Croatia faces significant risks from earthquakes, floods, landslides, heatwaves, droughts, and wildfires. Average annual economic losses are estimated at about 0.8% of GDP, while the 2020 earthquakes resulted in damages and losses of around €16.1 billion—approximately 24% of GDP. Vulnerable communities, aging infrastructure, and institutional gaps exacerbate these risks, while only about three percent of losses are insured. Strengthening financial and social protection measures is essential to safeguard lives, jobs, and recent economic gains.
This is Croatia’s first Cat DDO. The program will help reinforce Croatia’s disaster preparedness and resilience by enhancing institutional capacity and increasing financial resilience across three pillars. First, through national reforms to strengthen infrastructure management and institutional capacity for adaptation. Second, with reforms in strategic sectors—including energy, tourism, and housing— to boost renewable self-supply of electricity, scale resilient tourism investments, and increase safety-focused upgrades in multi-apartment buildings. And third, through measures to encourage disaster insurance uptake and provide recovery support for vulnerable populations.
“This project gives Croatia the tools to respond to emergencies while building resilience needed to preserve lives, jobs and development gains,” said Jehan Arulpragasam, World Bank Country Manager for Croatia. “It is also supporting the government in building a safer, more equitable, and better-prepared country, where institutions can more effectively respond to risks that affect the well-being of the population.”
The Cat DDO has a three-year loan duration and provides contingent financing to complement budget reserve allocations, serving as a source of immediate liquidity and bridge financing while other funds are mobilized following a natural disaster. The Cat DDO forms part of World Bank’s Crisis Toolkit, providing predictable contingency funds for eligible emergencies, and operationalizing one of the key priority areas under the Country Partnership Framework for Croatia FY25–FY30.
