Tens of thousands of farmers and livestock herders in East Africa will
soon have access to a financial product that might one day save their
businesses -- weather insurance.
IFC's Global Index Insurance Facility (GIIF) recently signed its first
partnerships in Africa to expand access to insurance to about 35,000
farmers and 5,000 herders in Kenya and Rwanda over the next three years.
Backed by the European Union and Netherlands, the facility will work in a
number of emerging markets with an initial focus on Sub-Saharan Africa,
where farmers and agricultural workers make up 60 percent of the
workforce but most cannot find crop coverage.
At a recent signing in Nairobi, Kenya, IFC conferred grants totaling
roughly $4.1 million from the GIIF trust fund on three partners in
Africa -- the Syngenta Foundation for Sustainable Agriculture; the
International Livestock Research Institute; and MicroEnsure.
The grants will fund advisory activities, including local capacity
building, infrastructure development, product development, and
development of local insurance companies’ capacity to provide
index-based insurance products.
Bernard Rey, Head of Operations European Union Delegation to Kenya,
said, “The implementation of these three first GIIF projects in Kenya
and Rwanda will support the development of new insurance products and
will increase expertise in this field, which will benefit smallholders
and livestock keepers affected by climatic events.
Protecting their Assets
The availability of weather insurance should have a significant impact
on farmers in emerging markets, protecting them against the effects of
climate change, which is predicted to intensify droughts, hurricanes,
If farmers can protect the value of their assets – the crops and land –
they can more easily earn the money needed to provide food, education,
and medical care for their families.
They will also enjoy improved access to finance to expand their
businesses, since banks and other financial institutors are more willing
to lend to farmers who are insured.
Jean Philippe Prosper, IFC Director for Eastern and Southern Africa,
said at the Nairobi signing, “These partnerships highlight IFC’s
commitment to expanding insurance and other financial products where
they are needed most in Africa. GIIF will facilitate farmers’ access to
credit, leading to increased productivity, improved livelihoods and
greater food security.
For more information contact:
Johannesburg, South Africa
Phone: +27 11 731 3120