African Risk Capacity, AfDB to cooperate on natural disasters
The African Risk Capacity has signed a memorandum of understanding with the African Development Bank (AfDB) and the Inter-African Conference on Insurance Markets (CIMA) to collaborate in the areas of planning, preparation and response to extreme weather events and natural disasters.
The ARC, a specialized agency of the African Union for natural disaster planning and response established in 2012, said the MoU which is expected to benefit the Regional Member Countries of the AfDB, represents a major step towards its goal of providing $2 billion in annual climate disaster coverage to Africa’s most vulnerable populations and insure 150 million people across 30 countries on the continent by 2020.
The agreement was signed on May 25, after a high-level panel on “Climate and Disaster Risk Financing: Innovation for the Continent” at the AfDB’s Annual Meeting in Lusaka, Zambia.
The ARC said in a statement by its Director General Mohamed Beavogui, and Governing Board Chair Dr Ngozi Okonjo-Iweala: “The collaboration is expected to play a pivotal role in protecting investments for economic growth especially in key economic areas vulnerable to weather shocks such as agriculture. The Letter of Intent will support the introduction and mainstreaming of disaster risk financing into national fiscal policy in Member States.”
The statement said the MoU with CIMA, the regulatory and insurance body for 14 countries in West and Central Africa, is for cooperation on a number of areas including training of officials and technicians from ARC Member States on index-based insurance products for governments, establishment of working groups to study and implement strategies related to weather-index based risk coverage, and promoting weather-index based insurance products for access to traditional insurers.
According to the African Risk Capacity, seven countries have so far purchased insurance from ARC Ltd – Niger, Senegal, The Gambia, Mali, Malawi, Mauritania and Kenya – and it intends to launch a tropical cyclone insurance product this year and a flood insurance product in 2017 in a bid to increase insurance coverage across Africa.
By Emmanuel Odonkor