The Asian Development Bank (ADB) on Wednesday approved contingent disaster financing facilities of up to $500 million for Pakistan, designed to give the government prompt budget support after eligible disaster events and to soften their economic and fiscal impact.
In its statement, the Manila-based lender said floods, earthquakes and other disasters cost Pakistan an estimated $2 billion a year on average. The 2022 floods alone caused $14.9 billion in direct damage and $15.2 billion in economic losses. Poor and rural communities have less capacity to recover, the bank said, while women and girls are disproportionately affected.
The financing is part of the second subprogramme of the Climate and Disaster Resilience Enhancement Programme, which supports reforms to strengthen disaster preparedness and risk management and to build resilience into Pakistan's development planning and investment. It also strengthens the country's disaster risk financing framework so that money is available quickly after a disaster.
"When disaster strikes, it is often the most vulnerable communities that are hit hardest," said Emma Fan, ADB's country director for Pakistan, adding that investing in preparedness can protect lives and livelihoods, reduce economic losses and safeguard Pakistan's development gains.
The ADB had also approved a $500 million policy-based loan in 2024 to support climate change and disaster risk reduction in Pakistan.