WASHINGTON, February 06, 2025 – The World Bank's Board of Executive Directors today approved a project to suuport Colombia's efforts in disaster risk management for adverse natural events, including public health emergencies. The $200 million operation will enable the country to access key resources to develop policies and tools to respond to high-impact natural or public health events at national, subnational, and sectoral levels.
Colombia faces high exposure to various geological threats, such as earthquakes, and hydrometeorological threats, such as floods, landslides, droughts, and wildfires. Additionally, following the COVID-19 experience, the country could be exposed to new pandemics. These threats represent one of the largest unforeseen expenses for Colombia and have a significant impact on its gross domestic product.
The fourth Disaster Risk Management Development Policy Loan with a Catastrophe Deferred Drawdown Option (Cat DDO) serves as a bridge financing source that can be partially or fully disbursed in the event of high-impact natural or epidemiological events. This type of instrument is key to the country's financial strategy to reduce its fiscal vulnerability to disasters.
The new Cat DDO will integrate climate change considerations and promote sectoral resilience in health, transportation, and tourism. Additionally, community participation and gender perspective in risk management will be encouraged.
“This loan reiterates the World Bank's commitment to continue supporting the country's efforts in disaster risk management and provides the necessary liquidity for Colombia to timely assist the population affected by a disaster, especially the poorest and most vulnerable people," said Mark R. Thomas, World Bank Director for Colombia, Mexico, and Venezuela.
This is the fourth Cat DDO that the World Bank has signed with Colombia. The previous three have already been disbursed: in 2011, following the La Niña phenomenon; in 2020, due to the COVID-19 pandemic; and in 2022, to address the emergency caused again by the La Niña phenomenon. The Ministry of Finance and Public Credit and the National Planning Department (DNP) will be responsible for the technical coordination and implementation of this loan.
For the preparation of this fourth operation, resources were available from the Global Facility for Disaster Reduction and Recovery (GFDRR). In addition, these resources supported the DNP in the preparation and dissemination of the Municipal Disaster Risk Index adjusted by capabilities, and the Ministry of Transport in the definition of the geotechnical corridor for Colombian roads.
Additionally, with resources from the Swiss Economic Cooperation and Development (SECO), joint work has been carried out with the Ministry of Finance in defining and implementing financial protection strategies for disaster risks at the national, subnational, and sectoral levels, with the aim of increasing their fiscal capacity to face disasters.
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