The Caribbean Development Bank and CCRIF SPC, the former Caribbean Catastrophe Risk Insurance Facility, have launched a project to enable Caribbean countries to take a more proactive approach toward country risk management.
The Integrated Sovereign Risk Management in the Caribbean project moves beyond planning for natural disaster risks, such as climate change and events like hurricanes and earthquakes, and recognizes the intrinsic connection between the risk of disasters and economic, technological and financial risks.
CDB President William Warren Smith said the project “will help Caribbean governments address their increased vulnerabilities caused by socioeconomic factors as well as the technological and economic interconnectedness of communities across regions and throughout the world.”
At a launch ceremony, which was held on the margins of the 2017 CDB Board of Governors meeting, Mr. Smith noted that the Caribbean Development Bank has strengthened its risk management infrastructure over the past few years by adopting an integrated enterprise risk management framework.
The bank will use this experience to support a holistic approach to risk management in Caribbean states.
The project aims to maintain country ratings, share risk intelligence and mitigation strategies across the region, and encourage the adoption of a proactive risk approach to country management to improve economic performance.
CCRIF Chief Executive Isaac Anthony said the project is also “intended to enable the countries in the region to become more resilient, by enhancing the capacity of governments to take a portfolio view on risks and include all risk categories – technical, economic, natural and social risks – and their interdependence in a geographic context.”
A key part of this new integrated risk management framework will be to establish country risk officers or coordinators within countries. These senior level positions will be responsible for managing the overall risk landscape, taking a holistic approach to risks before events occur and ensuring that countries adopt a more proactive, precautionary approach to anticipating future challenges.
Malcolm Buamah, chief risk officer at the Caribbean Development Bank, noted that the initiative provides a formal process that enables the establishment of an effective country management platform that aims to deliver sustained economic growth and performance over the medium to long term.
It will also provide assurance to stakeholders and contribute to attracting competitive international financing and donor support.
“CDB’s success in enterprise risk management, complemented by CCRIF’s success in disaster risk management, can be leveraged and transferred to the country platform to deliver significant economic and developmental benefits across the Caribbean,” he said.
Several initiatives will be started over the next few months to advance implementation of the project.
The activities will include a regional conference on sovereign risk management for policymakers, which will provide an opportunity for these stakeholders to participate in the development of the standardized integrated risk management framework.