The Inter-American Development Bank (IDB) is providing a US$285 million contingent loan to Jamaica to help the island bolster its response efforts to natural disasters and help protect its public purse.
On Wednesday, the Washington-based financial institution said the financing allows Jamaica to pay for “any extraordinary public expenses that could arise from emergencies caused by natural disasters.
“The loan is intended to buffer the financial shock of a disaster on the Jamaica’s fiscal balance, thereby, increasing the nation’s financial stability and efficiency, as well as its disaster preparedness and response,” it said.
Ranks 19th globally for exposure to natural disasters
With a population of more than 2.7 million, the IDB said Jamaica ranks 19th in the world for its exposure to natural disasters, which include hurricanes, earthquakes and droughts.
Between 1988 and 2012, the IDB said 11 named storms made landfall in Jamaica. It’s estimated that hurricane Gilbert cost Jamaica 28 percent of its gross domestic product (GDP), the IDB said.
More frequent intense weather events expected
“As the effects of climate change intensify, Jamaica can expect extreme weather events to become more frequent and more intense, resulting in greater impacts on the environment, economy and population,” it said.
The IDB noted that Moody’s financial rating service lists Jamaica as among the four most vulnerable small-island countries, “when it comes to the credit implications of climate change.”