Fiscal Management of Natural Disasters in Colombia

The Government of Colombia (GoC) is developing an integrated financial strategy against natural disasters, which includes the fiscal accounting of contingencies arising from natural hazards. Natural disasters are the GoC’s second most important source of contingent liabilities, with annual expected losses estimated at US$490 million (0.7 percent of its budget) and one in 100 year losses estimated at US$3.0 billion (4.4 percent of its budget). Integrating contingent liabilities in fiscal risk management frameworks can help improve the fiscal resilience of the country.