Strategy for Disaster Reduction
Latin America and the Caribbean
Newsletter ISDR Inform - Latin America and the Caribbean
Partners in Action
Inter-American Development Bank (IDB) Financial Mechanisms for Risk Management
In order to respond to changes in the development needs of the region, particularly in the field of disaster risk management, the Inter-American Development Bank (IDB) has set up two financial mechanisms: the Disaster Prevention Sector Facility and the Emergency Reconstruction Mechanism.
The Disaster Prevention Sector Facility
The purpose of the
Disaster Prevention Sector Facility is to reinforce disaster prevention
and risk management systems, reducing vulnerability and increasing the
level of natural disaster preparedness. The Sector Facility will help
countries to meet the risk reduction goals in their development plans
through the building of consensus in such areas as cross-sectoral priorities,
institutional strengthening and capacity building to enable countries
to launch more ambitious disaster reduction programs.
In addition to providing reimbursable financing, and in collaboration with bilateral donors, the IDB will also mobilize non-reimbursable grant funds selectively, particularly in the case of low-income countries, to identify intervention needs and opportunities.
The Sectoral Facility will help countries to adopt an integral approach to reduce and manage the risk posed by natural disasters before catastrophe strikes, by means of the following components:
Funding will also focus on
The purpose of the Mechanism is to deliver as quickly as possible the resources needed to finance a pre-established menu of eligible activities, which include assistance to accelerate the re-establishment of public services, or the funding of temporary repairs and clean-ups in the period immediately after a natural disaster. A countrys application for these resources sets in motion a fast-track loan-approval procedure in the Bank headquarters, which can last between two and four weeks. The initial US$100 million fund has been exhausted; based on an assessment of its results, the operation will continue, perhaps without a preset overall limit, although individual operations will still be subject to an upper limit. The Mechanism can lend as much as US$20 million in ordinary capital resources or US$10 million from the Special Operations Fund, which provides highly concessional resources.
For more information: www.iadb.org