ST. GEORGE’S, Grenada, Feb 14, CMC – Caribbean countries have been told they need to focus their efforts on improving project planning and implementation capacity in light of the risks posed by natural disasters and the intensification of climate change.
Deputy Managing Director of the International Monetary Fund (IMF), Tao Zhang, said grant financing, “remains small compared to the needs” of the region. He said that the focus of donors should also shift from supporting recovery to supporting preparedness.
Zhang, who arrived here as part of a visit to the Caribbean, said preparing for a disaster can make a huge difference” since it is more effective than responding after the event.
“Preparation not only reduces the immediate impact. Our research shows that, over time, it helps boost growth and private investment and reduce emigration and brain drain.”
Prime Minister, Dr. Keith Mitchell said “as a small island developing state vulnerable to the effects of climate change, it is important for us to accelerate climate-smart development policies and programmes, by increasing our investment in climate-resilient infrastructure”
He said Grenada has taken the lead in some respects as it relates to building resilience.
““With the lessons learnt from the devastating impact of Hurricane Ivan in 2004, Grenada has become a regional frontrunner in building resilience to climate change and natural disasters.
“Our efforts to successfully incorporate disaster relief provisions into some of our loan instruments are well documented and serve as a model to be emulated by others,” Mitchell added.
Zhang said most Caribbean countries can do much more in terms of developing resilient public infrastructure and protecting key sectors of the economy, stating that “that’s why a comprehensive approach, or Disaster Resilience Strategy, as we call it, to address climate-related issues is so important”.
The IMF official, who earlier this week visited Dominica, said that Grenada’s strategy would take stock of ongoing efforts to cope with natural disasters, prioritize actions, build consensus across all stakeholders, and anchor progress in upgrading capacity.
“A crucial goal would be to work toward long-term economic sustainability,” he said, noting that the strategy would start from a realistic assessment of the economic impact of climate-related risks and desirable policy responses.
He said policymakers also need to integrate these assessments and policies explicitly into their operational plans, including budget policies, adding that this strategy should be fully financed for a long multi-year period.
Additionally, Zhang said the comprehensive strategy requires policy responses to be practical.
In this regard, he identified three pillars: More investment in emergency preparedness and response; emphasis on resilient physical and social infrastructure; and steps to ensure financial resilience will be crucial.
Zhang said more investment in emergency preparedness and response should involve early warning systems, shelter and security, and distribution of essential goods and services.
On resilient physical and social infrastructure, he said there are several practical steps that can help reduce the risks posed by future storms, such as investing in disaster-resilient infrastructure, enforcing land-use and zoning rules to limit deforestation and coastal exposure, and ensuring appropriate building standards.
Zhang said steps to ensure financial resilience should include insurance mechanisms and cash reserves “that allow disaster preparation and post-disaster response to progress swiftly and effectively.”
For this strategy to be carried out in practice in the region, he urged stronger government efforts, particularly in upgrading budgeting and project execution capacity.
The IMF official said it would also involve maintenance of strong fiscal discipline and acceleration of progress in reforms “to rationalize and improve efficiency of all public spending.
“This would greatly support the countries’ credibility with the international community,” he said.
At the recent joint IMF/World Bank/Inter-American Development Bank (IDB) high-level conference on building resilience in the Caribbean, Zhang noted that many leaders voiced their support for “building an alliance” among key stakeholders.
He said while there is a need for regional coordination, international development partners could offer help in formulating and implementing “a comprehensive and integrated resilience strategy, thereby addressing the resource and implementation capacity issues that all small countries face.
“We see a clear case for coordinating the work of the IMF, the World Bank, multilateral development banks, bilateral partners, insurance companies, the climate funds and business,” he said, adding that the Washington-based financial institution would contribute to the resilience strategy in a number of areas.
“We could help the countries develop an appropriate macroeconomic policy-framework. One way to accomplish this is with a new analytical tool jointly developed with the World Bank.
“This so-called Climate Change Policy Assessment provides a big-picture assessment of a country’s policy response to climate change. It takes into account the macroeconomic, fiscal, and other policy requirements and identifies key areas for improvement.”