WASHINGTON, April 26, 2024 — The World Bank has announced additional support for Malawi to assist in the response to the severe food crisis affecting millions in the country. The support comes in the form of a quick-release of $57.6 million through the Catastrophe Deferred Drawdown Option (CAT-DDO), aimed at providing immediate liquidity to address the pressing food security situation exacerbated by El Niño conditions and a series of intense disaster events.
According to Hugh Riddell, World Bank Country Manager for Malawi, "Malawi, together with the wider Southern Africa region, currently faces very serious food insecurity, impacting millions. This crisis comes as the country is struggling to stabilize its macro-economy and get on a path of inclusive growth. We are pleased the Government of Malawi had the foresight to lock in a CAT-DDO instrument when securing IDA budget support in late 2023: this innovation can help the Government of Malawi’s efforts to mitigate the impact on the most vulnerable."
The CAT-DDO support was made available following the declaration of a national disaster by President Lazarus Chakwera on March 23, 2024, reflecting the urgent need for assistance in addressing the food crisis. Simplex Chithyola Banda, Minister of Finance and Economic Affairs, expressed gratitude for the World Bank's response, stating, "We are pleased with the World Bank’s response to the call made by President Chakwera by providing additional budget resources under the CAT-DDO which will significantly leverage the support from other development partners and well-wishers as we intensify the mobilization of resources to respond to the food crisis caused by El Nino."
The ongoing food crisis in Malawi is attributed to the strong El Niño conditions leading to rainfall deficits in certain regions and above-average rainfall in others, resulting in a range of climate-related disasters. The World Bank's support, including the CAT-DDO funding, aims to address the immediate needs of vulnerable populations while also laying the groundwork for long-term resilience and adaptation to climate change impacts.
In addition to the immediate assistance, the World Bank's Regional Climate Resilience Program for Eastern and Southern Africa 2 (RCRP-2) approved in December 2023 seeks to enhance disaster risk management and social protection systems to shield households from climate-related shocks. The recently approved Disaster Risk Management Act (2023) is seen as a crucial step in transitioning Malawi from a reactive disaster response approach to proactive preparedness and sustainable recovery strategies.
The Catastrophe Deferred Drawdown Option (CAT-DDO) serves as a critical mechanism to provide prompt financial support in response to high-impact events stemming from natural hazards or health-related crises, ensuring that countries like Malawi can access immediate liquidity during times of crisis.