Kenya will now be better positioned to manage the effects of climate and disaster risks after the World Bank endorsed an International Development Association (IDA) credit of $200 million.
The World Bank’s Disaster Risk Management Development Policy Financing together with Catastrophe Deferred Drawdown Option (Cat DDO) will offer Kenya fast access to funding during a disaster or public health emergency and support the country’s reforms to improve disaster management.
Cat DDO will also back the country’s efforts to improve the regulatory environment as population growth in urban areas threatens to increase the cost of mitigating disasters in the future.
World Bank Country Director for Kenya Diarietou Gaye said:
“We are working closely with the National Treasury in supporting Kenya to address the economic losses triggered by climate-related disasters that often hamper poverty reduction efforts and threaten the numerous advances that Kenya has made in promoting shared prosperity. Extreme climatic events have long threatened development progress in Kenya, where 84 per cent of the land is classified as arid or semi-arid, and where droughts and floods are estimated to cost the economy over two per cent of GDP each year on average.”
World Bank Task Team Leader Eric Dickson stated: “There is a need to implement regulatory reforms to manage the risks associated with the concentration of poor and vulnerable people living in unsafe structures and often in informal settlements. The Cat DDO will support policy reforms that fortify institutional and planning frameworks to strengthen resilience to disaster risks in Kenya.”
Cat DDO will also back the execution of the National Disaster Risk Financing Strategy, the first such strategy in Kenya, which intends to proactively alleviate the long-term effects of disasters and eventually protect the welfare and enhance the resilience of Kenyans.
The National Treasury and the Ministry of Planning will execute the project.
