Enterprise Television- AfDB Unveils Disaster Risk Financing Initiative
The African Development Bank (AfDB) has approved a new Africa Disaster Risks Financing (ADRiFi) programme.
ADRiFi is AfDB’s first climate risk management programme to boost resilience and response to climate shocks on the African continent and seeks to facilitate initial financing for countries in need of support, with the programme’s initial phase expected to run from 2019 to 2023.
In a statement, the bank said the comprehensive programme, open to regional member countries, will enhance their ability to evaluate climate-related risks and costs, respond to disasters and review adaptation measures at both national and sub-national levels.
Director for Agricultural Finance and Rural Development, AfDB, Atsuko Toda said “Africa is the most vulnerable continent to climate change, prone to a wide variety of natural disasters including droughts, floods and tropical cyclones. However, disaster risk management suffers from inadequate financing and challenges in the deployment of available funds.”
She added “This programme is a significant step to help reduce exposure and vulnerability of African countries, and will create a system to absorb, adapt and aid recovery of these countries from climate shocks.”
The enhanced resilience and adaptation of countries to the negative impacts of climate change, as well as disaster risk insurance cover, will reduce the vulnerability of the poor to climate change and act as a safeguard against loss of livelihoods in communities, especially for smallholder farmers.
However, nine countries in likes of Burkina Faso, Chad, Gambia, Madagascar, Malawi, Mali, Mauritania, Niger and Senegal, have so far, expressed interest in participating in the programme ADRiFi will promote disaster response mechanisms such as sovereign parametric index-based insurance, for which payouts will be disbursed automatically and in timely manner when a pre-defined risk threshold is exceeded.
It is estimated that every US$ 1 spent on ex-ante intervention through the programme will save US$4.40 in ex-post disaster relief measures for a response carried out six months after the event.
The ADRiFi programme is also aligned with the AfDB’s ‘High 5’ priorities, particularly “Feed Africa” and “Improving the Quality of Life of Africans”. It is also aligned with the Bank’s Climate Change Action Plan II (2016-2020) policy.
As part of processes to accelerate the programme, the bank also signed a Memorandum of Understanding with the African Risk Capacity (ARC) to cooperate in preparing, developing and implementing projects and programmes in climate change and risk resilience in member countries.
As a key partner, ARC will assist member countries with policies on drought risk pools and other sovereign disaster risk measures.