World Bank launches Global Shield facility for developing countries
The World Bank Group has announced a Global Shield Financing Facility to help developing countries, including those in the Caribbean, access more financing for recovery from natural disasters and climate shocks.
The Washington-based bank said the facility would support the Global Shield Against Climate Risks, a joint initiative launched at the ongoing COP27 United Nations Climate Change Conference on Monday in Egypt “to better protect poor and vulnerable people from disasters by pre-arranging more financing before disasters strike”.
World Bank Managing Director of Operations Axel van Trotsenburg said that by 2040, it’s estimated that over 130 million people could be pushed into extreme poverty by climate change.
“Access to disaster risk finance and insurance solutions for low-income countries is part of the World Bank’s strategy for helping them adapt to the growing risks of natural disasters. We will contribute to the Global Shield initiative through our analytical and advisory work, policy dialogue and country lending operations,” van Trotsenburg added.
The World Bank said the Global Shield Financing Facility will channel grants to developing countries through World Bank projects or through projects prepared by other participating partners, including UN agencies and multilateral development banks.
It will also work closely with key stakeholders, such as civil society organisations, risk pools, private-sector and humanitarian partners, the World Bank said.
Global Shield will provide “coordinated and consolidated financial support” to countries vulnerable to climate shocks and disasters, and will complement investments in climate adaptation and disaster risk reduction.
Such packages will also enable and mobilise private capital for improved financial resilience, by offering private financial solutions, including insurance and other risk-transfer instruments such as catastrophe bonds, the World Bank said.
It added that the Global Shield Financing Facility builds on the earlier Global Risk Financing Facility, established in 2018, which has supported country operations in Africa, Asia, and small island developing states, or SIDS, such as those in the Caribbean.
The programme has been paired with US$3 billion in World Bank lending and has helped to mobilise more than US$1 billion in private-sector capital, the bank said
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