The Asian Development Bank (ADB) has approved a $56.4 million program aimed at strengthening the disaster response capabilities of the Kyrgyz Republic and Tajikistan. Both countries face high exposure to natural hazards such as earthquakes and floods but lack sufficient fiscal capacity and risk transfer tools to manage disasters effectively. The new program is designed to improve their financial preparedness through a risk-layered approach.
At the core of the program are two pre-arranged financing instruments that address different levels of disaster severity. The first is Contingent Disaster Financing, which provides budgetary support for medium-scale natural hazards and health emergencies. The second is a Disaster Relief Bond, a catastrophe bond issued in international markets that delivers rapid liquidity in the event of major, high-severity disasters. Together, these tools aim to reduce the fiscal strain that disasters place on both governments and promote a shift from reactive response to proactive financial risk management.
ADB emphasizes that the program will be supported by policy reforms, enhanced institutional capacity, and improved governance structures to ensure more coordinated and transparent disaster risk management. This combination of reforms and financial instruments is expected to strengthen long-term resilience in both countries.
The program was developed with support from ADB’s technical assistance for establishing a disaster risk transfer facility in the Central Asia Regional Economic Cooperation (CAREC) region. CAREC is a collaborative framework that promotes sustainable development and economic growth across participating countries and development partners.
Funding for the program includes a $53.1 million grant from the Asian Development Fund (ADF) and $3.3 million in cofinancing from the Asia-Pacific Climate Finance Fund. The ADF supports the poorest and most vulnerable countries in Asia and the Pacific, contributing to poverty reduction and job creation. ADB, as a leading multilateral development bank, continues to work with member countries and partners to advance inclusive, resilient, and sustainable development across the region.
