The Philippines Government may have alerted the World Bank on plans to draw from a $500 million catastrophe contingent line-of-credit it can receive through its Catastrophe-Deferred Drawdown Option arrangement, dubbed the CAT-DDO 4.
The Philippines government had in November signed up to the $500 million catastrophe contingent line-of-credit.
The financing facility is designed to provide US $500 million of capital to the Philippines government to help it manage the financial impacts of natural or man-made disasters and disease outbreaks and can be triggered, or activated, on a state of emergency declaration.
The Philippines Finance Secretary, Carlos Dominguez III, reportedly briefed journalists of the government’s intention to declare a disaster after typhoon Rai (locally known as typhoon Odette, or as typhoon 28W) smashed ashore and devastated a swathe of southern and central parts of the country last week.
It is officially reported that at least 375 people died the typhoon slammed the country with winds of 120 mph and higher gusts as widespread devastation had been reported from regions worst affected by the typhoon.
There are fears the death toll will rise when the difficult to access regions are reached and the true impact of the storm becomes clearer.
Already, President Duterte has now been told by advisors and his National Disaster Risk Reduction and Management Council that a state of emergency should be declared following the devastating impact of typhoon Rai.
Consequently, the Finance Secretary told the media that “the World Bank has been put on notice.”
Under the terms of the facility, the Philippines government can decide to draw up to the full $500 million from the catastrophe contingent line of credit (CAT DDO), but may not draw the full amount it seems.
For now, the government is waiting for reports from all its ministries as to how much financing that will be considered prudent to draw-down from this facility before formally sending its request to the World Bank.
