Philippines Third Disaster Risk Management Development Policy Loan

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The Philippines is highly vulnerable to adverse natural events that creates risk to its recent achievements in poverty reduction and can negatively affect economic growth and debt sustainability. Across its 7,641 islands, the Philippines is exposed to multiple natural hazards including typhoons, earthquakes, flooding, storm surges, tsunamis, volcanic eruptions and landslides. Close to 74 percent of the population is vulnerable to natural disasters and 60 percent of total land area is exposed to multiple hazards. Over the past decade, the World Bank (WB) has actively supported the Government’s Reform Program through a series of lending operation and analytical work. The Bank engagement on Disaster Risk Management (DRM) commenced with a first Disaster Risk Management Development Policy Loan (DPL) with a Catastrophe Deferred Drawdown Option (CAT-DDO) in 2011. This was the first of its kind for the Asia-Pacific region. The operation was accompanied by a comprehensive technical assistance (TA) program that supported the implementation of the Philippine Disaster Risk Reduction and Management Act. The TA contributed to the creation of DRRM offices at the local level and helped build capacity of the Office of Civil Defense (OCD) and key agencies in integrating disaster risk reduction measures, as well as tracking the use of the DRRM funds. The program also supported the Department of Finance (DOF) in developing a National Disaster Risk Financing and Insurance (DRFI) strategy. In 2015, CAT-DDO2 was approved with a dual objective to: (i) strengthen risk reduction investment planning and regulations and; (ii) enhance the financial capacity to manage disaster risk. TA supported its complex reforms focused on developing tools to enhance the socioeconomic resilience of provinces for better planning and investment programming, improving the outdated national building regulations to include disaster risk reduction and climate resilience measures, and strengthening financial preparedness to disasters. The loan was fully drawn down in 2018 following Tropical cyclone Mangkhut.