IMF To Provide Rs 25 billion Assistance To Nepal
May 7, 2020 | Investopaper
International Monetary Fund (IMF) has announced Rs. 25 billion in aid to Nepal. Under the quick loan facility, Nepal will receive 100 percent assistance as per the quota. This will help Nepal in the immediate balance of payments and to address the obligations of the government to control the corona virus epidemic.
The corona virus epidemic has had a simultaneous serious impact on Nepal’s economy in various sectors. Remittance inflows are declining, tourist arrivals are nil, and regulations on maintaining physical distance have hit domestic economic activity hard.
“The IMF’s assistance will help the government to meet its immediate external obligations (payments) and the costs incurred due to the Corona virus epidemic,” the IMF said.
The government has given immediate priority to reducing human and economic losses. As per the government officials, Nepal needs to increase spending on the health sector.
There is pressure on the government to increase insurance facilities for those working in the medical field, import more health supplies, build quarantine centers and temporary hospitals to fight the epidemic.
The government is distributing daily food items to the at-risk communities through social assistance mobilization. Concessions on public utility services have been provided for low-income consumers, while there are plans to provide some compensation to those who lose their jobs. In addition, some monetary measures have been taken to increase access to credit and adequate liquidity in the financial sector.
Initially, the IMF extended the repayment period for 25 low-income countries, including Nepal. The loan repayment period was initially announced for six months, but could be extended to two years depending on the impact of the corona virus epidemic, as said by the IMF.
