An impressive delegation of Pacific-based Finance leaders and key development partners recently convened at a 4-day Pacific Regional Debt Conference titled, “Addressing Debt Sustainability in the Pacific in the Aftermath of COVID-19.” The Pacific Islands Forum and the United Nations ESCAP organized the event.
Mr. Aholotu Palu, CEO of the Pacific Catastrophe Risk Insurance Company (PCRIC), addressed the group and elaborated on the potential of innovative financial instruments and mechanisms, and contingent disaster financing to strengthen financial resilience to disasters and climate-related risks. As the rate and severity of disasters continuously increase, critical and immediate access to post-disaster financial relief has never been more necessary for both crisis support and infrastructural redeployment, two of the most essential ingredients of sustainable ‘resilience’.
He emphasized that “given the increased nature of the risks that Pacific Island Countries are exposed to, there is no single financial instrument, including what PCRIC offers, that can independently mitigate risks that our region faces.”
“It is important to understand that all financial instruments are unique in their own ways and have the potential to mitigate disaster risks, hence contributing to strengthened financial resilience in-country. Therefore, we see that existing financial instruments are not competing, but rather, complementing each other.”
With an impassioned plea, Mr. Palu shared that “it is therefore critical for the leadership of island nations to take diversification of their financing options earnestly and to assess the suitability of each financing instrument against the frequency and severity of the varied disaster risks that the Pacific region encounters.”
In conclusion to his presentation, he reiterated that “it is important to create the technical and policy awareness at regional and domestic levels about the comparative advantage of the financial instruments that are available to Pacific nations in order to mitigate disaster risks.”
PCRIC endlessly advocates for a more proactive stance in safeguarding Pacific nations against natural hazards, and such regional gatherings greatly assist in enhancing the understanding around the relevancy of financial instruments in line with respective country risk profiles.