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Disasters

Cat DDOs: More than emergency lending for disaster relief

Ede Ijjasz-Vasquez's picture
Disasters can strike anywhere and anytime. As climate change intensifies, extreme weather events, for example, are on the rise around the world, and countries are increasingly seeking to improve both their physical and financial resilience to all kind of disasters. An important dimension of sustainability in urban and rural areas is resilience–resilience for the natural disasters of today and those of tomorrow.   

One way to better prepare for disasters is securing access to financial resources before a disaster strikes through financial instruments such as the Cat DDO. 

Cat DDO stands for “Catastrophe Deferred Drawdown Option.” It is an innovative contingent line of credit that can provide immediate liquidity to countries in the aftermath of a disaster resulting from an adverse natural event. The World Bank has made it available to countries since 2008, to make it possible for them to have quick access to financial resources upon the declaration of state of emergency in the aftermath of a disaster, following an adverse natural event and in accordance with local legislation. The funds that provide liquidity to the countries are preapproved based on a sound disaster risk management program and an adequate macroeconomic framework. 

[Read: Disasters, funds, and policy: Creatively meeting urgent needs and long-term policy goals]

Why are Cat DDOs an important disaster risk financing instrument for countries?
  • It serves as an early financing tool while funds from other sources such as government reallocations, bilateral aid, or reconstruction loans/credits become available.
  • It allows the countries to address the emergency without distracting resources from their social and development programs.
  • It enhances the countries’ financial capacity to prepare for disasters.
  • It also generates or consolidates a dialogue on disaster risk management between the countries and the World Bank to learn from experience and apply good practices.

What are some of the examples of “Cat DDOs in action”? How will this innovative tool evolve to better manage increasing disaster risks? Watch a video with World Bank Senior Director Ede Ijjasz-Vasquez (@Ede_WBG) and Senior Disaster Risk Management Specialist Armando Guzman to learn more. 


 

What do "Sustainable Cities" look like to you? Enter our global photo contest by October 6 (deadline extended to October 15)

Dini Djalal's picture
Also available in: Español | Français | العربية | 中文
Enter our global photo contest by October 15

Building healthy and well-functioning cities and communities that continue to thrive for generations is the goal of the Global Platform for Sustainable Cities (GPSC), a collaboration that unites cities across continents in their endeavors towards achieving sustainable, resilient development.
 
What would these cities and communities look like to you? The GPSC, its partner cities, and the Global Environment Facility (GEF) invite you to articulate sustainability through the medium of photography.


Whether it be elements of your city that represent sustainability, or a moment in time that captures the spirit of inclusive, resilient, and sustainable urban development, we invite you to share your vision with us, through your photographs.
 
The winners of the photo competition will each win exciting prizes: a $500 voucher for purchasing photography equipment, as well as a chance to be recognized at an award ceremony and have their photographs featured in the World Bank / GPSC’s online and print materials.
 
Here’s how the Sustainable Cities Photo Contest will work:

Flooded rivers: taking a bird’s eye view

Zuzana Stanton-Geddes's picture
When a river swells beyond its usual patterns, the impact on its surroundings can be devastating. In 2014, 51 people lost their lives and over 20% of Serbia’s population were affected by floods when eight rivers spilled over their banks. Photo credit: Dusan Milenkovic / Shutterstock.com
Floodplains are attractive areas for development, with over 2 billion people living within the world’s 10 largest river basins. Yet, they are also at particular risk from overflowing rivers. Globally, river floods affect more than 21 million people. By 2030, due to climate change, population growth, and rapid urbanization, this number could rise to 54 million.

Weathering storms in Central America: The impact of hurricanes on poverty and the economy

Oscar A. Ishizawa's picture
Countries are facing increasingly frequent negative impacts from adverse natural events. Central America, a region prone and vulnerable to disasters, is a clear example. Just from 1992 to 2011, Central America was hit by nearly 70 hurricanes with an average of 8 events per year, hindering sustainable economic growth.

Between 2005 and 2014, due to natural disasters, the region had a nominal cumulative loss of around US$5.8 billion, and witnessed more than 3,410 deaths and hundreds of thousands of displaced people. More recently, in October 2011, Tropical Depression 12-E hit the coasts of El Salvador and Guatemala with damages amounting to nearly US$1 billion.

In two recent studies, we evaluated the causal impacts of hurricane windstorms on poverty and income as well as economic activity measured using night lights at the regional and country level. In both cases, we applied a fully probabilistic windstorm model developed in-house, and calibrated and adjusted it for Central America. The first study (on poverty) used yearly information at the household level (for income and poverty measures) as well as the national level (GDP per capita). Due to the limited comparable household data between the countries, we decided to follow up with the second study (on economic activity) using granular data at the highest spatial resolution available (i.e., 1 km2) to understand more deeply the (monthly) impact over time.

Our results are striking:

Why mangroves matter for the resilience of coastal communities

Saurabh Dani's picture

In 2006, I was working in Aceh, Indonesia (with the Red Cross), a region devastated by the 2004 Indian Ocean tsunami. Amongst other post-disaster recovery activities, we were working with 20 coastal communities, helping them with community-managed small grants and encouraging them to invest in disaster resilience within their communities.
 
To my delight, all 20 communities, independently, chose to invest in the restoration of their mangroves that had been completely or partially destroyed by the tsunami. To them, losing their mangroves was like losing their ancestors: Mangroves defended them, provided them with food and a livelihood, and made their coastline beautiful. The mangroves were their pride, and reclaiming the mangroves was of the highest priority for them as a community.

Why should we care about mangroves? Here are a few important reasons:

To build resilient cities, we must treat substandard housing as a life-or-death emergency

Luis Triveno's picture
Also available in: Español | 中文

Resilient housing policies. © World Bank
Why resilient cities need resilient housing.  Download the full version of the slideshow here

The scene is as familiar as it is tragic: A devastating hurricane or earthquake strikes a populated area in a poor country, inflicting a high number of casualties, overwhelming the resources and capacity of rescue teams and hospital emergency rooms. First responders must resort to “triage” – the medical strategy of maximizing the efficient use of existing resources to save lives, while minimizing the number of deaths. 

But if governments could apply triage to substandard housing, medical triage would be a much less frequent occurrence – because in the developing world, it is mainly housing that kills people, not disasters.
 
From the 2017 Global Platform for Disaster Risk Reduction to the 2017 Urban Resilience Summit, practitioners and policymakers have increasingly focused their discussions on how we can boost the resilience of urban areas.

But this is a problem with a well-known solution: Resilient cities require resilient housing.

To make housing more resilient, cities need to focus on two different but complementary angles: upgrading the existing housing stock, where most the poor live, while making sure that new construction is built safe, particularly for natural disasters. After all, if floods or earthquakes do not distinguish between old and new homes, why should policymakers? It is time for resilience to become part of the definition of “decent, affordable, and safe housing.”

 

How can conflict-affected cities become better hosts to refugees? The case of Afghanistan

Ede Ijjasz-Vasquez's picture
Like many other developing countries, Afghanistan is urbanizing rapidly. Today, a quarter of the country’s over 30 million people live in urban areas, with many more moving to cities to find jobs and lead better lives.

Unlike many other places, though, cities in Afghanistan face an added, complex layer of challenge—conflict.

In Afghanistan, conflict is a major driver of migration into cities. Instability in large areas of the country is forcing refugees and internally displaced people into cities—particularly the capital city of Kabul. The thing is: Kabul doesn’t yet have adequate infrastructure and capacity to effectively host these “newcomers.”

What can be done?

To help Afghan cities better address the “3-way challenge” of urbanization, conflict, and forced displacement, the World Bank is working on a series of projects that aim to:
  • Provide basic services to selected—mostly informal—neighborhoods in Kabul, such as roads, sanitation, water, and lighting;
  • Support Kabul to improve its municipal finance management systems;
  • Support the institutional and policy framework for urban development in Afghanistan;
  • Strengthen city planning, management and service delivery in five provincial capital cities.

In this video, you will learn more from World Bank Senior Director Ede Ijjasz-Vasquez (@Ede_WBG) and Practice Manager Catalina Marulanda on how cities and communities in Afghanistan are building up their capacity and resilience to better host refugees and other displaced populations.

Drought-stricken Somalia is at risk of famine (again). How can we help?

Ede Ijjasz-Vasquez's picture
Somalia is on the brink of famine resulting primarily from severe drought. Half of the country’s population – an estimated 6.7 million people – are acutely food insecure and in urgent need of humanitarian assistance. This comes only six years after a famine led to the death of more than a quarter of a million people – half of them were children.
 

Disasters, funds, and policy: Creatively meeting urgent needs and long-term policy goals

Zuzana Stanton-Geddes's picture

Photo: tro-kilinochchi / Flickr

When it comes to responding to disasters, time is of the essence. Help needs to come immediately to save lives; recovery and reconstruction have to start swiftly to lessen the impact.

However, while money is critical to this response, it’s not just about funding. Indeed, funds need to match the event scale, target the right areas and sectors, and smoothly flow to communities in need. But in order for that to happen, sound public policy on risk and frameworks have to be in place.  

To address both urgent financial needs while pursing strategic disaster risk management policy goals, countries have been using the World Bank’s development policy loan with a catastrophe deferred drawdown option or, more widely known as the Cat DDO.  

Three countries show why culture matters for post-conflict and post-disaster reconstruction and recovery

Sameh Wahba's picture
In Mali, residents of Timbuktu take part in the maintenance of the Djingareyber Mosque, a World Heritage Site, applying traditional repair techniques. (Tiecoura Ndaou / UN Photo)
In Mali, residents of Timbuktu take part in the maintenance of the Djingareyber Mosque, a World Heritage Site, applying traditional repair techniques. (Tiecoura Ndaou / UN Photo)

Imagine a city destroyed by a natural disaster, killing people and wiping away infrastructure. For instance, an earthquake devastated Port-au-Prince, Haiti in 2010, killing over 200,000 people and displacing around 895,000.

Even worse, imagine a city demolished by a manmade disaster: conflict. Recent examples include Aleppo, Syria and Kabul, Afghanistan. Here conflict goes far beyond violence to include erasing a place’s culture, heritage, landmarks, and its traditions.

Now, imagine the enormous undertaking required to rebuild these places and the many stakeholders that need to be brought together. It would take an integrated, holistic approach to restore torn heritage, infrastructure, and service delivery systems after they have been wiped out by a natural or manmade disaster. Culture needs to underpin such a rebuilding approach.

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