Arab Monetary Fund sets guidelines for central banks to deal with natural disasters and climate change – The National

  • Date: 22-Jun-2020
  • Source: The National
  • Sector:Financial Markets
  • Country:GCC
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Arab Monetary Fund sets guidelines for central banks to deal with natural disasters and climate change – The National

Arab Monetary Fund sets guidelines for central banks to deal with natural disasters and climate change. Abu Dhabi-based institution encourages greater cooperation with research centres modelling risks associated with natural and climate-related disasters. Central banks in the Arab world should develop a comprehensive governance framework in dealing with natural disasters and climate change-related calamities to ensure the stability of the financial system, according to the Arab Monetary Fund.. The Abu Dhabi-based institution released a new report setting guidelines for central banks in dealing with the implications of natural disasters and climate change on the banking system and financial stability.. "Central bank should adopt a comprehensive governance framework in managing natural disasters and ramifications of climate change and addressing the potential impact," the AMF said.. It also recommended that an ad-hoc, specialist natural disaster management committee should be set up within central banks, whose tasks include the preparation of a recovery plan.. Natural disasters and climate change challenges have gained the attention of regulatory authorities across world due to the potential impact on financial stability.. The International Monetary Fund has classified climate-related risks affecting the banking sector and financial stability into two categories - physical risk and transformation risk.. The Institutional