Facing Natural Disasters, Indonesia owes the World Bank Rp. 7 Trillion

Suara.com – The World Bank again lent a debt to the Indonesian government amounting to USD 500 million or the equivalent of IDR 7 trillion at an exchange rate of IDR 14 thousand per USD 1.

The purpose of providing this debt is to strengthen Indonesia’s financial and fiscal resilience against the risks of natural disasters, climate change and risks originating from the health sector.

“Shocks and disasters like that continue to be a threat to the progress of Indonesia’s development,” said World Bank Representative for Indonesia and Timor-Leste One Kahkonen in his official statement, Friday (22/1/2021).

Based on records held by the World Bank, the Indonesian government in the 2014-2018 period, has spent a budget of around USD 90 million to USD 500 million per year for disaster response and recovery.

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Meanwhile local governments are estimated to spend USD 250 million during the same period.

He predicted that the cost of disaster management would continue to increase due to climate change and increasing urbanization.

This is an additional burden for government service spending plus the Covid-19 pandemic is still happening.

By reducing the impact of disasters, he continued, this plan can help protect the poor and vulnerable who often have to bear the brunt of disasters.

Moreover, most of them live in risky areas and do not have sufficient access to various basic services and financial resources to deal with the impact.

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The new project will also support the government’s Disaster Risk Financing and Insurance Strategy, by strengthening Indonesia’s fiscal and financial resilience through a Disaster Pooling Fund (PFB).

Source: Suara.com – Kumpulan Berita Bisnis Hari Ini Yang Terbaru by www.suara.com.

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