Disaster Risk Financing in the Caribbean Region - Framework and Assessments : 360 Degree Resilience Background Paper

The Caribbean Disaster Risk Financing (DRF) framework of the World Bank has been collaboratively designed in partnerships with Caribbean Governments and local and international stakeholders. The framework helps consolidate and preserve physical disaster risk reduction measures in countries by limiting the residual fiscal impacts, caused by the materialization of public contingent liabilities in the wake of a disaster. Most Caribbean countries show strong volatilities in their budgets in the wake of disasters or during a health crisis such as the current Covid-19 pandemic. Their economies have historically lacked enough diversity to be flexible in adapting to rapid and, in some cases, relatively frequent economic shocks caused by disasters. A comprehensive DRF strategy helps alleviate the financial burden of disaster response and, ultimately, ensure the sustainability of public finances