mark cervantes presentation

INTERNATIONAL INSTITUTE OF RURAL RECONSTRUCTION

“Disaster Risk Reduction Beyond Micro Financing: A

Holistic Approach to Poverty Eradication”

Presented by:

MARK A. CERVANTESProgram Specialist

Disaster Risk Reduction and Climate Change AdaptationInternational Institute of Rural Reconstruction

4th Microfinance Best Practices Forum (MBPF)June 9-10, 2011, Mariott Hotel, Cebu City


Philippines Vulnerability to Disasters

The Philippines is vulnerable to almost alltypes of natural hazards because of its geographical locationIt is located within the Circum-Pacific belt of fires and along a typhoon path.As an archipelago with 7,107 islands, the threat of tsunami affecting the country’s coastal areas increases.

ANNUALLY: Average of 24 typhoons where 4-5 are destructive. Hosts to 300 volcanoes of which 22 are active.

Billions of pesos are lost yearly due to disaster events.


The Philippines among Most Disaster-Prone Countries

The Philippines shares with several Asian countries the unwelcome distinction of being one of the world’s most disaster-prone countries.

701 disaster incidents from 1900 – 1991 or almost eight (8) disasters a year

on the average annually.

In 2010, a total of 202 natural and human-induced disasters were reported in the Philippines. These killed 239 people, and affected more than 1.29 million families or 6.75 million people, and causedover Php 25 billion in economic damages. (Philippine Disaster Report, Disaster Statistics 2010, Citizen Disaster Response Center)


Climate Change is REAL!

on the average annually.


Prediction: Year 2100

Increase in global

temperature : 1.1C to 6.4C

Sea level rise: 0.36 to 2.5 ft.


Climate

Change

Emissions of

GhG

Translates to

Hydro-

meteorological

hazards

As global climate change escalates, the risk of flood, droughts and severe storm increases.


According to the 4th Assessment Report of the Inter-government Panel on Climate Change (IPCC), rising global temperature will cause increasing drought in mid-latitudes and semi-arid latitudes, increase water stress in many parts of the world, increased damage from storms, and coastal flooding affecting millions more people each year.

A 2 degree Celsius increase in temperature have grave impacts to the natural ecosystem. Plants will unable to grow and marine life may become extinct.


Climate Change increases “disaster risk” in a number of ways:

-It changes the magnitude & frequency of extreme events (flood, drought, sea level rise, typhoons);

- It changes average climatic conditions & climate variability, affecting underlying risk factors and generates new threats, which a region may have no experience in dealing with.


•In 2008, agriculture and fisheries comprise 15 % of the country’s gross domestic product valued at PhP 1.1

trillion at current prices (NSCB, 2008).

•In 2009, 34 % of the total employed labor force is in agriculture (NSO,

2009).

The Agriculture Sector


Effects of Climate Change to Agriculture

•Climate change and its insidious effects on crop productivity poses a serious

threat to agriculture and hence to food security.

•Increase in temperature due to climate change will intensify heat and drought

stress in crops.

•Crops in areas with limited water supply are gravely affected by the increase in

temperature that would reduce significantly crop yield.


Climate change will adversely affect the country’s watersheds and their

population of around 24 M, the forests and their biodiversity, also affecting

1.5 M of agricultural lands dependent on these areas for irrigation water.


Effects of Climate change to Fisheries

•Hotter water, as a result of increase in temperature, has negative effects on the

fisheries sector.

•It affects coral reefs resulting to poorer reef health and coral bleaching. Hotter water is

related to high sedimentation and high wave activity which affect seagrassess resulting to

reduction of seagrass population.


•Flooding and inundation in the coastal areas are expected to increase due to

accelerated sea level rise and increasing frequencies of cyclones and coastal

storms.

•Sea level rise causes loss of arable lands. It amplifies soil salinity in low-lying agricultural lands and causes

seawater intrusion into groundwater resources. It even results to coastal

habitat drowning.


An effect of climate change in water quality is anticipated to be in the form of decreased

oxygen level which may result to fish kill. This comes along with ocean acidification which affects mariculture and reduces production.


Approximately 50 M people are at risk from these climatic hazards, many of them marginal

communities of fishers, because 70% of the country’s human settlements are located in its

32,400 km coastline.

In terms of impact on food security, climate change could seriously affect coastal fisheries providing around 40-60 % of total fish catch,

representing 4 % of the country’s gross national product and 70 % of the populations’ total

animal protein intake.

Over-all, the Philippines’ coastal and marine resources directly provide food and employment

to around 1 M Filipinos.


Disaster Risk Reduction: A framework and tool that determines the degree of risk and describes measures to increase

capacitiesand reduce hazard impact on the

elements at risk so that disaster will be avoided.

The Way Forward…

Disaster Risk Reduction & Climate Change Adaptation


Why Community Managed? Because…Disasters are local. People in the community themselves are the affected and the first responders Global Warming …Climate adaptation happens locallyPeople are the foundation of nation etc…


“DRR in Micro Finance (why not?)”


An emerging framework for development and a tool


Delivery of financial services does not necessarily make clients and communities resilient against HAZARD /RISK events.

Vulnerability goes beyond economic empowerment (i.e. informal settlers, island people, Indigenous Peoples)

Disaster can be prevented and mitigated

Why?


Why?

Enhances MFI’s risk management strategies as a basis for pre-disaster planning to protect clients

Reality check: Chain of risk ( post disaster liquidity problem, loss of livelihood, clients inability to pay, increase overdues, bad debts)

‘enhances social performance by putting the client and community at the center of the process’


To what End?

Bridge the gap between D and D:

Disaster and Development Finance Decrease vulnerability and increase capacity of

clients and MFIs against hazards= Building Resilient clients and Communities

Enhance practices of MFI on social dimension


Linking MF to DRR Key Concept and Principles

1. From EXTERNAL relief to COMMUNITY-managed risk reduction- a necessary shift!

2. Pro-active products and services in relation to risk formula, i.e disaster & climate smart livelihood options;

Disaster Risk = Hazard x Vulnerability

Capacity


RISK FORMULA


Capacity individual or collective strength,

resources & access to resources to reduce risk/bounce back

proximity of person/livelihood to hazard considering

distance and time

potential event that could cause loss of life, damage ,

property or environment


RISK FORMULA: Where MFI’s are


Capacity

Survivability (ind) and readiness (community)

preventive and mitigating


RISK FORMULA in Microfinance

Risk = Hazard x Vulnerability

Capacity

business collapse because of crop loss due to flooding

Preventive : land use, zoning, water canal, reforestation, soil & water conservation

Mitigating :inter cropping, crop diversification, agro-forestry


RISK FORMULA in Microfinance

Risk = hazard x vulnerability

capacity

Survivability: backyard gardenReadiness: CBHP /health education during center

meeting, insurance, group liability


Mainstreaming

DRR process is like the branch of water that joins the main stream which is the

standard process in microfinance


HOW? Mainstreaming Social Performance Pathway

• Goals

• Objectives

• Range of products and services

• System use

• Service delivery

• Human resources

Internal influencesExternal Influences


How? Mainstreaming

Social Performance (social bottom)

A. STRATEGY- mainstreaming DRR vision, goal, objectiveMission – inclusion of client and community resilience against hazard events, of putting client at the center of the process

Goals – inclusion of target clients with high degree of vulnerability to risk

Objective- inclusion of risk assessment to target client and communities

‘deliberate not incidental’


How? Mainstreaming

Product Design : 1. Risk reduction measures ( i.e. savings for rebuilding of

houses after the seasonal tidal surges; savings for 3-day consumption in case hazard strikes ,crop /agri-insurance)

2. Development plan (microfinance and water, microfinance and solar, disaster –proof housing, credit for organic fertilizers, etc )

B. Operations Community participation : disaster risk assessments for

and by the community leading to identification of gaps and risk reduction measures (note: MFI staff as facilitator only)


How?

Incentives program / Loan approval criteria: garbage segregation, backyard garden, community projects for environmental promotion, composting, less use of chemicals & no anti-environment practices, etc

Training : DRR orientation


How? Mainstreaming

C. Results

Focus of monitoring and evaluation: Reaching target clients ( include high risk

clients) Meeting clients needs ( products based on risk

assessments , gaps and risk reduction measures)

Positive Change in Clients’ lives ( increased capacity, reduced risks, resilient clientele and their community )


Integration in standard process

Microfinance standard process

Site selection Client selection Training Loan Application Policies for approval Feedback mechanism MIS Reports Audit Exit survey Client satisfaction survey

Integrating DRR

Risk mapping Inclusion of potential

risks DRR orient’n &

assessment DRR/CCA practices Accomplishment on gaps DRR practices


Some attempts and efforts on integration of CMDRR at partners’ level

• Information on practices like garbage segregation/solid waste management

included in the Loan Form (USPD)

• Inclusion of CMDRR orientation during Information and Education Campaign through

symposia and General Assembly (USPD)

• Integration in the “entrep skwela” modules (USPD)

• CMDRR orientation included in the PMES (BCS/SEDFI) and credit investigation (BCS)


• Inclusion of CMDRR sessions in the Annual Development Plan of Paglaum MPC

• Meetings of Barangay Captain and Municipal Disaster Committees were used as opportunities for introducing

CMDRR concepts;

• Company workers mobilized for mangrove rehabilitation and started pushing for tree planting (KASILAK)

• Radio interviews were utilized as venue for CMDRR advocacies (KASILAK-Midsayap)

• As an advocacy initiative, presentation of the film “Signus” followed with CMDRR concepts orientation during

town fiesta (BCS)


In Summary Building upon

community resiliency through

developing and facilitating financial

products that would help

individual and community to

survive and bounce back

e.g. savings, crop insurance, risk assessment,

inclusion of high risk individuals


CHALLENGES

“BUY-IN “of staff, management and policy-makers

and the community ( literacy, social classes) Commitment: technical person, incentive ( not

necessarily monetary- i.e. deloading); Mind set: from “messianic” to “facilitator”: old ( ready-made/standard products) vs new

( community-identified products)

‘if there is a will there is a way’


Hazard Resistant/Resilient• MFIs products • Client investment

Resiliency is not economic empowerment alone

Disaster can be prevented.


Acknowledgement

Mr. Rusty Binas, Global Advisor on DRR, Cordaid

Ms. Rose Rivera, Micro Finance Sector, Cordaid

Sheila Vergara, Training and Capacity Building Specialist, IIRR

Dr. Oscar Zamora, Dean, Graduate Studies, UPLB


Thank You

mark cervantes presentation

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