France approves 150m euro loan for Bangladesh's Covid-19 fight

Diplomatic Correspondent

The Executive Board of the French Development Agency (Agence Française de Développement - AFD) has approved a concessional loan of 150 million euro to support Bangladesh with its cash transfer programs and COVID-19 responsiveness.

The embassy in Dhaka on Thursday said the loan will contribute towards the World Bank supported Cash Transfer Modernization Project which seeks to improve the transparency and efficiency of selected cash transfer programs for vulnerable populations by modernizing service delivery.

It would also support government efforts to address the social and economic consequences of the COVID-19 epidemic.

The project has three components. (1) Enhancement of Cash Transfer Programs, which incentivizes actions towards improving the business processes under selected cash transfer programs; (2) Modernization of Service Delivery, which provides technical assistance to support the enhancements of technology assets, utilize integrated information systems for targeting and payment, improve citizen engagement, and strengthen the capacity of human resources, and (3) Contingent Emergency Response (CER) to allow project financing to be mobilized rapidly in response to a natural or human-induced shock, disaster or crisis.

The CER component will support the government's response to the COVID-19 crisis. The loan will provide co-financing of the Old Age Allowance program of the Ministry of Social Welfare (MoSW) and Department of Social Services (DSS) until 2023.

It will directly benefit the country’s most vulnerable populations who are beneficiaries of this, as well as other Ministry of Social Welfare (MoSW) cash transfer programs, as well as non-beneficiaries who may qualify for these programs.

The French Development Agency funds, supports and accelerates the transitions to a fairer and more sustainable world.

Focusing on climate, biodiversity, peace, education, urban development, health and governance, AFD carries out more than 4,000 projects in France’s overseas departments and territories and other 115 countries.

In this way, AFD contributes towards France’s commitment to support the sustainable development goals.

Present in Bangladesh since 2012, AFD supports projects in urban development and infrastructure, as well as in the power & green energy sectors.

In addition, AFD also focuses on corporate and social responsibility.

As of 2020, AFD has committed 761 million euros to Bangladesh including 25 million euros in the form of grants.

Through this new loan and an upcoming grant of 1 million euros (2050 Facility), the AFD will contribute to improved resilience to climate change adaptation by reinforcing the social protection system.