By Francis Ghesquiere and Olivier Mahul
This week, the Resilience Dialogue, bringing together representatives from developing countries, donor agencies and multilateral development banks, will focus on financing to build resilience to natural disasters.
There is growing recognition that resilience is critical to preserving hard won development gains. The share of development assistance supporting resilience has grown dramatically in recent years. New instruments have emerged in particular to help client countries deal with the economic shock of natural disasters. In this context, an important question is which financial instruments best serve the needs of vulnerable countries? Only by customizing instruments and tools to the unique circumstances of our clients, will we maximize development return on investments. Clearly, low-income countries with limited capacity may not be able to use financial instruments the same way middle-income countries can. Small island developing states subject to financial shocks where loss can exceed their annual GDP face vastly different challenges than large middle-income countries trying to smooth public expenditures over time or safeguard low-income populations against disasters.
Bank President Robert Zoellick told an overflowing room of journalists this morning that these annual meetings come at an important time for the work of the Bank Group and its members.
“The G-20 summit last week provided clear markers for the work of the World Bank. But more than 160 countries were not at the G-20 table,” he said. “These meetings can therefore ensure that the voices of the poorest are heard and recognized. This is the G-186.”
Zoellick began his remarks by expressing his sympathy for the people of Indonesia, the Philippines, Samoa and Tonga and others in the region, who have been battered by a series of cataclysmic natural disasters.
The Bank’s President told reporters that developing countries are still suffering from the global economic crisis, and it is important for the G20 to scale up support. He said the meetings offer a platform to follow up on the proposal for a crisis facility for low-income countries—critical to ensuring that protection for the most vulnerable becomes a permanent part of the world’s financial architecture.