World Bank (WB) has committed to providing USD 14.8 million (M) to help Bhutan carry out comprehensive reforms to manage climate and disasters risks, including disease outbreaks.
Finance Minister Namgay Tshering and WB’s acting country representative Tenzin Lhaden signed the agreement yesterday in Thimphu.
This agreement is a development policy financing with Catastrophe Deferred Drawdown Option (Cat DDO).
According to a press release from the WB, the reform programme supported by the Cat DDO operation can be implemented under two pillars.
The first pillar focuses on integrating climate and disaster resilience to build environment and the other one is on strengthening Bhutan’s institutional and technical capacity for emergency preparedness and response.
“The World Bank operation will provide dedicated contingent financing to support the government to respond to imminent or occurring natural disasters, including a public-health emergency event,” stated the WB’s press release.
The press release also mentioned that the Cat DDO funds might be drawn in the case of a natural disaster, including a public health outbreak. “The line of credit would be available to be partially or fully drawn down at any time within the next three years and can be renewed for an additional three years for a total of six years.”
Last month, the government and the WB signed a USD 40M budget support loan agreement to help Bhutan undertake a comprehensive reform programme to enhance its fiscal management and realise its development goals.
USD 5M agreement was also signed last month between the government and the WB to help prevent, detect, and respond to the Covid-19 pandemic and strengthen the country’s public health preparedness.