The Global Shield Financing Facility (GSFF) is the World Bank’s flagship program on climate and disaster risk finance and acts as one of the three financing vehicles of the Global Shield against Climate Risks, alongside the Global Shield Solutions Platform (hosted by the Frankfurt School) and the CVF & V20 Joint Multi-donor Trust Fund (an initiative launched by the G7 and the Vulnerable Twenty [V20] Group of Ministers of Finance). The Global Shield aims to increase protection for vulnerable people and countries by providing and facilitating substantially more and better pre-arranged finance against disasters and climate risks. GSFF will support the Global Shield by leveraging the experience of Global Risk Financing Facility (GRiF), and of GRiF programs in 18 countries, with a diverse set of instruments across seven sectors.
GSFF is an evolution of GRiF. GSFF supports poor and vulnerable countries and people with increased access to financial protection against climate shocks, disasters, and crises. It provides technical advisory services and integrated financial packages to address protection gaps and also works to build strategic partnerships. The program is well-positioned within the World Bank’s corporate priorities, particularly in the context of the World Bank’s Evolution Roadmap, which has a strong focus on mobilization of private risk capital, protection of jobs, and crisis preparedness.
The GSFF is informed by some of the lessons learned from GRiF:
- Protect the real economy against climate shocks
- Move from financial instruments to integrated financial strategies
- Complement financial instruments with policy reforms
- Facilitate access to private risk capital for recovery financing
- Engage with nontraditional partners
What does the GSFF do?
The GSFF supports vulnerable countries and communities with increased access to climate shocks, disasters, and crises by:
1. Enhancing financial protection against disasters and climate shocks for vulnerable countries through analytical, advisory, and operational expertise.
2. Strengthening partnerships with non-traditional stakeholders, including regional risk pools, the private sector, civil society organizations, and humanitarian organizations.
3. Helping address financial protection gaps by providing strategic partnerships, technical advisory services, and integrated financial packages that offer coordinated and consolidated financial support to the vulnerable.
4 Pillars of the GSFF
In line with the Global Shield’s aim to offer a more coordinated, coherent, and sustained ecosystem of technical and financial support to vulnerable countries, GSFF sets a priority focus on collaborating with nontraditional stakeholders, including risk pools and CSOs as well as the private sector. Risk pools help strengthen countries' financial protection through affordable domestic insurance markets, which are vital as countries transition to independent pool entities. CSOs and humanitarian organizations bring technical and operational expertise with strong delivery channels. In addition, GSFF's envisaged partnership with the Insurance Development Forum, an insurance sector-led initiative aiming at expanding risk insurance to poor and vulnerable populations, will facilitate technical knowledge exchange on design and implementation of financial solutions, development of global goods, and executive education in partner countries.
The GSFF will play an important role in improving coordination among key DRF stakeholders. GSFF is committed to working with countries and coordinating with other stakeholders as part of the Global Shield. It is also working with the two other Global Shield financing vehicles, the Global Shield Solutions Platform and the Climate Vulnerable Forum/V20 Joint Multi-donor Trust Fund, to assess how to collaborate and how to harmonize operational principles and processes.
GSFF amplifies impact through grant financing integration. The Global Shield Financing Facility is a downstream financing vehicle, which co-finances the development and implementation of disaster risk finance (DRF) instruments, either as part of larger World Bank lending operations or as part of transfer outs, under which the World Bank transfers funds from a trust fund to an eligible partner entity.
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Read more about the Global Shield Financing Facility here. For more information on the Global Shield Financing Facility, please write to: gsff@worldbank.org