2021 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 500.00 Cumulative Contract Awards
ADB 250.00 07 May 2020 250.00 0.00 100%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 250.00 07 May 2020 250.00 0.00 100%

Loan 3920-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 May 2020 11 May 2020 14 May 2020 31 Dec 2021 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 250.00 Cumulative Contract Awards
ADB 250.00 07 May 2020 250.00 0.00 100%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 07 May 2020 250.00 0.00 100%

TA 9973-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
07 May 2020 10 May 2020 10 May 2020 31 May 2022 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
1,000,000.00 0.00 0.00 0.00 0.00 0.00 1,000,000.00 07 May 2020 0.00

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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Tenders

No tenders for this project were found.

Contracts Awarded

No contracts awarded for this project were found

Procurement Plan

None currently available.