THE Philippines is committed to join Japan and five member-countries of the Association of Southeast Asian Nations (Asean) in operating an insurance facility to strengthen financial resilience among Asean member-states amid climate change and natural disasters.
This was confirmed in a statement issued on Tuesday by Finance Secretary Carlos G. Dominguez III. The statement said Dominguez assured Japan Deputy Prime Minister and Finance Minister Taro Aso of the Philippines’s commitment to sign the memorandum of understanding (MOU) on the establishment of the Southeast Asia Disaster Risk Insurance Facility (Seadrif). The head of the Department of Finance said the signing would occur when the Asean Finance and Central Bank Deputies hold their regular meeting with their East Asian partners Japan, South Korea and China scheduled in Fiji in May.
Aso had urged Dominguez to make the Philippines a part of Seadrif during their recent bilateral meeting held on the sidelines of the Annual World Bank-International Monetary Fund (IMF) Spring Meetings in Washington, D.C.
“I hope you can consider signing the MOU at the Asean Plus 3 meetings to be held in May. I raised this issue because Cambodia, Indonesia, Laos, Myanmar, Singapore and Japan have already signed this MOU and this is insurance against natural disasters,” Aso has said. The signing was held at the Asean Plus-3 Finance and Central Bank Deputies Meeting last December 14.
Dominguez said the Philippines will “definitely sign up” for Seadrif since it is already familiar with the insurance facility.
“We are already doing the parametric insurance with the World Bank so we are quite familiar with this, and we will definitely sign the MOU in Fiji,” Dominguez said.
The Philippines successfully placed on the international market in December last year its parametric insurance policy with a maximum cover of P20.49 billion that can provide quick liquidity to national and local governments.
This program provides coverage for national and local government assets against natural calamities, including public elementary and high schools in 25 disaster-prone provinces in the country’s eastern seaboard.
The first product of this facility, which was formed with technical support from the World Bank, is the establishment of a regional catastrophe risk-insurance program for Lao PDR and Myanmar.
By signing the MOU, the countries agree to collaborate on setting up and operating Seadrif, which is initially cochaired by Japan and Singapore.