Disaster Risk Finance is very important in avoiding deterioration of the poverty rating of the country, Philippines' Finance Undersecretary Gil Beltran said yesterday.

“While we are growing at a very fast pace of 7 percent, our poverty rate is not improving that much because just one typhoon would wipe out all the gains from our increasing gross domestic product,” he said, at the Asia-Pacific Economic Cooperation conference in Bacolod City yesterday.

Richard Poulter, a specialist on disaster risk financing and insurance from the World Bank, said the frequency and severity of disasters world-wide is increasing at a rapid rate and Disaster Risk Financing can protect precious development gains and can also protect local governments from having to re-allocate funds for other reported areas such as health and education in the aftermath of a disaster.

During the two-day APEC seminar titled "Disaster Risk Finance - APEC Roadmap for Resilient Economies," a suggestion for the 21 member-economies of APEC to have a regional insurance against disaster risk has been presented.

Poulter said accessing insurance against disasters may be expensive for a single economy, but the cost can be significantly reduced with economies of scale.

He suggested that APEC economies may pool their disaster risks and then tap insurance collectively from an international insurance provider.

"In so many ways the Philippines has been leading efforts toward [disaster] resiliency, and the model it is pursuing is an example," Poulter said.

Regional insurance is one of the proposals for disaster resiliency that APEC member-economies may consider discussing in detail in succeeding meetings.

Other proposals raised were establishment of a catalogue showing risk exposures of member-countries, creation of a platform showing data on insurance coverage of public assets, and engagement of the private sector in disaster risk financing. Meantime, the Philippines reiterated the need for a proactive approach toward enhancing disaster resiliency across APEC member-economies.

Beltran, who serves as head of the overall organizing committee for the APEC gathering in city, said the APEC region serves as a growth driver for the world economy. “Given that the region is prone to natural disasters, collective efforts to boost disaster resiliency are vital in ensuring that our region continues to have significant contributions to global growth," he said.

Besides exploring means for APEC member-economies to access disaster risk financing, participants in the two-day APEC gathering also discussed proposals to widen penetration of microinsurance. Given its affordability, microinsurance is seen as an effective tool to protect more people and enterprises against adverse effects of disasters.

The two-day meeting in Bacolod City was attended by 92 participants from the technical working groups of finance ministries as well as finance experts across the APEC region. Finance ministries across the region will discuss in further detail the proposals raised during the APEC event in Bacolod and decide what may potentially be included in the Cebu Action Plan.*CGS

back to top