1. IDB Draft Disaster Risk Management Policy 0 Bruce Juba Representative Country Office Barbados Inter-American Development Bank Comprehensive Disaster Management Strategy Meeting Barbados, March 20-21, 2006

2. The need to reduce disaster risk Costs of disaster recovery outpace average economic growth for most countries in Latin America and the Caribbean. Natural hazards now pose an important challenge to sustainable development. Costs of disaster recovery outpace average economic growth for most countries in Latin America and the Caribbean. Natural hazards now pose an important challenge to sustainable development. During the past thirty years disasters in the region have annually affected 4 million people, causing some 5,000 deaths and US$3.2 billion in physical losses. During the past thirty years disasters in the region have annually affected 4 million people, causing some 5,000 deaths and US$3.2 billion in physical losses. The IDB is committed to contribute to the reduction of these losses through cooperation with its borrowing member countries. The IDB is committed to contribute to the reduction of these losses through cooperation with its borrowing member countries.

3. A Bank policy lays out binding rules for what the Bank can and cannot do. It is drafted in general terms containing principles guiding Bank action. A Bank policy lays out binding rules for what the Bank can and cannot do. It is drafted in general terms containing principles guiding Bank action. Context of an IDB policy Disaster Risk Managment Policy Action Plan Supports the implemtation of the policy LoansTechnical Assistance Programming Process

4. Process of elaborating the policy This draft Policy (December 21, 2005) reflects comments received in the first round of consultation and subsequent discussions in the Bank. This draft Policy (December 21, 2005) reflects comments received in the first round of consultation and subsequent discussions in the Bank. The draft policy is subject to review and revision by Upper Management and the Board and is expected to be presented for consideration by the Board of Directors by the end of 2006. The draft policy is subject to review and revision by Upper Management and the Board and is expected to be presented for consideration by the Board of Directors by the end of 2006.

5. Objectives of the Policy To explicitly acknowledge disaster risk as a development challenge, when warranted, and include activities to address this challenge in the country strategy agreed between the Bank and the country. To explicitly acknowledge disaster risk as a development challenge, when warranted, and include activities to address this challenge in the country strategy agreed between the Bank and the country. To integrate disaster risk management in the project cycle. To integrate disaster risk management in the project cycle. To facilitate rapid and adequate assistance by the Bank to borrowing member countries in response to disasters for efficient revitalization of their development efforts. To facilitate rapid and adequate assistance by the Bank to borrowing member countries in response to disasters for efficient revitalization of their development efforts.

6. The five directives A1: Programming A1: Programming A2: Project viability A2: Project viability B1: Reformulation of Loans after a disaster B1: Reformulation of Loans after a disaster B2: Reconstruction B2: Reconstruction B3: Humanitarian Aid B3: Humanitarian Aid

7. A-1: Dialogue with the borrower The draft policy seeks to incorporate risk reduction in Bank/Country programming dialogue in a three step process: The draft policy seeks to incorporate risk reduction in Bank/Country programming dialogue in a three step process: 1.Identify countries at high exposure to natural hazards 2.Identify specific potential vulnerabilities that pose major development challenges for the country 3.Encourage inclusion of disaster risk reduction measures in the country strategies with the Bank

8. A-2: Risk reduction in project preparation The draft policy seeks to incorporate risk reduction in Bank financed projects with a three step process: The draft policy seeks to incorporate risk reduction in Bank financed projects with a three step process: 1.Identify highly exposed projects 2.Conduct a natural hazard risk assessment – including assessing institutional capacities to cope with risks - for highly exposed projects 3.Where significant risk is identified, include risk mitigation measures to ensure project viability.

9. B-1: Loan Reformulation After a disaster the Bank can accommodate a country’s request to restructure existing loans to meet urgent needs for reconstruction, if: After a disaster the Bank can accommodate a country’s request to restructure existing loans to meet urgent needs for reconstruction, if: –A state of emergency has been declared; and

10. –Opportunity costs for the development objectives of the original loan have been evaluated and taken into account; –The use of the redirected funds will be sufficiently transparent; –A significant share of the redirected funds will be applied to reduce vulnerability to future disasters;

11. B-2: Reconstruction The Bank can finance rehabilitation and reconstruction after a disaster. The Bank can finance rehabilitation and reconstruction after a disaster. When doing so it must take special precautions to avoid rebuilding vulnerabilities. When doing so it must take special precautions to avoid rebuilding vulnerabilities.

12. B-3 Humanitarian assistance The Bank makes available a limited amount of grant resources that can be disbursed for humanitarian assistance within 24 hours of a declared emergency. The Bank makes available a limited amount of grant resources that can be disbursed for humanitarian assistance within 24 hours of a declared emergency. However the capacity of the Bank is mostly aligned to assist in managing risk before a disaster and in rehabilitating the development after a disaster. However the capacity of the Bank is mostly aligned to assist in managing risk before a disaster and in rehabilitating the development after a disaster.

13. Implementation of the policy Upon approval of the policy by the Board of Directors the Bank will: Upon approval of the policy by the Board of Directors the Bank will: – develop operational guidelines for its application –train Bank staff to ensure efficient implementation of the policy.

14. To comment further on the draft: The current consultation will last until April 26, 2006. The draft policy is available for comments at: http://www.iadb.org/sds/ENV/site_2970_e.htm The current consultation will last until April 26, 2006. The draft policy is available for comments at: http://www.iadb.org/sds/ENV/site_2970_e.htm http://www.iadb.org/sds/ENV/site_2970_e.htm Send comments to the attention of: Send comments to the attention of: Mr. Niels Holm-Nielsen Email: nielshn@iadb.org nielshn@iadb.org

15. IDB Draft Disaster Risk Management Policy Comprehensive Disaster Management Strategy Meeting Barbados. March 20-21, 2006 Barbados. March 20-21, 2006 Bruce Juba Representative Country Office Barbados Inter-American Development Bank