Colombia : Policy Strategy for Public Financial Management of Natural Disaster Risk
Disasters resulting from natural hazards represent an important challenge for Colombia’s fiscal sustainability and stability. Colombia is one of the countries with the highest recurrence rate of disasters caused by natural hazards in Latin America...
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| Format: | Report |
| Language: | English en_US |
| Published: |
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2016/10/26880116/colombia-policy-strategy-public-financial-management-natural-disaster-risk http://hdl.handle.net/10986/25288 |
| Summary: | Disasters resulting from natural hazards
represent an important challenge for Colombia’s fiscal
sustainability and stability. Colombia is one of the
countries with the highest recurrence rate of disasters
caused by natural hazards in Latin America (see the Annex)1.
As the country’s population and economy continue to grow, so
will the economic losses resulting from such events, an
average of 600 disaster events of which is reported per
year2. Colombia’s rate of economic growth is increasing the
base of assets exposed to disaster risks, which may lead to
significant increases in losses, particularly if investments
in new assets are not accompanied by plans for mitigating
disaster risk. The Government of Colombia (GoC) recognizes
the importance of mitigating these events and has taken
several steps to mainstream disaster risk management into
its policy and programs, as evinced by the National
Development Plan ‘2014-2018’, ‘all for a New Country’. The
MHCP is committed to developing strategies for reducing its
contingent liabilities in relation to disasters and to
managing the fiscal risk resulting from these events. This
document presents the priority policy objectives that have
been established to assess, reduce, and manage fiscal risk
due to natural disasters. It also describes the MHCP’s
efforts to progress its policy objectives in the long term.
These policy objectives represent the MHCP’s ex ante policy
framework regarding management of financial and fiscal
disaster risk. The MHCP identifies three priority policy
objectives in order to strengthen management of the
Government’s contingent liabilities and thus support the
goal of achieving macroeconomic stability and fiscal
balance. The policy objectives are: (i) identification and
understanding of fiscal risk due to disasters; (ii)
financial management of natural disaster risk, including the
implementation of innovative financial instruments; and
(iii) catastrophe risk insurance for public assets. |
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