The World Bank approved a $430 million loan to help Guatemala respond faster to hurricanes, earthquakes, and other disasters that regularly pummel the Central American country, according to press release. The Development Policy Loan with a Catastrophe Deferred Drawdown Option lets the government quickly access emergency cash when disasters strike instead of waiting for lengthy approval processes.
The money targets Guatemala’s most vulnerable people, including women heads of household, Indigenous communities, people with disabilities, and families living in informal settlements. The loan focuses on high-risk areas like the Dry Corridor, Petén, and poor urban neighborhoods where geographic dangers combine with poverty to make people especially vulnerable. Guatemala ranks among the world’s most disaster-prone countries, with over 80% of its GDP generated in risk zones.
Nearly half of Guatemala’s population lives in poverty, and disasters make existing inequalities worse. Between 1997 and 2014, 35% of the poorest households got hit by disaster impacts. Women, children, disabled people, and Indigenous communities bear the worst effects when hurricanes, volcanic eruptions, or earthquakes strike. The country sits in a particularly dangerous spot where multiple hazards converge.
The project works on two main areas: building stronger institutions for disaster risk management and making key sectors like agriculture, transport, and housing more resilient to extreme weather.
“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,” said Finance Minister Jonathan Menkos. World Bank Representative Pierre Graftieaux said the project “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.”
The three-year project, prepared with support from the Global Facility for Disaster Reduction and Recovery, will expand social protection systems to help households hit by sudden income losses. Public agencies will have to incorporate risk management into their planning and budgets, while critical infrastructure gets built to better withstand extreme events.
The loan gives Guatemala financial tools to protect fiscal stability when disasters hit while ensuring that emergency response reaches the people who need help most.
