The USD 300 million Third Disaster Risk Management Development Policy Loan (DPL) with a Catastrophe Deferred Drawdown Option (Cat DDO) will help Colombia reduce disaster, climate, and public health risks. Exogenous shocks from disasters, pandemics, and commodity price adjustments can harm a country’s fiscal balance. An IBRD loan with a Cat DDO can help countries mitigate such risks by making a line of credit available to them.[...]