eBusiness Weekly
Business Writer
Zimbabwe has scored a first in the region by becoming the first African Risk Capacity (ARC) member country to have two Replica partners for the next Pool VIII, as development partners show confidence in the country’s disaster risk management approach with the ARC Group, Finance and Economic Development Minister Professor Mthuli Ncube has said.
Zimbabwe has already benefited from its ARC membership that helps African governments improve their capacities to better plan, prepare and respond to extreme weather events and natural disasters.
Mthuli virtually told delegates from across the region at the ARC retreat in Victoria Falls that organisations such as the START Network and the World Food Programmes (WFP) had demonstrated the trust they have in Zimbabwe’s disaster risk management approach as the country continues to tap into ARC initiatives in its quest to improve resilience against natural disasters due to climate change.
This comes as Zimbabwe and the rest of the region have witnessed an increase in climate induced disasters such as droughts and tropical cyclones that have affected the agriculture sector and caused supply chain disruptions across value chains.
“There is increased urgency – a last chance if you will – to save our planet. Closer to home, as African nations we have called on the developed world to support us in climate financing to speed up decarbonisation and help us adapt to the climate crisis.
“We see the shift from a reactive disaster risk management response to a proactive approach as part of this adaption and building of resilience. This is where our involvement as an ARC Member State emerges as a key piece,” said Mthuli.
Zimbabwe benefited from ARC’s Ltd pool during the 2019/2020 agricultural season, which resulted in a US$1,4 million payout, complemented by a US$290 000, which was extended to the WFP and supported over 180,000 households in the highly vulnerable districts.
“Since then, we have not looked back. We have, in collaboration with partners including KFW and DFID, been purchasing sovereign policies, complemented by Replica Policies (from WFP and StartNET along their members) in Pools VI, VII and VIII,” he said.
He also encouraged other countries to consider participating in the organisation’s initiatives as this enhances resilience and response to climate shocks.
“Parametric insurance will deliver swift financial relief when natural disasters strike,” he said.
In 2019, Zimbabwe experienced Tropical Cylcone Idai and in addition to recent recurring droughts, which have also negatively affected Mozambique, Malawi and some parts Angola.
But the ARC’s insurance product provides relief when disaster strikes as its mandate is to build capacity towards revamping and strengthening disaster risk reduction of AU Member States.
He also highlighted the need for ARC to increase collaboration with the private sector and the importance of development partners support in any form possible to African Governments, particularly on the backdrop of the Covid-19 pandemic.
Said Mthuli: “I would like to encourage the ARC to continue exploring ways of developing resilience in Africa and increasing their presence in the insurance sector, especially targeting penetration through private arrangements with private insurance players or through reinsurance.
“This will not only deepen our financial markets over time, but should enhance the very essence of the insurance concept through risk pooling and sharing.”
The ARC Group, an initiative of the African Union (AU) enabled countries to strengthen their disaster risk management systems and access rapid and predictable financing when disaster strikes to protect the good security and livelihoods of their vulnerable populations.
