The African Development Bank Group (AfDB) has committed $23 million (about K39.8 billion) to Malawi in the next phase of its Africa Disaster Risk Financing (Adrifi) Programme.
AfDB country manager for the Malawi, Macmillan Anyanwu, said in an interview yesterday that the amount will cover drought, floods and other climate-related disasters.
He spoke at Sunbird Mount Soche in Blantyre at the start of a three-day high-level forum on climate disaster risk financing and insurance organised by AfDB in collaboration with the Malawi Government.
Said Anyanwu: “I think the interesting thing about the next phase of the programme for Malawi is that we are moving beyond providing sovereign risk insurance to also go into community level and individual level where farmers would have insurance.
“This will ensure that whenever disasters hit, we are not only going to make a payout to the government, but rather, we are also going to make payouts at community level”.
He said in the previous phase of the programme, which was established by the AfDB Group in 2018, Malawi received $16 million.
The programme was initially established to build the resilience and response of AfDB’s regional member countries against climate shocks.
AfDB partnered with the African Risk Capacity Group in implementation of the programme with the aim of safeguarding development in Africa through protecting countries and populations at risk from climate-related disasters with insurance cover.
Anyanwu said since its establishment in 2018, the programme has been an important innovative tool that has helped AfDB member countries who are often plagued with climate related disasters.
But while acknowledging that payouts are not sufficient, he said it is important that countries start thinking about systematic ways of managing and mitigating risks.
Representing the Malawi Government, Ministry of Finance Principal Secretary for Administration Heatherwick Njati said while climate shocks are not a strange phenomenon, they do not only damage Infrastructure and livelihoods.
He said this is besides setting back years of progress in development.
Said Njati: “It is, therefore, clear and evident that traditional approaches are no longer sufficient. We need innovative, scalable and inclusive solutions that will provide a robust safety net for the most vulnerable populations.
“It is within this context that the need for innovative and sustainable solutions, such as climate disaster risk financing and insurance becomes all the more urgent.”
He said Malawi is willing and eager to learn from fellow AfDB member States on some of the best practices on climate disaster risk financing and how the integration into development frameworks is being done.
Through the Adrifi programme, AfDB has invested more than $100 million to help 16 African countries secure risk insurance policies for national governments against drought and tropical cyclones.
The forum, which goes into its second day today, is being held under the theme ‘Harnessing opportunities of the evolving climate disaster risk financing insurance in Africa’.
