Opec pledges $1bn to help developing countries fight Covid-19

The funds will be disbursed through public, private and trade finance loans

Opec+ is cutting back production until 2022 to counter the demand crunch from the coronavirus pandemic. AFP

The OPEC Fund for International Development (Ofid), the development finance arm of the Organisation of the Petroleum Exporting Countries, pledged $1 billion (Dh3.67bn) to help developing economies cope with the economic fallout of the coronavirus pandemic.

The financing will be disbursed through public, private and trade finance loans, Opec said in a statement on Thursday.

"We recognise that many of our partners are refocusing efforts and resources to contain and mitigate the impact of Covid-19," Abdulhamid Alkhalifa, director-general of Ofid, said.

"We are committed to supporting them to do precisely this and the board [of the fund] has endorsed a robust fast-track approval process as part of our emergency response initiative."

The fund said it would coordinate with the financial institutions of the Arab Coordination Group, multilateral development banks and specialised agencies of the United Nations to provide development financing.

The fund's latest move comes after it announced a total financial package of $200 million in March to support international efforts to combat the Covid-19 outbreak. Out of this, $500,000 will be granted to Iran, the fund said earlier.

The group said it also approved more than $390m in new funding, with loans worth $130.5m to be distributed to the public sector in Egypt, the Maldives, Mali, Nicaragua and Tanzania.

Meanwhile, the Ofid said it will commit $141.5m to private sector operations and has approved allocation of $120m for trade financing.

The fund was established in 1976 by the then 13 member countries of Opec, including the UAE, to provide aid to developing countries.