The African Risk Capacity (ARC), an agency of the African Union (AU), and the UN Economic Commission for Africa (ECA) this week announced a new partnership to increase insurance coverage against climate risks for African states.
The multilateral deal commits ARC and ECA to build the capacity of their 33 common member states by embedding risk management investments into government planning through policy development, according to an ECA official.
The ARC and the ECA will share expertise and commit financial resources to joint analytical work in areas of economic and climate risk research in order to promote risk transfer instruments.
The UN estimates that Africa will see the adaptation costs of climate change rise to 50 billion U.S. dollars per year by 2050.
“This partnership marks a bold new phase of heightened collaboration on combating the effects of climate change in Africa,” said Mohamed Beavogui, Director-General of ARC Agency. “The future of disaster risk management is an increasingly urgent economic issue, and ECA’s unique expertise will complement ARC’s work serving its member states and building preparedness and resilience on the continent,” said Beavogui.
In the four years that ARC has offered insurance coverage to its Member States, it has paid out more than 34 million U.S. dollars to member states affected by drought events. These resources have assisted over 2 million people affected by climate disaster. “Climate change is one of the biggest threats to Africa’s economic and social development,” said ECA Executive Secretary Vera Songwe. “We believe that efforts like our partnership with ARC will help move the needle, so that African countries can be well-guarded against these threats, and they can thrive,” she said.