The African Development Bank approved grants worth about 41.16 million USD to Djibouti to bolster the national budget in support of government efforts to mitigate national and regional impacts of the COVID-19 pandemic, according to Africa Development Bank.

The funding will take the form of an African Development Fund grant for $4.12 million and a 37.04 million USD grant from the Bank’s Regional Operations Envelope. The Bank is providing the funding under its COVID-19 Response Facility. “It is the first time the Bank is leveraging the Regional Operations resources for a budget support operation. This approach was pertinent to ensure that Djibouti has adequate resources to contain the spread of the COVID-19 pandemic in its territory and limit cross-border impacts that pose serious risks for health, social and economic development for the country and ensure adequate controls at territorial borders and all points of entry,” said the Bank’s Acting Director General for East Africa, Nnenna Nwabufo.

The financing will enable the Government of Djibouti to support three interlinked COVID-19 response programs to enhance health systems; safeguard livelihoods and provide social protection; and defend labour force productivity and economic activity.

Health-sector interventions include the implementation of a multi-sectoral crisis response strategy and dissemination of infection prevention and control guidelines to health facilities. Social protection measures include covering electricity bills for vulnerable households and maintenance of price-control mechanisms and supplies of staple foods.

To support the workforce and economy, the government proposes to suspend nonpriority expenditure while increasing social spending in the budget; defer taxes for the hardest-hit enterprises; and defer tax deadlines and social security contributions for enterprises that commit to continue paying employee salaries.