World Bank provides $500-million fund for Phl disaster preparedness plan

MANILA, Philippines - The World Bank has opened a $500-million credit line for the Philippines to help the country improve its natural disaster preparedness program.

The Disaster Risk Management Development Policy Loan with Catastrophe Deferred Drawdown Option (CAT-DDO) will allow immediate access to funding for emergency relief, recovery, and reconstruction efforts following a major natural disaster.

The Philippines is ranked among the most vulnerable countries in the world to natural disasters. On average, more than 1,000 lives are lost every year, with typhoons accounting for 74 percent of fatalities, 62 percent of total damages, and 70 percent of agricultural damages.

The World Bank said the CAT-DDO is in support of the country’s integrated framework for disaster risk reduction and management enshrined in Republic Act 10121 or the Disaster Risk Reduction and Management (DRRM) Act and the Strategic National Action Plan for Disaster Risk Reduction (SNAP) crafted in 2010.

Drawdown from this new financing support will be triggered when the President declares a “state of calamity.”

RA 10121 defines a state of calamity as a condition involving mass casualty and/or major damages to property, disruption of means of livelihoods, roads and normal way of life of people in the affected areas as a result of the occurrence of natural or human-induced hazard.

This operation gives the country flexibility to use the funds only if needed. The drawdown period is three years and renewable up to four times for a total of 15 years.

In 2009, Tropical Storm Ondoy (international code name Ketsana) and Typhoon Pepeng (Parma) hit Luzon, including Metro Manila, costing the Philippines’ economy around 2.7 percent of its gross domestic product (GDP) and increased the number of poor people by about 500,000.

In response, the Philippines enacted the DRRM Act and adopted the SNAP, effectively institutionalizing a comprehensive and integrated approach to disaster risk reduction and management in the country.

World Bank country director Bert Hofman said the Philippines has drawn up a comprehensive framework for managing the impact of natural disasters and has incorporated it in the country’s overall development strategy.

“The poor are among the most at risk from natural disasters. Reducing their vulnerability to disasters forms an important part of our assistance strategy for the country,” Hofman added.

According to the National Disaster Risk Reduction and Management Council (NDRRMC), between 1990 and 2008, the country incurred average annual direct damages to agriculture, infrastructure and the private sector of around P28 billion, which is equivalent to about 0.7 percent of GDP. Damage to agriculture alone averaged P12.4 billion annually.