CAF devotes $2.5 bln to fight coronavirus

CAF devotes $2.5 bln to fight coronavirus

Loans Economy & Policy Debt Coronavirus Latin America

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Latin American development bank CAF said on Wednesday that its board of directors approved a new credit line for $2.5 billion to help member nations combat the coronavirus outbreak.

The bank's board also approved the possibility of redirecting non-disbursed funds from existing loans to tend to the health and economic crises, CAF said in a press release.

Last week, the bank provided $2.8 million in grants to stop the spread of COVID-19 with $400,000 grants to Argentina, Ecuador, Panama, Paraguay, Peru, Trinidad and Tobago and Uruguay.

CAF joins other multilateral lenders in the region, including the Central American Bank for Economic Integration (CABEI) and the regional development bank for the Río de la Plata basin Fonplata, to offer emergency funding for efforts to contain the outbreak.

CABEI said on March 26 that it had allocated $1.91 billion for a COVID-19 contingency plan. On March 25, it authorized $90 million for Costa Rica's state-owned banks to support productive sectors during the pandemic. 

CABEI also provided $8 million in grants to El Salvador, Honduras, Nicaragua, Costa Rica, Panama, Belize and Dominican Republic along with $25,000 to address the crisis in the Trifinio region, which straddles the borders of El Salvador, Guatemala and Honduras.

Fonplata, meanwhile, approved on Wednesday a $12 million loan to cover lost wages in Argentina. Before that, it granted $25 million for food security in the province of Buenos Aires and $15 million to build emergency hospitals around the country. It agreed to restructure Argentina's loans on March 23.

Fonplata's other member nations, Bolivia, Brazil, Paraguay and Uruguay, will have access to similar emergency credit lines to help in the fight against COVID-19, the bank said. It has already provided $400,000 in grants to buy medical supplies in Bolivia and Paraguay.