A health worker takes blood sample from a worker for rapid screening of coronavirus at a cigarette factory in Madiun, East Java, on May 27, 2020. (Antara Photo/Siswowidodo)

World Bank Approves $250m Loan for Indonesia's Covid-19 Relief


MAY 29, 2020

Jakarta. The World Bank announced its approval to finance Indonesia's Covid-19 Emergency Response Project by $250 million to help the country improve its health facilities, equipment, and surveillance system as part of the pandemic mitigation efforts.

"Indonesia is utilizing all possible means to mitigate the impacts of Covid-19. With this support, we are committed to strengthening our prevention, testing, treatment, and information systems and protect our health workers," Finance Minister Sri Mulyani Indrawati in a statement on Friday.


The Asian Infrastructure and Investment co-financed with the World Bank for this program. Indonesia also received an additional $200 million loan from the Islamic Development Bank.

"We also welcome our development partners' efforts to provide coordinated financing, and the World Bank's collaboration with the Asian Infrastructure Investment Bank and the Islamic Development Bank on this program," Sri Mulyani said.

The project focuses on strengthening the country's emergency response to the pandemic, which includes increasing the laboratory network and surveillance systems and improving intensive care capacity.

Elderly, those with chronic disease and other vulnerable groups Covid-19 patients, including health workers, will benefit from the program.

It will also support Indonesia's preparedness for infectious disease outbreaks in the future through better reporting and surveillance systems.

"We are proud to support Indonesia's Covid-19 response and its efforts to minimize the impact of the pandemic, which is critical to ensure continuity to reduce poverty and protect the human capital," Satu Kahkonen, World Bank country director for Indonesia and Timor-Leste said in the release.

Half a million people who used to find employment in Indonesia's vast informal sector have lost all of their income and are now at risk of falling into absolute poverty.

In the formal sector, a total of 1.5 million workers have already lost their jobs from March to April, according to data from the Manpower Ministry. 

The government will spend Rp 641 trillion ($44 billion) on healthcare, social safety net, and business incentives during the pandemic under the National Economic Recovery program.

Sri Mulyani projected this year's deficit would reach Rp 1,028.5 trillion, or 6.27 percent of the country's gross domestic product (GDP), the largest deficit since at least 1988.