From Pandemic to Greater Resilience: Enhancing Disaster Risk Financing in the People’s Republic of China
This paper explores innovative solutions to help manage economic and financial risks arising from disasters in the People's Republic of China (PRC). It suggests strategies that blend the use of reserves and contingent financing instruments.
The paper proposes five market-based parametric insurance pilot schemes to enhance the PRC’s public finance capacity for disaster risk response, to soften budget shocks, and to bolster long-term fiscal stability and resilience. The paper highlights the inadequacy of public finance instruments—such as fiscal reserves, contingent credit arrangements, and traditional indemnity insurance—to manage the contingent liabilities that disasters represent. It also discusses the effects of disasters on economies, societies, and global supply chains, particularly in the context of climate change.
- Executive Summary
- Responding to a Pandemic’s Wake-Up Call
- Disaster Risk Challenges in the People’s Republic of China
- Public Finance Gaps for Disaster Risk Resilience
- Innovative Models and Cases for Public Finance Responses to Disaster Risks
- Disaster Risk Financing Instruments
- Five Suggested Pilot Programs to Strengthen Disaster Risk Public Finance in the People’s Republic of China