ISLAMABAD: Pakistan will receive $500 million as co-financing for the BRACE development programme from the Asian Infrastructure Investment Bank (AIIB), Finance Minister Ishaq Dar said on Wednesday.
The BRACE (Building Resilience with Active Counteryclical Expenditures Programme) is an Asian Development Bank financing programme to counter the social fallouts of economic crisis.
“These funds will be received by State Bank of Pakistan within November 2022,” Dar said on his Twitter account.
In October, the ADB had approved $1.5 billion in financing to help Pakistan provide social protection, promote food security, and support employment for its people amid devastating floods and global supply chain disruptions.
The loan, provided under ADB’s Building Resilience with Active Countercyclical Expenditures (BRACE) Programme, will help fund the government’s $2.3 billion countercyclical development expenditure program designed to cushion the impacts of external shocks, including the Russian invasion of Ukraine.
“Pakistan’s recovery from the Covid-19 pandemic has been impeded by external shocks,” said ADB Director General for Central and West Asia Yevgeniy Zhukov.
“Increasing business costs and rising living expenses are affecting millions of Pakistanis, especially the poor and vulnerable. ADB’s program will help the government manage the impacts of high prices, increasing food insecurity, slowing business activity, and reducing income for vulnerable groups, many of whom are also reeling from the devastating floods,” he added.
“The program is part of a comprehensive and well-coordinated package of support. It will help the government deal with the impact of the immediate shocks to the economy, while, in parallel, continuing the structural reforms that are necessary to improve the country’s medium- to long-term macroeconomic prospects,” said ADB Director for Public Management, Financial Sector, and Trade Tariq Niazi.
“We are working closely with the International Monetary Fund and other development partners to ensure that our support through policy dialogue, technical assistance, and program lending is well-coordinated and that, ultimately, we are able to help the government improve Pakistan’s resilience to shocks.”