Swiss Embassy, ADB sign agreement to support National Disaster Risk Management Fund

Press release, 16.07.2018

Islamabad: The Embassy of Switzerland in Pakistan and the Asian Development Bank (ADB) signed an agreement on Monday to support the National Disaster Risk Management Fund (NDRMF), recently established by the Government of Pakistan to finance investments in disaster risk reduction and preparedness that have high economic impact.

Asian Development Bank's Country Director Xiaohong Yang and Head of International Cooperation, Embassy of Switzerland in Pakistan, Stefanie Burri exchanging the document. © Asian Development Bank

Under this agreement, the Swiss Agency for Development and Cooperation (SDC) will provide 1.5 million Swiss Francs (equivalent to USD1.5 million) to the Fund. In addition, the SDC will also provide technical assistance to the Fund through secondment of a Disaster Risk Finance Specialist.

The Ambassador of Switzerland to Pakistan Thomas Kolly and SDC officials from Switzerland attended the exchange of documents between ADB Country Director Xiaohong Yang and Stefanie Burri, Head of International Cooperation, Embassy of Switzerland in Pakistan. SDC officials from Switzerland included Sabine Rosenthaler Sherman, Desk Officer for Pakistan, Humanitarian Aid at SDC, Frank Wiederkehr, Desk Officer for Pakistan and Jean-Luc Bernasconi, Head of Division Europe, Asia and the Americas, Swiss Humanitarian Aid at SDC.

ADB, building on Pakistan earthquake and flood reconstruction experience, has been working with the Government of Pakistan and other development partners to develop a financing window to reduce disasters risks and increase capacity of the government to deal with future challenges. The efforts resulted in the establishment of the multi-donor NDRMF with an initial contribution of USD200 million to reduce socioeconomic and fiscal vulnerability to natural hazards.

Pakistan remains a disaster-prone country with frequent floods and other disasters caused by climate change. In the last one and half decade, Pakistan lost 85,000 lives, including more than 26,000 children, and suffered substantial economic losses due to various disasters. The affected people had limited capacity and resources to recover. The Fund was established to close the resource gap not only in the aftermath of disasters but also make investments in projects meant to mitigate the risk of disasters.

NDRMF is a not-for-profit company incorporated with the Securities and Exchange Commission of Pakistan under Section 42 of the Companies Ordinance 1984. It is a government-owned non-banking financial intermediary with a corporate structure. The Fund will finance up to 70 percent of the cost of eligible projects that will enhance Pakistan’s resilience to extreme weather events and other natural hazards.

Switzerland has been working closely with disaster management authorities at the national, KP and former FATA levels to prevent disasters in Pakistan’s most vulnerable areas. A successful example is a project in Chail Valley in District Swat where, after the flood of 2010, local people were involved to build stonewalls, stabilize slopes through plantation, using rocks or timber to reduce the risk of disasters in their area. The intervention was so effective in mitigating the impact of extreme weather events on local communities that the SDC, on request of the Government of Pakistan, is supporting the replication of this model in Bajaur, Mohmand and Orakzai Districts in collaboration with Fata Disaster Management Authority (FDMA), WFP and HUJRA.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region. In 2017, ADB operations totaled $32.2 billion, including $11.9 billion in co-financing.