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Are we ready?

The IDB has proposed an action plan that would help Latin America and the Caribbean countries improve preparation for natural disasters before they happen.

The plan, which was presented at a seminar on natural disasters held during the Bank’s annual meeting in New Orleans, would incorporate risk management in the financial operations of the Bank by applying prevention and mitigation concepts and evaluating vulnerability and social and environmental impacts.

The plan was drafted after the Bank adopted a disaster prevention strategy in March 1999. In the past four years the IDB has approved $1.5 billion in loans for natural disaster prevention and reconstruction.

As part of the plan, the Bank will help establish information networks and strategic alliances with other international organizations, scientific institutions, and nongovernmental organizations.

The IDB is also proposing new financing to address natural disasters. For example, the Bank, together with bilateral donors, would provide grants to the poorest countries to study the risks of investing in specific disaster-prone areas and sectors. Grants would also help develop policy frameworks for preventing and responding to disasters. In another proposed action, each country would receive up to $10 million annually in loans to reform natural disaster prevention systems, strengthen risk management, and create natural disaster insurance programs.

At the seminar, Honduran President Carlos Flores expressed support for a comprehensive regional action plan. “To prevent rather than to regret should be the slogan to unite us,” said Flores. Honduras was the country most affected by Hurricane Mitch in 1998.

Belize Prime Minister Said Musa recommended that the donor community establish regional centers of attention for disasters to prevent international humanitarian aid from arriving too late in affected areas. Belize, with support of the IDB, is establishing its first national office to manage emergencies.

Prime Minister Owen S. Arthur of Barbados said that natural disasters are costing countries more than mistakes in public policy or turbulence in financial markets. He said the development of new financial instruments, such as insurance against disasters, should be considered immediately.

Mexican Secretary of Social Development Carlos M. Jarque gave a detailed description of the disaster prevention and response systems that his country developed following the tragic earthquake that hit Mexico City in 1985. The Mexican model includes risk insurance, temporary work programs to rehabilitate roads, subsidies for construction of homes and a detailed map of risk areas.

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