The World Bank’s Executive Board has approved a $430 million project to help Guatemala improve its resilience against natural disasters and extreme climate events. The operation aims to boost the country’s ability to manage disaster risks and protect vulnerable populations, including women who are heads of households, Indigenous peoples, people with disabilities, and those living in informal settlements.
The initiative will focus on regions that face significant exposure to disasters such as the Dry Corridor, Petén, and urban municipalities on the outskirts of cities. These areas are particularly at risk due to their geographic location and high poverty rates. The funding comes through a Development Policy Loan with a Catastrophe Deferred Drawdown Option (Cat DDO), which will allow Guatemala to quickly access resources after events like hurricanes, earthquakes, or volcanic eruptions. This mechanism is intended to reduce fiscal strain and speed up recovery efforts.
Two main components make up the operation. The first involves strengthening institutional capacity for disaster risk management by improving public policies and creating financial tools that offer greater protection for vulnerable families. The second component focuses on integrating resilience measures into sectors such as agriculture, transport, and housing so that essential infrastructure and services are better prepared for future crises. Public agencies are expected to include risk management in their planning processes, while social protection systems will be expanded to support households facing sudden losses of income.
Jonathan Menkos, Minister of Public Finance, stated: “This operation strengthens the State’s ability to respond swiftly to emergencies, protect fiscal stability, and ensure that public policies reach those who need them most. With this project, we reaffirm our commitment to building a safer, more equitable, and better-prepared country, where institutions can effectively respond to risks that affect the well-being of Guatemalan families.”
Pierre Graftieaux, World Bank Resident Representative in Guatemala added: “This project is essential because it enhances Guatemala’s capacity to respond quickly and effectively to disasters and external climate events, reducing the impact on all Guatemalan families, especially those living in poverty. It will provide the country with financial support to help guarantee basic services for the most affected populations.”
Guatemala faces high vulnerability: over 80% of its GDP is produced in risk-prone areas and almost half its population lives below the poverty line. Disasters tend to worsen existing inequalities by affecting groups such as women, children, people with disabilities, and Indigenous communities more severely. From 1997 through 2014 about 35% of households among the poorest experienced impacts from disasters.
The project was developed with assistance from the Global Facility for Disaster Reduction and Recovery (GFDRR). It is planned for three years but may be extended further if needed.
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