The World Bank has approved a $65 million loan to Costa Rica for funding in the wake of natural disasters.
The loan, similar to a line of credit, has been awarded to Costa Rica in anticipation of natural disasters so that the country may have funds readily available while its own emergency resources are being mobilized.
This also allows for the country to ensure that funding for ongoing development projects will not be interrupted or diverted when disaster strikes, according to a World Bank press release.
The funds may be disbursed over a period of three years with options for renewal, or immediately if the country declares a state of emergency as a result of a natural disaster.
Costa Rica is the first country to receive such a loan for natural disaster response. In its press release, the World Bank noted Costa Rica’s geographic vulnerability to a variety of the 49 major natural disasters it has suffered in the last 98 years – everything from volcanic eruptions to floods. It also cited the country’s “efficient disaster response system,” “effective enforcement of building codes, environmental standards and land use planning,” and strengthened legal and administrative infrastructures.
“The poor are the most at risk from the impacts of natural disasters,” said Laura Frigenti, World Bank director for Central America. “This operation, the first of its kind, will help ensure that affected populations receive assistance as soon as possible after a disaster and will support the continuity of development programs directed to alleviate and reduce poverty.”
Laura Chinchilla, who was acting president while Oscar Arias was in Europe, declared a national state of emergency last week in 15 cantons in the Guanacaste, Puntarenas and San José provinces as a result of the indirect effects of Tropical Storm Gustav, which left more than 2,100 Ticos homeless.