Jamaica and Japan Sign Grant Agreement for CCRIF Study

Jamaica has signed a US$1.8 million grant agreement with the Japanese Government to carry out a Caribbean Catastrophe Risk Insurance Facility (CCRIF) viability study, which will allow Caribbean states to buy parametric insurance coverage against natural disasters.
The Jamaica Social Investment Fund (JSIF) will be carrying out the project, which will see Jamaica receiving US$800,000, while countries in the Organization of Eastern Caribbean States (OECS) will receive US$1 million to carry out studies.
Minister of Finance, Dr. Omar Davies signed the agreement with Katsumi Maruoka, Counsellor of Political Science and General Public Affairs in the Japanese Embassy, at the Ministry’s Heroes Circle Offices in Kingston today (October 25).
Under the Facility, client governments will be provided with immediate liquidity in case an adverse natural event such as a hurricane or earthquake, of a predefined magnitude, affects them.
Dr. Davies hailed the signing as an opportune intervention, given the adverse effects that hurricanes have had on the island and region within the past year.
“This is a very important grant agreement with the Japanese Government, which has been facilitated by the World Bank. It is an unfortunate but opportune time and I want to thank the Japanese Government and the World Bank,” he noted.
Following the devastation caused by natural hazards in the Caribbean in 2004, CARICOM governments had asked the World Bank for assistance with gaining access to affordable and effective disaster risk financing arrangements.
Nine countries have so far expressed an interest in the Insurance Fund, including St. Lucia, Barbados, St. Kitts & Nevis, Trinidad & Tobago, Belize, Jamaica, Dominica, and Antigua and Barbuda. Meanwhile, the World Bank and the Japanese Government have expressed confidence in the ability of the JSIF to carry out the project from being a concept to reality.
“All payments will be made via JSIF and we look forward to even greater collaboration,” Dr. Wayne Henry, Liaison Officer with the World Bank noted. Scarlette Gillings, Managing Director of JSIF informed that the preliminary studies and research work would get underway immediately with the draft of final reports expected to be ready by June 2006 and final reports to be presented in September 2006.
Studies will be carried out on five contract areas: Risk Financing Strategy of the Facility; Risk Modelling and Insurance Contract Design; Public Finance Review and Advisory Services; Insurance Captive Incorporation and Management; and Advisory Services for the Development of the Facility.