Rwanda Charts a Path to Financial Resilience Against Disasters

Images from May 2023 are still vivid in Rwanda's memory. Heavy rains caused devastating floods and landslides across the northern and western provinces. More than 130 people lost their lives, thousands were displaced, and many roads, homes, and farms were destroyed. Communities were left struggling to rebuild. The tragedy made one thing clear: climate shocks are becoming more frequent, and countries must change how they prepare for them.

Two years later, Rwanda is turning that painful lesson into action. On October 6-7, 2025, more than 100 government officials, development partners, and financial experts met in Kigali for a two-day workshop to disseminate the Rwanda Disaster Risk Finance Diagnostic (DFR) Report and to validate Rwanda's new DRF Strategy. The goal is simple but powerful, to make sure the country has funds ready when the next disaster hits.

The workshop, organized by the Government of Rwanda, the World Food Programme, and the World Bank, marked an important shift. Instead of reacting after a disaster and seeking emergency funding, Rwanda aims to plan ahead and have financial tools in place to respond quickly and efficiently.

Rwanda's Minister of State for National Treasury, Godfrey Kabera, referred to the strategy as a critical step forward in safeguarding Rwanda's development gains. "By integrating innovative financing tools, we are not only mitigating the risks of disasters but also ensuring that our communities recover faster and more sustainably," Kabera said.

Rwanda faces more frequent and severe floods, droughts, and landslides. These events threaten lives, infrastructure, and years of development progress. The people hit hardest are poor families and small businesses, which often have no savings or insurance to fall back on when disaster strikes.

Until now, the government has relied mostly on emergency funding after disasters. This approach is costly and often slow. The new DRF strategy aims to change that by building financial systems that can respond faster and reduce the economic impact of future crises.

Building a Layered Financing Approach
Following the validation, a DRF training workshop enabled participants to build capacity to explore and assess ways to improve disaster financing. They looked at tools such as national budget reallocations, emergency reserve funds, contingent finance, sovereign insurance, derivatives, and catastrophe bonds. These tools form a layered approach-different instruments are used for different types of risks, from small, frequent events to large, rare disasters. Based on the DRF diagnostic report, a risk layered approach could create savings of about $50 million per year on average, compared to the current approach. Even more savings could be generated for more extreme events.

Aristarque Ngoga, Permanent Secretary in the Ministry in charge of Emergency Management, explained it this way: "Resilience is built not only through infrastructure, but through financial systems that can absorb shocks. By putting in place mechanisms such as contingency funds, risk-pooling, and insurance, we ensure that our communities, local governments, and national institutions can respond effectively and recover swiftly when disasters strike. Financial preparedness is as crucial as physical preparedness in safeguarding lives and development gains."

Innovations and Early Successes
Rwanda is already making progress toward stronger financial preparedness through:

· $140 million Catastrophe Deferred Drawdown Option (Cat DDO): This is a pre-approved credit line that gives the government fast access to money right after a disaster, helping speed up recovery.

· Support for small businesses: Through the Access to Finance for Recovery and Resilience Project, Rwanda is developing an emergency lending program to help micro, small, and medium enterprises (MSMEs) get credit and debt relief when disasters strike.

· Social protection programs: An existing social protection project is being adapted to deliver quick financial support to families affected by disasters.

· Public-private insurance partnerships: The government is working with insurers to expand coverage for farmers, public assets, and infrastructure.

Together, these steps show Rwanda's determination to shift from reacting to disasters to planning for them.

Long Term Impact
Validation of the DRF strategy is only the beginning. The next step is to make disaster risk finance part of everyday government planning. This means coordination across ministries, close work with the private sector, and ongoing support from international partners like the World Bank Group. Training and capacity building will also be key to ensure local teams can manage and use these financial tools effectively.

The Government of Rwanda and the World Bank have reaffirmed their partnership to help put this strategy into action. Their shared goal is clear: to protect Rwanda's people, jobs, and investments from future shocks.

The floods of 2023 were a national tragedy but they showed the importance of being ready with emergency teams and infrastructure, and with financing that allows for quick action

Rwanda's Disaster Risk Finance Strategy is a bold step toward that future. By planning and putting the right financial systems in place, the country is making sure that the next disaster will not erase years of progress.

This feature was written by: Leyla Castillo, Qhelile Ndlovu, Lai Ming So, Jane C. Hwang, Brice Gakombe, Sylvie Noella Umwere