Sri Lanka is vulnerable to climate-related extreme events and other hazards, including floods, droughts, cyclones, heat waves, and extreme rainfall. These hazards affect lives and livelihoods, infrastructure, and economic stability across the country. Climate impacts are pronounced across major economic and livelihood  sectors such as agriculture, tourism, or the fashion and apparel industry. Additionally,  micro, small, and medium enterprises (MSMEs) form a significant part of Sri Lanka’s economic base and are among the most exposed to climate and disaster risks.

Climate and disaster risk finance and insurance (CDRFI) instruments or mechanisms enable governments, businesses, and communities to better manage these complex risks. For example, risk financing mechanisms, climate insurance solutions, contingency financing, and innovative financial protection approaches can help to reduce economic and non-economic losses and improve recovery following climate-related shocks.

Under a multi-year project supported by the German Federal Ministry for Economic Cooperation and Development (BMZ), SLYCAN Trust initiated the Multi-Actor Partnership on Climate and Disaster Risk Management and Finance (MAP) in Sri Lanka. In the context of the ongoing multi-year project, this MAP aims to strengthen the enabling environment for CDRFI in Sri Lanka through research, policy engagement, and multi-stakeholder collaboration.

The work so far contributed to improving awareness and understanding of CDRFI mechanisms, strengthening dialogue and knowledge management, and convening actors from government institutions, the finance and insurance sectors, the private sector, civil society, and academia to collaborate and identify solutions towards climate resilience. As the second phase of the project concludes in 2026, there is an opportunity to take stock and share key findings and lessons emerging from the work so far.