A new partnership between the International Finance Corporation (IFC) and the Insurance and Pensions Commission (IPEC) is expected to boost agricultural insurance for smallholder farmers in Zimbabwe.
It was gathered that the IFC, a member of the World Bank Group, partnered with the local insurance industry to create tailor-made insurance products for smallholder farmers to protect them from the vagaries of climate-induced losses.
‘Agriculture is central to Zimbabwe’s economy, but it is a risky endeavour that is becoming riskier as weather patterns become less predictable’, IFC’s Country Manager for Zimbabwe, Adamou Labara, said.
‘IFC’s partnership with IPEC will reduce the risks for Zimbabwe’s farmers by developing the foundation of agriculture insurance in the country. Supporting the agribusiness sector is an important part of IFC’s strategy to promote private sector growth across Africa’.
Data from the Food and Agriculture Organisation (FAO) shows that agricultural activities provide employment and income for 60 percent of the population, contributes approximately 17 percent to Zimbabwe’s GDP and is the main source of livelihood for the majority of the population.
However, climate change hazards such as hailstorms, strong winds, dry spells and floods negatively affect crop yields and agricultural activities in the southern African country.
Data from IPEC also shows that although agricultural insurance has huge potential for development of the agricultural sector in Zimbabwe, agriculture insurance penetration remains extremely low in the country.
‘One of our key roles as the regulator is to develop the insurance sector in Zimbabwe’, IPEC Commissioner, Grace Muradzikwa, said.
‘This partnership has, therefore, come at an opportune time given that the country is prone to climate change-related risks, including extreme weather events such as drought, floods, heavy rainfall and heat waves’.
IPEC develops agricultural insurance solutions to promote sustainable agriculture practices and benefit Zimbabwe’s smallholder farmers.
IFC also said it will draw on the experience of the Global Index Insurance Facility (GIIF), through which it has supported the growth of agriculture/climate insurance markets in Cameroon, Ivory Coast, Mozambique, Nigeria, Senegal, Zambia to make the Zimbabwe project a success.
Source: New Zimbabwe
Photo source: Borgen Project
