May 8 : The International Monetary Fund (IMF) has approved a disbursement to Nepal under the Rapid Credit Facility (RCF) equivalent to SDR 156.9 million (about $214 million, 100 per cent of quota) to help cover urgent balance of payments (BoP) and fiscal needs stemming from the COVID-19 pandemic.
The COVID-19 pandemic is having a severe impact on Nepal’s economy. During recent months, remittances have fallen considerably, tourist arrivals have collapsed, and domestic activity has taken a hit amid social distancing measures, according to a press communique issued by the IMF.
It ssaid that Nepali authorities are increasing health spending, including by providing additional incentive pay and insurance coverage to all medical front-line personnel, importing additional medical supplies, and setting up quarantine centres and temporary hospitals.
They are also, as stated by the communique, strengthening social assistance by providing those most vulnerable with daily food rations, subsidizing utility bills for low-usage customers, and taking steps to partially compensate those who suffer job loss.”In addition, measures are being implemented to ensure adequate liquidity in the financial system and support continued access to credit.”
The IMF hoped that it financial support make a substantial contribution to filling immediate external and fiscal financing needs that have emerged due to Covid-19. It is also expected to catalyze additional support from development partners.
