Dominica’s Financial Institutions Face Risk Assessments Due to Climate Change

A recent report by the Stimson Center highlights the increasing vulnerabilities of Dominica’s financial institutions to climate-related risks. Severe weather events and flooding pose significant threats to the island nation’s economy, with extreme weather events already causing substantial economic damage in recent years.

CORVI Climate Rapid Risk Assessment

The CORVI climate rapid risk assessment reveals that Dominica is increasingly susceptible to:

Hurricanes
Tropical storms
Droughts

These events have already caused significant economic damage, with Tropical Storm Erika in 2015 resulting in damages equivalent to 90% of the island’s GDP.

Impact on Marine Ecosystems and Economy

Rising temperatures are having a devastating impact on Dominica’s marine ecosystems, causing:

Significant damage to coral reefs
Threats to the tourism industry
Compromises food security for citizens

Recommendations for Government Action

To address these challenges, the report recommends that the government consider the following key steps:

Designate a single agency to coordinate climate resilience efforts
Establish a disaster review board to improve response times
Develop an online data-sharing platform to integrate climate risk data and make it accessible to government, civil society, the private sector, and international partners

Prioritizing Climate-Resilient Infrastructure for Financial Institutions

Financial institutions in Dominica are also at risk due to climate-related events. The report suggests that they should prioritize investments in:

Climate-resilient infrastructure
Developing contingency plans to mitigate the impact of extreme weather events

Broader Efforts by Stimson Center and ORRAA

The CORVI assessment is part of a broader effort by the Stimson Center, with funding from the government of Canada through the Ocean Risk and Resilience Action Alliance (ORRAA), to help coastal cities and small island developing states understand and prioritize actions to address their climate risk.

Dominica’s Climate Adaptation Efforts

Dominica has made significant strides in strengthening its climate adaptation efforts, including:

Establishing the Climate Resilience Execution Agency for Dominica (CREAD) in 2018
Creating the world’s first sperm whale reserve off the island’s western coast

However, despite these efforts, Dominica still faces significant challenges in addressing its climate risk. The report emphasizes the need for a whole-of-government approach to build resilience.

Conclusion

The Stimson Center is committed to helping governments like Dominica develop effective strategies for addressing their unique climate risks and building resilience in the face of a rapidly changing world.