This is the first time Mexico has a Catastrophe Deferred Drawdown Option (Cat DDO).
Washington, D.C., October 21, 2026. The World Bank has approved US$500 million in financing to help Mexico better prepare for and respond more quickly to natural disasters, the effects of climate change, and public health emergencies. This is the first time the country has accessed a Catastrophe Deferred Drawdown Option (Cat DDO), an instrument that gives the Government quick access to resources when an emergency occurs.
Mexico is one of the countries most exposed to hurricanes, floods, droughts, and earthquakes. A significant share of its territory and population is exposed to these risks. The country has a strong civil protection and emergency response system, and this support seeks to reinforce public policies that increase prevention and help reduce damage before it occurs.
- Mexico has demonstrated exemplary leadership in emergency response and in the financial management of disaster risks, and today it is taking important steps to prevent and reduce risks. With this operation, the World Bank reaffirms its commitment to supporting Mexico in building a more prepared and resilient country. We are proud to support the Government of Mexico in this first Cat DDO”Juan Pablo UribeWorld Bank Director for Mexico, Central America, and the Dominican Republic.
This support recognizes the Government of Mexico’s progress in reducing risks before disasters occur, in areas such as infrastructure, housing, energy, and health. These efforts can also contribute to employment and economic growth. When a flood, a hurricane, or a blackout disrupts activity, families, especially the most vulnerable, and businesses lose income and jobs.
Moreover, the Cat DDO provides additional financial protection that complements existing risk instruments such as catastrophe bonds and parametric insurance. It works as an emergency credit line: if a disaster or health emergency occurs, the Government will be able to access resources almost immediately, without having to urgently reallocate the budget.
The project was prepared with support from the Global Facility for Disaster Reduction and Recovery. It has a duration of three years, with the possibility of extension, and will support the country’s efforts in disaster risk management and climate resilience.
