World Bank advises SA on climate risks

The World Bank is advising South Africa’s National Treasury on a climate risk strategy after floods in recent years caused billions of dollars of damage.

The country may take out climate insurance or establish a contingency fund to deal with major adverse weather events, said a source familiar with the matter, asking not to be identified as a public announcement hasn’t been made.

Municipalities could also be incentivised to invest in infrastructure and other measures to reduce the impact of unexpected weather events, the source said.

“National Treasury is receiving technical support from the World Bank to develop the disaster risk response strategy (covering all organs of state) which will address any gaps in financing, flow of funds and data for effective monitoring,” the agency said in a response to questions.

The plan comes two years after torrential rainfall in KwaZulu-Natal killed more than 450 people and caused about R38 billion of damage, according to research by the University of the Witwatersrand.

More than 4 000 houses were destroyed, bridges were washed away, operations at the country’s biggest port in the city of Durban were impacted and a Toyota Motor Corp plant was damaged.

The province has since been hit by other severe floods, as have the Western Cape and the Eastern Cape provinces.

The World Bank didn’t respond to a request for comment.

Under the current proposals, the government would cover the cost of more frequent, less severe disasters and use insurance or a fund to pay for catastrophic events, the source said.

Setting up a bulwark against the impact of weather disasters would be another step taken by the government to tackle the impacts of global warming.

The plan is separate to the possible establishment of a climate change response fund announced by President Cyril Ramaphosa in his State of the Nation Address in February.

That initiative is being explored by the department of forestry, fisheries and the environment.