IFC provides 3.9 mln USD grant to expand crop insurance in E.Africa
05 February 2014, 20:05
Nairobi - The International Finance Corporation (IFC) on Wednesday announced a 3.9 million U.S. dollars grant facility to expand weather insurance to one million farmers in Kenya, Rwanda and Tanzania.
A partnership with the Syngenta Foundation for Sustainable Agriculture will ensure that a critical mass of smallholders in the east African region have access to the index based insurance.
"The index based insurance scheme will buffer East African farmers against negative impacts of climate change including droughts and fiery storms. It will strengthen food security and promote sustainable development," IFC Manager for Access to Finance in Sub-Saharan Africa, David Crush told journalists in Nairobi.
The new grant was issued by the Global Index Insurance Facility, a multi donor trust fund financed by the European Union, Japan and Netherlands and implemented by the Bretton Woods Institutions.
Crush noted that the new index based weather insurance is a more efficient and financially viable risk management tool for farmers.
"Index insurance helps to strengthen the livelihoods of small scale farmers, which is one of the most important tasks in the quest to fight poverty and foster inclusive and sustainable economic growth in Africa," Crush said.
He underscored the role of crop insurance, technology and affordable credit to transform agriculture in the region. Rain fed agriculture in the region is vulnerable to climatic shocks hence a spike in hunger and malnutrition.
The Executive Director, Syngenta Foundation for Sustainable Agriculture, Marco Ferroni noted that crop insurance has inspired farmers to scale up investments in food production.
"The support from IFC and EU has been instrumental in the expansion of our index insurance program. Insurance is crucial to protect farmers' investments in their land," Ferroni told journalists.
The Swiss based not for profit organization has been implementing an agricultural index insurance initiative targeting 187,000 Kenyan smallholders.
Ferroni revealed that the Syngenta Foundation will partner with one acre fund, a micro finance institution, to implement the Index based weather insurance project in the region.
"We have partnered with aggregators like one acre fund to enable farmers access the insurance facility at an affordable premium of 25 dollars per care in every planting season," said Ferroni
He added that access to crop insurance will accelerate the commercialization of farming in the region.
There is need to transform agriculture in the east African region to boost farmers' revenue, achieve food security and sustainable economic growth.
The Head of Agriculture and Rural Sector Development, EU Delegation in Kenya, Dominique Davoux, challenged countries to harness technology and innovations to promote food production.
"This region faces a grim food situation due to erratic weather patterns, inadequate funding and slow adoption of technology. Insurance, access to credit and innovations will transform farming into a sustainable enterprise," Davoux said.