Croatia and World Bank to Strengthen Disaster Preparedness and Resilience

ZAGREB, January 28, 2026 - Marko Primorac, Deputy Prime Minister and Minister of Finance and Anna Akhalkatsi, World Bank Division Director for the European Union (EU), signed an agreement for a project aimed at strengthening Croatia's disaster preparedness and institutional, physical, financial, and social resilience. The Disaster Preparedness and Resilience Development Policy Loan with a Catastrophe Deferred Drawdown Option (Cat DDO) will enable the government to better manage the fiscal and social impact of disasters by allowing it to quickly mobilize resources, facilitating emergency response and resilient recovery.

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. Strengthening financial and social protection measures is essential to safeguard lives, jobs, and recent economic gains.

This is Croatia's first Cat DDO. The reform 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, through 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 €100 million loan marks a significant milestone in Croatia's ongoing efforts to enhance our disaster preparedness and resilience. It provides us with critical tools to better manage the fiscal impacts of natural disasters and to respond swiftly and effectively when emergencies occur. By strengthening institutional capacity, upgrading infrastructure, and promoting financial protection measures, we are dedicated to ensuring the safety of our population, supporting the resilience of livelihoods, and maintaining the progress of our economic development," highlighted Marko Primorac, Deputy Prime Minister and Minister of Finance.

"This project helps strengthen Croatia's ability to respond to emergencies while building the resilience needed to protect lives, jobs, and development gains," said Anna Akhalkatsi, World Bank Division Director for the European Union. "It supports the government's efforts to build a safer and more equitable country, with institutions better prepared to manage risks and safeguard people's well-being."

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 Preparedness and Response Toolkit, providing predictable contingency funds for eligible emergencies, and operationalizing one of the key priority areas under the Country Partnership Framework for Croatia for FY25-FY30.

Through the Crisis Toolkit, Croatia will also have access to the Rapid Response Option. This instrument allows countries to quickly repurpose up to 10% of undisbursed funds from existing World Bank-financed projects, providing additional fast, flexible financing for urgent needs while longer-term recovery is put in place.