Small States' resilience to natural disasters and climate change - role of the IMF

This International Monetary Fund (IMF) Policy Paper discusses the vulnerability of small developing States, opportunities for change, and the role of the IMF in reducing disaster risk. While making note of the disproportional risk of disasters for small States, the paper discusses how well-designed domestic policies can reduce the direct human and economic costs of climate change and natural disasters with the help of international financing for risk reduction and response.

As practices around climate change financing evolve, it is important to help small States adapt to climate change in addition to climate change mitigation. Small States have begun to access global climate funds, however, their adjustment needs are under-funded by as much as $1 billion annually. Complex and administratively cumbersome procedures for establishing eligibility for climate change financing are hampering access by small States with weak capacity. The paper States that the IMF plays a niche-but-important role in meeting member’s post-disaster financing needs.