S2 Ep 1: If we know it’s coming, why do we wait?

Wildfires, floods, drought – climate disasters are hitting harder and faster. The response is often too late, leaving millions to suffer. 

In fact, less than 2% of international crisis financing is arranged in advance —and an even smaller portion reaches the world’s poorest communities. 

What if we could act before catastrophe struck? In this episode of Counter Crisis, we uncover how pre-arranged financing – committing funding and preparing response plans in advance – can help in places where floods, drought, and conflict have eroded coping capacities. 

Jeevan Vasagar from Tortoise Media is joined by Nena Stoiljkovic and Abdihakim Ainte. 

Available on Spotify and Apple Podcasts.

Counter Crisis is brought to you by the Centre for Disaster Protection, which helps countries find better ways to manage disaster risk – protecting lives, livelihoods, and economies before crisis strikes.

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Transcript

Intro

Catastrophic flooding in Spain left streets submerged. 

“It is a catastrophe, the floods we had in 1982 when I was 10 years old  were a joke compared to what happened here.” [link 1.05 - 1.22]

“They raised the alarm when the water was already here. When they told me the flood was coming it was already too late.” [link 1.33 - 1.44]

Sometimes disasters cannot be prevented… like the earthquake in Myanmar.

But the slow response to that crisis made matters worse

“In Myanmar, where the death toll from the devastating earthquake last week has now surpassed 3,000, and as relief efforts have been hampered by that country’s civil war.”

The Global South faces disproportionate impacts, with Africa being the hardest-hit yet least prepared continent. Somalia is on the frontlines of this new reality…

“ The Republic of Somalia has a long history of droughts, but the climate shocks are becoming more frequent and they’re leaving less time to recover and to prepare for the next situation.” [link]

…In 2022 a drought left 7 million people facing hunger. For Somalia the warnings did come in advance, yet funding still arrived too late to stop the catastrophe.  

What if disaster relief wasn’t just about picking up the pieces? What if funding was in place before the crisis hit – allowing aid to reach people when they need it most?

This is Counter Crisis, a podcast by the Centre for Disaster Protection focused on disaster risk financing. In this second season, we’ll be hearing from experts working in international organisations and people on the ground to understand how we can better utilise pre-arranged finance to minimise the impact of climate disasters. My name is Jeevan Vasagar, and this is episode one. 

Interview

Jeevan Vasagar: I'm joined by Nena Stoiljkovic, Undersecretary General for Global Relations, Humanitarian Diplomacy and Digitalization at the International Federation of Red Cross and Red Crescent Societies, and Abdihakim Ainte, Director of Climate and Food Security for the Government of Somalia.

Abdihakim, let's start with you. Somalis face devastating climate shocks, droughts, floods, food insecurity. Can you give us a sense of what these crises have meant for people on the ground?

Abdihakim Ainte: I think climate remains an existential threat to fragile and low income countries, particularly Somalia, where, you know, the vulnerability of climate has really exacerbated and displaced the livelihood of a lot of Somalis in different ways.

Countries with fragile institutions have been decimated and their coping capacity has also extraordinarily collapsed, thus becoming vulnerable to every shock. 

I mean, Somalia, it's no secret that is the 2nd most vulnerable country to the climate disasters around the world. 

And as we really see you know, the impact of the climate, the local people, especially the livelihoods and the farmers continue to pay  a significant price, it also threatens our core social fabric. 

Jeevan Vasagar: Abdihakim, can you just paint a picture of what that means in terms of people's lives, in terms of access to nutrition, in terms of disruption to children's education, in terms of economic progress?

Abdihakim Ainte: So, we're talking about nearly 3.8 to about 4 million people that are internally displaced that are living in a permanent makeshift camps and as a result of the climate shocks and the climate that have been displaced. And then you're talking about, you know, a significant amount of people, especially children who face acute malnutrition, and this is all in the result of the climate, but also the result of a failure of the the global community's response, but also our ability as a government to really provide an adequate response whenever there are climate shocks.

And then talk about the systemic, the increased human costs especially in camps, migrations. You know, floodings, diseases, so on and so forth. So we're talking about a pretty grim picture on the ground. 

Jeevan Vasagar: Abdihakim, are we getting better at picking up early warnings of when a difficult situation is tipping towards a crisis? 

Abdihakim Ainte: I think the government of Somalia by and large, it's really getting slightly better in terms of our response that the local institutions are now at the forefront in responding to any early warning.

For example, the government agents called Somali disaster management agents is “Sodma”. Has been really at the forefront in really struggling and raising the alarm bell by working with the local communities, working with the telecom industry, providing an encrypted messages, providing, you know, ringtones on the phones to at least accelerate and help a lot of local community whenever there is a looming, humanitarian disaster, but also we have a very much centralized coordination within the government that able to provide a very, you know, exclusive information to the people. And we also coordinate with other partners, both on the ground as well as outside. 

So there is now an increased momentum in terms of the degree to which the government is able to provide information with regard to early warnings, the problem that we lack is the early response and early finance

Jeevan Vasagar: Nena, when you have the warning and you're moving towards action, it's critical to have finance in place.

Can you give me an example of how your organization, the IFRC, has used pre-arranged finance? 

Nena Stoiljkovic: Yes, of course. I just want to say for the record that pre arranged financing is only 1. 2 percent globally of the overall financing. And I also wanted to say that it's really unfortunate, given that around 70 percent of weather related disasters can be predicted.

So Jeevan, when you look at where we stand, we're actually at the very, very beginning 

Jeevan Vasagar: And it seems completely out of kilter right with our with our ability to forecast 

Nena Stoiljkovic: It doesn't make any sense and I have to throw one more figure in, which is that if you invest 1 before the crisis, you actually save six to 7 from the response, right?

We need to act before the disaster hits and for some reason that's not so easy. So I'm very, very proud that the IFRC is making some small steps in trying to have more prearranged financing. In the first place we have a pot of money, a fund that is there available for any of the Red Cross or Red Crescent National Societies when any type of disaster occurs, we are able to disperse from that fund, which by itself is a prearranged multi donor fund in a matter of hours. And by doing that, we have been able to help evacuate people from their homes, from their communities in safe places.

We have been able to protect their households and their savings. We're able to give them cash as part of their preparedness for the upcoming disaster. And in Bangladesh, we deeply believe that the 2.5 million people that were evacuated during Cyclone Sitirang is a result of some of those actions.

Does it happen everywhere? Does it happen all the time? Of course not. That's kind of one way how I think about prearranged financing, but more importantly, we were also able to bring private sector into some of our solutions. And we have been able to ensure that fund on an indemnity basis and to generate more income through insurance proceeds into the fund because it's never enough, right?

The fund is right now around 100 million. It supports around 80 to 90 Red Cross and Red Crescent National Societies per year, sometimes even multiple disbursements, but because we see an increasing number of disasters and the funding overall decreases. 

Jeevan Vasagar: Abdihakim, what Nena has just described sounds like a really good idea, but she's also pointed out that it isn't very widely adopted. Are there barriers that prevent countries from accessing and implementing pre-arranged finance?

Abdihakim Ainte:So in a country such as Somalia. I mean, barriers really range we have our limited governance structure. You know, the challenge is a lot externalists talk about the vertical funders, the adaptation fund, the GCF funds. It's very difficult for a country to easily access because of the because of the extraordinary amount of rules and regulations that are in place that's so difficult for a country to access.

We need to really improve our, uh, our accountability systems to ensure that all those resources that 

Jeevan Vasagar: Okay. Nena, how do you think we can begin to solve this problem? How can international organizations and governments really work together to scale up anticipatory action and prearrange finance? 

Nena Stoiljkovic: I think we would have to make some shifts collectively because they agree that the global climate financing architecture is a bit fragmented.

And even if we have some billions they're very hard. to reach the affected communities. And then there is a whole chain in between even we, as I foresee as an organization, we're not accredited to a green climate fund and to adaptation fund. And we believe that we are the one that's mostly locally based and can deliver that local resilience building and, and, and early action in the community. So one shift would be to find a way for the global funds, climate funds to be able to channel funding through organizations like ours. I would say where we'd have Somalian Red Crescent actually a recipient through IFRC of the funding that's needed, and we're working on that.

I don't want to sound negative. We are now in the process of getting accredited one large program for 12 countries with green climate funding. If that happens, it will be a signal. Of shifts that those organizations are making. So that would be one shift. I think another shift is to think more locally while funding is globally coming mostly from the global north.

I think we realized that the response, whether it's preparedness for disasters or direct response to disasters will have to be done locally. So the whole system of humanitarian sector and large organizations with big headquarters and a lot of People will not be able to deliver locally, right? So this partnerships locally in the countries like Somalia and that the community level are very important.

So that's the second shift, which many are calling localization. And the third shift, and perhaps the biggest opportunity for all of us is to move from ODA, which is very limited, will always be limited. This is this precious donor grant funding by top donors, OECD countries, to move to more private sector solutions. So that's the third shift where I would see a lot of private sector and from foundations to corporates willing to be with us in solving problems of resilience and climate adaptation. 

Jeevan Vasagar: Abdihakim, Nena's just referred to the pullback that we've seen, uh, from public sector, particularly recently the U.S. Can I just ask you what impact that's having on the ground? 

Abdihakim Ainte:I think it has really an enormous impact, especially, you know, countries such as Somalia, where you know, there is an increased dependence on foreign aid, particularly within the humanitarian and health domain, it has really distressed our already you know, our already weak economic situations, U.S. aid makes up a significant amount of or contribution, a significant amount of resources within the humanitarian space and their withdrawal, their precipitated withdrawal has really caused some distress and and a bit of you know, war is but also it raises another serious question among, you know, I mean, for example, we have had this discussion early last week among the government. I mean, what does it mean this in real time for us? I mean, can we explore an alternative source where we can really look into, uh, you know, maybe maybe the private sector, private capitals. Can this be the beginning of a serious and a fundamental evaluation on how we really perceive aid and how we continue to engage because too often.

There is a saying within Somalia, or especially within the humanitarian the more aid you pump into countries, the more it becomes acutely dependent. It's pretty much like an opium. You just receive and you continue to receive, and then it becomes a vicious cycle. It's very difficult. So we have been really exploring a different mechanism, different avenues on how we can better move away from the humanitarians.

I know in short term it will pay a price. It's very difficult. I know some people would lose their jobs. Some people would lose their humanitarian, especially WFP, which distributes large amount of food in remote and IDB camps. They will pay the price. But I think it could, could this be a blessing in disguise in the long term?

Could this be an opportunity where we fundamentally re-evaluate our aid and see how we deal with aids and, and at least you know, devise a strategy that would pave us the way for finally looking and exploring an alternative sources. And I think, okay. Not only Somalia, but other countries across the continent the conversation has already began. I just came back from Kenya, where also they have started talking about the alternative resources and financing rather than, rather than only waiting and acutely dependent. And I'll tell you,, It's not only going to be U.S. aid. We can tell also the feeling also among other donor countries. They have already began really looking into and considering if they can reevaluate and cut off some of their aid money in different sectors. We have seen that that conversation has already started and began in other capitals. So we've got to prepare.

We have to be ready for how we can explore an alternative source of funding for our sustainability

Jeevan Vasagar: In which other capitals is that conversation happening? 

Abdihakim Ainte: I mean, for example, there is a big question that's emerging whether the way business as usual is sustainable, and there has been a huge body of literature and discussion that aid over the last, you know, years or decades. It has proven to be somewhat of counterproductive. But with the exception of few instances and cases, where aid, uh, you know, saves, uh, life, such as humanitarian disaster.

But the very premise, the very basic premise of continuing to pump money for short term programs, for handouts on humanitarian, has that gotten us anywhere? Has that changed the lives of people? The answer is no. So what can we do here? And I think this is, I think, where we, most of you know, LDC countries have began discussing, okay, can we first and foremost, began exploring an alternative finance, maybe working with all the private sector. Can we, you know, can even the aid be rechanneled and repurposed and repackaged in a way it can finance a development project, especially an enduring, strong, resilient project is such as, you know, building infrastructure, you know, water, dams, you know, large agricultural sectors.

Also, can we just repurpose our aid and then finance it and invest it into a more long term investment and I think that's what I meant, you know, there is a discussion among the donor that, you know, the very basic premise and rationale. Over the last six to seven decades has been saving a life.

But could we go beyond and look into, can these resources, their money, can this money be repackaged and being redirected in a more efficient, in a more sustainable and endurable and enduring manner rather than the short term putting millions on humanitarian and life saving.

So that is the sort of the discussion that we need to have within the government of Somalia and other other L.D.C. countries.

Jeevan: In the days after our interview, two major donor countries made significant shifts in their aid policies.

In the UK, Prime Minister Keir Starmer announced deep cuts to international aid, reducing it from 0.5% to 0.3% of national income by 2027. The savings will be redirected to defence spending, a move critics warn will have devastating consequences for global development efforts.

“Coming up the Prime Minister brings forward plans to increase UK defense spending amid questions over Donald Trump’s commitment to Europe and his visit to the White House on Thursday. He says the UK will spend 2.5% of GDP on defense within the next 2 years and the foreign aid budget will be cut to pay for it. The Prime Minister says it’s a generational response to a generational challenge.” (link 0.01 - 0.23)

At the same time, the Netherlands adopted a “Netherlands-first” approach to development aid. Minister Reinette Klever announced deep cuts to programs focused on gender equality, education, and climate, stating that only projects benefiting the Netherlands directly would continue receiving funding.

These moves by the global north are causing the global south to rethink their funding partners. 

Jeevan Vasagar: Nena, given the context that Abdihakim has just given and the need that you pointed out earlier to scale up prearranged financing, how is that done when there's when there's when it's sort of become increasingly difficult to draw on public sector finance and and sell this to taxpayers in rich countries.

How do we go about this? 

Nena Stoiljkovic: I think that we need to start using grants in a smarter way. We will always need some grants, some non returnable instruments to leverage them with something that's more returnable. I mean, for that sustainability that I believe Abdihakim talked about, it will never be 100 percent profitable, viable financial structures in the humanitarian sector. 

But remember this sector has been 100 percent funded by grants. So the shift that I'm talking about is not an easy shift to make, right? It requires a cultural shift. There is this moral dilemma in terms of whether I will use 1 grant now to buy insurance for something that may later be financed versus using 1 now to save t he life of someone today.

So we have to overcome that with some examples, successful examples. And I think taxpayers, you mentioned them. They also would like to believe that their funding that goes through ODA is used for saving people's lives in a visible way. Right. And not sitting in some risk. Pools and insurance structures, et cetera, et cetera.

So we have a lot to work on, but I think it is possible. I think governments can now buy insurance through the regional risk pools like Africa Risk Capacity provides that. And you can use some grants to buy, to help the governments buy that insurance. So you're already kind of maximizing the grants.

What we have done on our disaster response fund, we bought insurance for the fund and we put very small amount. of grants into, into that. premium, right? Three million only, but we got five times more. So instead of dollar donors giving five times more grants, they gave one fifth of grants for  five times greater impact.

I mean, we have to play this multiplier game and we need to work on the cultural aspects across the humanitarian organizations within us. We need to change the way we think about it, but also the donors and the taxpayers and our ultimate goal is to leverage every single grant, at least the dollar of grant five times, right?

At least that much. So that's how we will increase the overall funding, um, to fulfill this incredibly big need, right? That we have, that, that. It's has been for years now on unfilled. 

Jeevan Vasagar: Thank you, Nena. And I just want to turn the conversation towards COP 30 this year and ask you, Abdihakim, what policy shifts or commitments would you like to see to drive momentum towards prearranged financing in particular?

Abdihakim Ainte: I think there is, um, there's an expectation, uh, I would say a high expectation of CoP30, at least there will be a breakthrough in Brazil and there will be at least some increased momentum despite the current challenge that US is just pulling out from the climate from the Paris Agreement, so and so forth.

You know, it will all very much depend on the commitment and the honor from our Paris agreement. Should the global North continue to decide and honor their commitments and their pledges. There will be a shift, there will be a shift in our policy and our thinking, but should business continue to be as usual?

I think then it's going to be another missed opportunity. I mean, Somalia was recently elected in the security council as an impermanent member, and we hold a significant amount of leverage within the global arena, and we will try to see how we can champion and really speak of other countries who share the same burden with us with regard to climate finance.

Jeevan Vasagar: Do you have similarly high expectations of cop 30? 

Nena Stoiljkovic: Let's see. I hope so. In my mind, we need to continue to argue for climate adaptation. Investment in resilience versus response. As I explained dor some reason in the humanitarian sector in particular, that role of humanitarian organizations at the community level on resilience is not widely accepted, recognized and appreciated.

So if this COP can can bring kind of that to the center, I think the financing mechanisms will then follow that principle. And on my side, I mean, if there is a message to policymakers and then donors. I think we need more pooled funds for climate resilience and response, less tied money, more flexibility as, as we deploy some of those funds for the speed and, and flexibility that's needed.

And we need donors to integrate premium payments into their policies, uh, that to allow the ODA also to go for premium payments. We saw it when we were collecting funds or raising funds for the premiums that not many governments can actually invest their ODA in premiums. It has to be a direct humanitarian action or response.

Jeevan Vasagar: One last question to you, if we don't succeed in scaling prearranged financing now, what are the risks you think we're facing in the next decade?

Abdihakim Ainte: I think there is a high risk that we relapse into yet again another humanitarian catastrophe, the like is on the scale of which, it's going to be biblical in proportion and in number. I’m really not hoping that, I hope that the honor and the pledge that are being made is, is materialized and that we really able to meet our demands and commitments.

So, I think the prearranged finance are really essential and life saving as you know, Mina was talking about. It's very important that we definitely continue. So, you know, fragile countries such as, you know, Somalia and other countries, I think we are, in fact, more exposed and more exposed than other countries when it comes to this prearrangement finance.

So I'm not hoping anything. I don't want to be gloomy and to me in terms of the expectations, I always remain optimistic and I think there's a will. If we do not do that, I think the fallout will be Cataclysmic, I can tell. It's going to be really a devastating one. 

Jeevan Vasagar: Nena. A last word from you, if I can, what's one key message that you really want global policymakers to take from the conversation we're having now?

Nena Stoiljkovic: I would like to say that now that we can predict pretty much every single climate disaster, we absolutely have to make sure that we have policies in place and to pull the funding that's required to respond to those forecasts. And we need to move the money to the communities that are most affected, most impacted by those disasters. 

And that goes back to having more pulled prearranged funds with flexible use so that we can make fast disbursements, leveraging ODA multiple times, through prearranged insurance schemes, and also pushing the various sectors in the development and humanitarian sector to work more closely together, in any single context. 

And of course, the last but not least, incentivizing private sector engagement, being able to link the instruments that are in the public sector to those that the private sector can support us with because that's where a lot more funding is.

And we just need to bring it to the prearranged financing options that will be much easier than bringing just grants from the private sector. 

Jeevan Vasagar: Nena, thank you very much. Nena, thank you very much. Abdihakim, Mahat Senet, great speaking to you both. Really enjoyed this conversation. 

Abdihakim Ainte: Thank you so much.

Nena Stoiljkovic: Thank you

__________

Outro

Disasters are getting worse. More frequent, more severe, more destructive. From hurricanes to wildfires to flash floods, communities are facing crises at an unprecedented scale.

And yet, the systems designed to respond – especially the financing mechanisms meant to provide relief – aren’t keeping up.

In our next episode, we ask: Why is the status quo so hard to change?

We'll hear firsthand from someone on the ground about navigating overlapping agencies and slow-moving institutions.

We’ll understand why local leadership matters and we’ll challenge the idea that solutions should come from the usual power centers – asking instead what locally-led disaster response could look like.

Daniel Lund, Special Advisor on Climate Change to the Fijian government, and Kathy Baughman McLeod, the CEO of Climate Resilience for All, will join us, offering their perspectives on what it will take to move beyond incremental fixes toward real, systemic change.

That’s next time on Counter Crisis.