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The World Bank and Jamaica have signed a deal to renew the country’s Catastrophe Bond at a value of US $150 million.
The move gives Jamaica an additional layer of protection, in case of a natural disaster.
Chevon Campbell tells us more.
As we approach the June start of the Atlantic Hurricane Season, the US $150million bond will provide insurance coverage against named storm events.
It’s a renewal of the World Bank’s 2021 bond for Jamaica.
Jamaica was the first small island state to independently sponsor such an instrument.
The World Bank says Jamaica is exposed to tropical cyclone events that threaten not only lives and livelihoods but also the country’s economic outlook.
For Jamaica, the bond forms part of a multi-layered disaster risk financing strategy reducing the fiscal burden of natural disasters while allowing the government to respond swiftly.
Payouts to Jamaica will be triggered when a named storm event meets the criteria for location and severity set forth in the bond terms.
The bond attracted 15 global investors, providing the funding for catastrophe insurance to Jamaica for four hurricane seasons.
Finance Minister, Dr. Nigel Clarke in reacting to the development, says the move is consistent with Jamaica’s National Natural Disaster Risk Financing policy.
He says it will provide immediate fiscal resources to enable a response to emergency expenditures that could arise from a direct hit by a high-intensity hurricane.
The latest bond will cover the hurricane seasons in 2024, 2025, 2026 and 2027.
Vice president and treasurer of the World Bank Jorge Familiar, praised Jamaica for taking a proactive step in protecting its hard-won fiscal position against natural disasters.
The bond will be listed on the Hong Kong Exchange, which is the second time the World Bank has listed a cat bond in Hong Kong.
English (US) ·