The National,Wednesday 07th December 2011
THE Japanese government plans to jointly establish a large-scale insurance system to include Papua New Guinea and other developing countries in the Asia-Pacific region hit by devastating earthquakes, typhoons, cyclones and other natural disasters.
The scheme was revealed at the weekend by the Japanese newspaper The Yomiuri Shimbun.
It will be established jointly by the Japanese government, the World Bank and the Asian Development Bank, officials said Saturday.
For this purpose, funds would be drawn from premiums collected from countries like PNG and territories taking part in the insurance scheme and monetary contributions from Japan and other industrial countries, they said.
The insurance scheme would comprise two categories: One would be a mutual assistance system to help small countries in the South Pacific finance recovery projects, while the other would cover countries in the Southeast Asian region, according to the officials.
The system envisaged for South Pacific island nations assumes that at least 15 countries and territories would participate, including PNG, Fiji, Tonga and Samoa.
It would start operating as early as November next, they said.
A maximum amount of money to be paid out under the disaster damage insurance system would be worked out with reference to the maximum payment of US$120 million (about K260.5 million) for a disaster under a natural disaster insurance system already in place for Caribbean countries, the officials said.
The government would incorporate its contribution in the scheme – the amount has yet to be decided – into the state budget for fiscal 2012 and would make an official announcement of the plan during the sixth Pacific Islands Leaders Meeting scheduled for May 25-26 in Okinawa prefecture, they said.
Australia, New Zealand and some members of the European Union are considering making contributions to the proposed insurance system for PNG and its South Pacific island neighbours, according to the officials.
Japan hopes the 10-member Association of Southeast Asian Nations would take part in the disaster insurance plan.
One member, Thailand, is currently suffering from major flooding.
The system for the Southeast Asian area was expected to take effect as early as 2015, they said.
Simulations of damage caused by major natural disasters would be carried out in three countries – the Philippines, Indonesia and Vietnam – by the end of the year at the earliest, the officials said.
According to the ADB, the Asian region accounts for about 40% of natural disaster-stricken areas in the world.
Since many areas in Asia lack sufficient fiscal resources and earthquake-resistance preparations are deficient, they also are susceptible to social and economic disruptions because of natural disasters, the officials noted.
“The financial assistance extended directly to disaster-hit developing countries tends to take time to move through the domestic procedures involved, they pointed out.”
By creating the insurance system, disaster-hit countries will be able to draw on insurance money quickly to rebuild their infrastructures, the officials said. – Yomiuri Shimbun