New fund for climate and disaster shocks

The announcement of the new fund was made at the Annual Meetings of the International Monetary Fund (IMF) and the Boards of Governors of the World Bank Group in Bali, Indonesia. According to the World Bank, the new fund has been named Global Risk Financing Facility (GRiF). It has received contributions from Germany and the UK. Over the next five years, the GRiF will provide financing to set up mechanisms such as national disaster insurance programs that can help channel money to people affected by disasters when they need it. The GRiF will also provide technical assistance to develop, test, scale-up, and improve financial solutions. In 2017, disasters caused over 300 billion US dollars in losses globally which is the second highest yearly figure ever recorded. Governments of vulnerable countries have to bear the burden of these costs. The poorest are not only more vulnerable and exposed to immediate impacts but also face long-term impacts on their development prospects.