Colombia Builds Resilience to Natural Disasters and Public-Health Emergencies with IDB Support

The Inter-American Development Bank (IDB) has approved a $400 million contingent loan to support Colombia by bolstering its financial resilience to natural disasters and public-health emergencies.

The loan, which was approved by the Bank's Board of Executive Directors through the Contingent Credit Facility for Natural-Disaster and Public-Health Emergencies (CCF), will allow the country to quickly access resources in these types of events. It will finance an immediate response for victims, helping to soften the impact on the country’s public finances and lay the groundwork for a swift and sustainable recovery.

“This program is Colombia’s first CCF contingent loan with the IDB. It reflects the country’s commitment to continue building its resilience to natural disasters and the IDB’s work to promote innovative financial solutions that enhance disaster-risk management in Colombia,” explained Ramiro López-Ghio, IDB representative in Colombia.

Colombia is vulnerable to natural threats, such as earthquakes, floods, volcanic eruptions, droughts, tsunamis, and forest fires. Since 1990, the country has experienced 163 extreme events affecting over 13 million people and causing billions of dollars in losses.

The program includes providing humanitarian aid, restoring utilities, and quickly repairing critical infrastructure, among other immediate responses.

When paired with a technical assistance program, this operation will help improve the country’s comprehensive disaster-risk management in five strategic areas: governability, identifying and understanding risks, adaptation and reducing disaster risk, readiness and response, and financial protection.

If funds are disbursed for a qualifying event, the loan will have a 25-year repayment term, a 5.5-year grace period, and an interest rate based on the Secured Overnight Financing Rate (SOFR).