Nepal and World Bank sign 'catastrophe bond' agreement to address earthquake risk

The Government of Nepal and the World Bank have signed a bilateral agreement on a disaster bond, known as a 'catastrophe bond.' Under the agreement, the World Bank will issue the bond.

The bond is being introduced with the aim of enabling Nepal to quickly mobilize financial resources to address seismic risk and potential damage and losses from earthquakes.

Since immediate funds are needed for relief and reconstruction in the event of a major earthquake, the agreement was signed with the objective of arranging financing in advance for such purposes.

The agreement marks the beginning of cooperation between Nepal and the World Bank for protection against earthquake risk. Details about the size of the bond and the timing of its issuance have not yet been made public.