To meet the challenges of severe economic disruptions caused by global weather disruptions, hurricanes and earthquakes, the Inter-American Development Bank during 1999 accelerated its programs to assist Latin America and the Caribbean in its efforts for recovery and reconstruction from natural disasters.

The IDB chaired the May 1999 conference in Stockholm of the Consultative Group for the Reconstruction and Transformation of Central America in which donors pledged $9 billion over the next five years for recovery efforts in El Salvador, Honduras, Guatemala, and Nicaragua % the four countries that suffered most from the storm.

Of that amount, the IDB alone is committed to providing $3.5 billion in financial assistance.

The Bank approved $59 million in concessional loans during 1999 for disaster-related assistance, including financing for emergency road and water supply, post-hurricane housing, and protection and improvement of social programs. A $1 million IDB grant will support preinvestment studies and managerial strengthening for the reconstruction effort.

Nicaragua received an IDB loan of $50 million to finance repairs along the northern sections of the Pan American Highway damaged by Hurricane Mitch, as well as to establish a special fund for ongoing road maintenance.

An IDB loan of $21.3 million was approved for Belize for hurricane rehabilitation and disaster preparedness.

After Colombia’s coffee-producing region was hit by a severe earthquake on Jan. 25, 1999, the IDB processed a loan of $20 million in a record 25 days to support recovery and reconstruction. The loan was processed through a special, fast-track procedure approved by the Board of Executive Directors.

That assistance was followed by an investment program of $133.7 million, financed by redirecting undisbursed balances from previous IDB loans to Colombia.

Peru received a $120 million IDB loan to continue reconstruction efforts from the devastation of El Niño, the abnormal weather pattern that caused severe flooding in 1997 and 1998. This financing supplements a $150 million IDB loan to Peru in 1997 for supporting efforts at recovery and reconstruction.

The destructive El Niño phenomenon was followed in 1999 by La Niña, a related climate irregularity that also causes devastation, such as heavy flooding and drought, but, since this phenomenon represents an ocean cooling rather than a warming, its effects are the opposite of El Niño in various countries.

The IDB is responding to Venezuela’s disastrous heavy rainfall in late 1999 % which caused widespread flooding, landslides, damage, and death % by reformulating $170 million in previously approved loans to redirect resources to relief and reconstruction.

The Bank is supplementing this effort by preparing a new loan of $20 million to support Venezuela’s efforts to cope with the disaster and another, much larger loan, for an amount yet to be determined, scheduled to be presented to the Board of Executive Directors during 2000.