Money in place to deal with impact of natural disasters, says Clarke
MINISTER of Finance and Planning Dr Nigel Clarke has indicated that the Government has access to funds for addressing emergencies in the event that the island is badly affected by a natural disaster.
Clarke gave the assurance on Wednesday in the wake of the scare to the country from the 5.6-magnitude earthquake which shook much of the island on Monday.
Addressing the 54th Annual Monetary Studies (AMS) Conference at the Bank of Jamaica’s auditorium in downtown Kingston, Clarke said the Government has put in place measures for the adequate funding of emergency costs associated with natural disasters.
According to Clarke, the suite of products is essential to the country’s disaster framework and enables the Government to respond to multi-billion-dollar emergency costs associated with natural disasters.
“We have a natural disaster fund, we have a contingency fund, and together they have about $5 billion. We have a credit contingent claim with the IDB [Inter-American Development Bank] for over US$285 million, that’s over $40 billion,” said Clarke.
“We have the Caribbean Catastrophe Risk Insurance Facility, which provides limited coverage for earthquake, excess rainfall, and we have something for tropical cyclones, and then, on top of that, Jamaica became the first small island State in the world to independently sponsor a catastrophe bond, which is US$185 million or approximately $30 billion,” added Clarke.
He said the earthquake that impacted the island on Monday brought home the need for Jamaica to make sure that it does not wait for a disaster to start planning how the country will finance the emergency costs that come out of it.
According to Clarke, the multi-layered approach, involving significant resources and pioneered by the Government, helps to ensure that the country can finance emergency costs associated with natural disasters.
“Those are the costs that you can’t defray, the ones that can take a fiscal programme off track because you have no choice but to address them. What we want to do in our disaster framework is to have financial products that give the Government the capacity to respond to emergency costs of natural disasters, and Jamaica is pioneering that in the region, indeed in the world, by having a suite of products that can increase the capacity of the Government,” said Clarke.
“We must include other products and we must continue to capitalise our natural disaster fund and our contingency fund to ensure that Jamaica is not left to the mercy of donors after the fact, in the event of a natural disaster,” Clarke added.