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The ongoing pandemic is worsening in many parts of the world, raising concerns over potentially compounding shocks as natural disasters continue to threaten vulnerable communities.

COVID-19 has already increased countries’ vulnerability to disasters and reduced their capacity for dealing with shocks, while also placing a heavy burden on national health care and social protection systems. This has left governments, businesses, and families with little or no buffer to protect against additional shocks, such as earthquakes, cyclones, drought, and more.

GRiF is doing its part by providing grants to World Bank teams that are enabling governments to pre-arrange finance for climate shocks, disasters, and crises complementing IDA efforts that prioritizing emergency response and recovery from the COVID-19 outbreak. Financial planning for future crises is more important now than ever before, where countries all over the globe are grappling with low economic growth, overstretched budgets, and reduced humanitarian assistance for future crises.
VIRTUAL HIGHLIGHTS
Five Reasons the Global Risk Financing Facility Is Relevant During an Ongoing Pandemic

Natural disasters will not stop during COVID-19, and neither should financial planning for them. Now, in the wake of the COVID-19 pandemic, financial planning for compound risks is more important than ever. As the World Bank continues its pandemic response and recovery efforts, GRiF is ready to work with teams that are looking to plan today for additional risks that may materialize tomorrow. Such efforts will ensure that—even though health systems and economies are taxed—there will still be support for vulnerable countries, businesses, and families when future disasters strike. 

Read the full blog here.
The Perfect Storm: How to Prepare against Climate Risk and Disaster Shocks in the Time of COVID-19

As governments tackle the COVID-19 recovery, broader institutional reforms should build shock-responsive systems for the future. The time is now to boost financial preparedness to climate risks and disasters, and leadership by finance ministers can enable institutional reforms to establish a whole-of-government approach to planning, financing, and establishing shock-responsive systems.

Read the commentary originally published in One Earth here.
 
Guiding Principles and Appraisal Framework for GRiF Grant Support

The use of grant financing to support disaster risk finance and insurance solutions is a complex, sensitive and evolving area of work, with a limited track record. Development partners should therefore adopt a flexible, evidence-based approach to implementation that enables adjustments over time to refine operational modalities and manage risks. The note below presents a set of guiding principles and appraisal criteria to guide resource allocation decisions for the GRiF at the portfolio level and appraise funding proposals for grant support to disaster risk finance and insurance instruments at the project/product level.

Read the full note here.
PROJECT IN FOCUS: MALAWI
Malawi’s economy and the wellbeing of its people are highly vulnerable to climate change and variability, with over 80% of the labor force employed in the agricultural sector and 70 percent living below the international poverty line. From 1990 to 2018, 21 flooding events affected more than 2.7 million people, while 7 drought events affected in excess of 27 million people.

To help address these risks, the $125 million World Bank Malawi Social Support for Resilient Livelihoods Project (MSSRLP) seeks to improve resilience among the poor and vulnerable population and strengthen the national platform for safety nets. GRiF is co-financing the project, which will design a shock-responsive social protection system, that will offer cash transfers after smaller events through contingent IDA funds held in the project as well as after larger events by way of a risk transfer instrument financed by the GRiF grant.

GRiF has provided a total grant of $21 million, of which US$10 will be used to finance premiums for a risk transfer instrument, while the balance will enable design and development of the shock-responsive social protection system – one that is transparent and accountable and embedded within national delivery systems. These efforts complement ongoing in-country initiatives to improve the effectiveness of cash transfers, including efforts under the Learning Task Force on Shock Sensitive Safety Nets, co-founded by UNICEF, World Bank and Government of Malawi, and actively supported by the World Food Programme and other organizations.
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Related: Financial Protection Forum | Fundamentals of DRF E-learning | GFDRR 
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