Colombia, DR receive World Bank emergency funds

Colombia, DR receive World Bank emergency funds

Loans Economy & Policy Corporate & Sovereign Strategy Structured Finance Coronavirus Latin America US

Editor's note: LatinFinance’s Daily Brief newsletter is making some of its most important coronavirus-related material freely available to all readers. Visit our coronavirus section for all our coverage and sign up to receive the Daily Brief email in your inbox every morning.

Colombia received $250 million in emergency financing from the World Bank on Saturday and the Dominican Republic drew down $150 million last week in the first two disbursements in $515 million in funding that the multilateral lender has allocated to seven countries in Latin America in less than a week.

The World Bank granted the funds under a contingent credit line known as the Catastrophe Deferred Drawdown Option, or Cat-DDO, which only countries with "adequate macroeconomic policy frameworks" can access, it said.

Colombia's Finance Ministry did not provide details on the loan, but the Dominican Finance Ministry said it agreed to pay 160 basis points over Libor for a 19-year loan with a 12-year grace period. 

In other transactions, the World Bank said it granted $95 million combined to Argentina, Ecuador, Paraguay and Haiti to buy medical supplies and improve testing as part of its $14 billion fast-track facility for COVID-19 response. 

Argentina secured $35 million through a 32-year loan with a seven-year grace period. Ecuador received $20 million from a 28-year loan with an 11-year grace period, while Paraguay got $20 million from a 30-year loan with a nine-year grace period. Haiti received a $20 million grant from the World Bank's International Development Association (IDA).

In Bolivia, the World Bank said it is redirecting $20 million from a $300 million healthcare project for emergency COVID-19 response.

The World Bank has said it could deploy as much as $160 billion in developing countries to combat the coronavirus outbreak and help fund recovery efforts.