Due to the economic impact of natural disasters on the Public and Private sectors, the Coordination Center for Natural Disaster Prevention in Central America and the Dominican Republic (Centro de Coordinación para la Prevención de los Desastres en América Central y República Dominicana CEPREDENAC) and the Central American Integration System (SICA) held a Forum on financial tools for Disaster Risk Management (DRM), on December 18, 2020 in Guatemala City.
ICC participated in the forum with the intervention of the General Director Dr. Alex Guerra Noriega, who shared the importance of business resilience, stating that the contribution of public-private partnerships in the scientific field is key to understanding threats as a starting point for disaster risk management.
Sovereign protection against risks in Central America and the Caribbean
Central America and the Caribbean are considered natural paradises rich in cultural diversity. Nevertheless, the region faces constant threats from tropical storms, earthquakes and torrential rains, among others.
During the event it was mentioned that governments need a considerable amount of financial resources to be able to respond to the disasters. In the majority of cases the demand exceeds the government’s capacity to mobilize internal and external resources in response to the emergencies.
The Council of Finance or Estate Ministers of Central America, Panama and the Dominican Republic (Consejo de Ministros de Hacienda o Finanzas de Centroamérica, Panamá y República Dominicana (COSEFIN), announced that 24 adverse events such as earthquakes, tropical storms and devastating floods, took place in Central America between 1970 and 2010; they generated damages and losses of more than 30 billion dollars. Extreme climatic events caused 64% of these damages and losses, whereas earthquakes caused 36% of them.
The impact that disasters have on infrastructure and the production of goods and services, can waken macroeconomic and fiscal performance and consequently the ability of the Government to guarantee the well-being of the population.
How to meet these challenges?
The Executive Secretary of COSEFIN, explains that an option to face and meet the challenges of the region is to implement instruments of financial protection against disasters that may provide access to liquidity in a timely and cost-efficient manner, these instruments should be a part of a comprehensive framework of public policies for fiscal and disaster risk management.
Recognition of SICA and CEPREDENAC to the private company resilient to disasters
In recognition of the effort to incorporate disaster risk reduction to the continuous improvement of their products, processes, services and territories where they operate, SICA and CEPREDENAC awarded the recognition of Resilient Company to the Guatemalan Sugar Association (Asociación de Azucareros de Guatemala, ASAZGUA).