The International Finance Corporation (IFC), a member of World Bank Group is investing USD50 million in Bank of Maldives (BML).
As per Maldives national bank, the World Bank member is providing the finance for private sector companies.
Moreover, BML in their statement notes IFC investment to their bank will “help preserve jobs and combat negative shocks of Covid-19 on the economy.”
Furthermore, the bank notes IFC’s investment will release in three tranches.
IFC made commitment of first tranche of USD20 million on Wednesday.
Meanwhile, this move is part of IFC’s first phase of crisis support to countries.
Additionally the funding will enhance BML to provide working capital finance for local businesses.
Although IFC commits USD20 million on Wednesday, the provision will mobilize up to USD50 million.
Furthermore, BML in their statement notes tourism, the mainstay of Maldives economy contributes over two-thirds of the country’s GDP.
Moreover, it contributes to 80% of exports, 40% of revenue and remains a key factor in country’s rapid economic growth.
However, with the Covid-19 spreading across borders and tourism coming to a complete halt, Maldives is one of the hardest hit countries in South Asia.
Meanwhile, the predictions of growth in Maldives economy expects contraction by 13% in 2020.
Sawyer further adds “this injection of millions of dollars in support from IFC is extremely timely and will provide further support to our efforts to respond to the crisis.”
Earlier, tourist arrivals to Maldives started declining from February onward, with a 63% slip year on year in March.