ADB offers $2b emergency loan

ADB offers $2b emergency loan

ISLAMABAD: The Asian Development Bank will offer Pakistan a $2bn emergency loan to help repair massive damage to infrastructure caused by the country’s recent floods. Juan Miranda, the bank’s director-general for central and west Asia, told the Financial Times that the ADB would also set up a trust fund to channel donor contributions for reconstruction.

The pledge comes amid rising concern over the sluggish nature of the international response to the flood disaster which began three weeks ago. The United Nations said on Wednesday that it had received almost half of the $459m it needs to fund relief efforts after days of lobbying donors. But most of the 6m Pakistanis the UN said are in urgent need of shelter, water and food have yet to receive international aid.

The ADB will work with the World Bank and Pakistani officials to assess the scale of the damage by the end of September. Mr Miranda said he is due to meet President Asif Ali Zardari in Islamabad on Friday to discuss the terms of the concessionary loan.“We will make available a minimum of $2bn towards the reconstruction effort,” Mr Miranda said. “We have a long-term commitment to the country. This is a time when we have to show what we’re made of, to work with everyone to figure out exactly how we can put back dignity into the lives of the people.” The pledge is the largest commitment made by donors to finance flood-related reconstruction in Pakistan. The World Bank said on Monday it was making $900m available to finance the rebuilding effort.

Mr Miranda said the damage caused by the floods was greater than the combined impact of the Indian Ocean tsunami in 2004, the 2005 earthquake in Pakistan and the Haitian earthquake in January. Flood waters have wreaked havoc across Pakistan, snapping bridges, washing away roads, tearing down power lines, swamping schools and hospitals and damaging irrigation systems. The deluge has affected an area about the size of Italy.

Pakistan’s government says 20m people have been hit by the floods.“I would encourage every donor and the international community to come good at a time when it’s most needed,” Mr Miranda said. “Speed is of the essence. We have to put back facilities to where they used to be or even in better shape.” Anger among flood victims at the pace of their government’s response has fuelled doubts over whether a weak administration dogged by corruption allegations can effectively channel an influx of aid.

Mr Miranda said the bank would establish oversight procedures to ensure donor contributions to its planned reconstruction fund for Pakistan will be used effectively. “We have to and will make absolutely sure that those resources will be used in the way and for the purpose for which they were intended,” he said.The ADB is also providing a $3m grant to Pakistan’s disaster management authorities to purchase boats, helicopters and other equipment needed for relief efforts and to help assess the scale of the devastation. Aid workers say they have experienced only a sluggish global response to their appeal for money to fund emergency relief operations to help people driven from their homes or otherwise affected by the floods.

The UN fears water-borne diseases could trigger a second wave of deaths from the disaster, which has claimed an estimated 1,600 lives. Pakistani officials hope a special United Nations session on the floods due to be held in New York on Thursday will spur a faster response. – Dailymailnews