Bangladesh and World Bank signed a $300 million financing agreement to help the country strengthen its local urban institutions.

The government of Bangladesh and the World Bank signed a $300 million financing agreement to help the country strengthen its local urban institutions to respond to and recover from the COVID-19 pandemic and improve preparedness to future shocks.

The Local Government COVID-19 Response and Recovery Project will benefit 39.9 million urban residents in all eight divisions. It will help its cities and towns to build back better as they recover from the pandemic and prepare for future shocks, including climate change, disasters, and disease outbreaks. In addition, 329 municipalities and 10 city corporations will receive funds bi-annually from the project to improve critical urban services and infrastructures to mitigate and respond to climate change impacts, disasters, and future disease outbreaks.

“Bangladesh is rapidly urbanizing. With around 36 percent of the population living in urban areas the city corporations and the municipalities can play a critical role in helping the urban poor recover from the pandemic as well as prepare to handle future shocks” said Mercy Tembon, World Bank Country Director for Bangladesh and Bhutan. “This project will help local government institutions take the right measures to move toward climate-smart urbanization and prepare for resilience in future shocks.”

The project will carry out labor-intensive public works that on the one hand will ensure water supply and sanitation, drainage, and other critical services benefitting the low-income areas, slums, and areas exposed to high disease outbreak and disaster risks and on the other hand create jobs for the poor urban people. It will create 1.5 million days of short-term work as well as jobs for 10,000 women under the public works scheme.

All infrastructure will incorporate energy efficiency measures, including solar panels and cool roof measures in municipal buildings and services. The project will install hand-washing stations and toilets, including separate facilities for women, and improve sanitization in public spaces such as markets, burial grounds, and offices. It will also help disabled people to access municipality-owned health clinics and conduct awareness programs on vaccines and other COVID-19 protocols, as well as outreach on gender-based violence and climate risks.

“With quick and proactive measures, the Bangladesh government will be able to address the impact of the COVID 19 pandemic,” said Sharifa Khan, Secretary, Economic Relations Division, Government of Bangladesh. “The project will further support to ensure that the urban areas remain prepared for any future shocks while benefitting the urban poor through job creation, better services, and infrastructure.”

The agreement was signed by Sharifa Khan and Mercy Tembon on behalf of the Government and the World Bank, respectively.

The credit is from the World Bank’s International Development Association (IDA), which provides concessional financing, and has a 30-year term, including a five-year grace period. Bangladesh currently has the largest ongoing IDA program totaling $14.7 billion. The World Bank was among the first development partners to support Bangladesh and has committed more than $38 billion in grants, interest-free and concessional credits to the country since its Independence.


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