Nepal sign $150m World Bank emergency financing agreement

Nepal and the World Bank (WB) signed a $150 million (NPR 20 billion) financing agreement on October 23 for emergency situations like natural disasters or health crises, according to the lender’s statement on Tuesday.

The Nepal Disaster Resilience Development Policy Credit with Catastrophe Deferred Drawdown Option (Cat DDO) operation aims to enhance disaster resilience through policy and regulatory reforms.

It supports the government in improving early warning communications, developing policies, institutions, and regulatory frameworks for risk reduction and investment in critical infrastructure, and boosting preparedness for public health emergencies.

The Cat DDO will improve the country’s crisis preparedness, prevention, and response with immediate and flexible liquidity, especially during fiscal challenges, said Ram Prasad Ghimire, Secretary of the Ministry of Finance.

Cat DDO provides additional financial support to the government’s existing response mechanisms like the National Disaster Management Fund and the Prime Minister’s Disaster Relief Fund.

The operation receives technical assistance from GFDRR and the Earthquake Housing Reconstruction Multi-Donor Trust Fund, supported by the Canadian government, USAID, FCDO, and SDC.

“The Cat DDO is an innovative disaster risk financing instrument that can help the government respond quickly to emergency needs without diverting resources from its ongoing development programmes,” David Sislen, World Bank Regional Country Director for Maldives, Nepal, and Sri Lanka, said.

“Beyond providing financing, the operation is designed to ensure results on the ground and further strengthen the capacity of the government in disaster risk mitigation, preparedness, response, and recovery.”

Attribution: The World Bank report

Subediting: Y.Yasser