Bhutan - COVID-19 Crisis Response DPC

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The development objectives of the COVID-19 Crisis Response Development Policy Credit in Bhutan: (i) strengthen policies for economic resilience and environmental sustainability and (ii) enhance programs to address the economic, social and health impact of COVID-19. The operation supports reforms that address the economic, social and health impact of COVID-19 while maintaining a line of sight to address Bhutan’s structural constraints to a resilient recovery. It is structured under two pillars. The first pillar focuses on reforms to address structural constraints to a resilient recovery, aimed at strengthening policies for economic resilience and environmental sustainability. Reforms focus on: (i) strengthening domestic non-hydropower tax revenue; (ii) enhancing debt and fiscal transparency; (iii) strengthening the regulatory framework of the tourism sector to support the post-COVID economic recovery; and (iv) reducing greenhouse gas emissions and pollution. Reforms under the second pillar enhance programs to address the economic, social and health impact of COVID-19. Reforms focus on (i) operationalizing a credit guarantee scheme for small and medium-sized enterprises; (ii) establishing the institutional framework for the deployment of COVID-19 vaccines and future booster shots; and (iii) mitigating the impact of gender-based violence (GBV) during and beyond lockdowns.