Zimbabwe is set to unlock a maximum insurance cover of US$20 million from the Africa Risk Capacity (ARC) under the AU and financed by African development Bank (AfDB), this year.
The ARC provides capacity building on preparedness for climatic shocks, as well as insurance against risks such as drought.
“This insurance pay-out will assist farmers’ preparedness in the event of unexpected climatic shocks resulting in crop and livestock failure therefore farmers should secure weather-based index insurance to protect their businesses through managing such risks.
“Government on its part subscribed to the Africa Risk Capacity (ARC) under the AU and financed by AfDB and other various sources,” said Minister of Finance and Economic Development, Professor Mthuli Ncube.
Having received a total pay-out of US$1 755 890 last season, the Government assisted the country’s vulnerable households in selected districts, through disbursement of unconditional cash transfers, assistance to food insecure, labour-constraint households in the worst drought affected wards.
“A total of 77 767 households from Masvingo, (Chivi), Mat North (Binga), Mat South (Bulilima), Manicaland (Buhera) and Mashonaland East (UMP) benefited from the scheme,” he added.
For the 2020/21 season premiums payment, ARC facilitated application of premium subsidy from KfW of the German Government.
KfW of the German Government and the World Food Programme (WFP) committed to premium financing of US$2 million to support Zimbabwe, whilst the government contributed US$500 000 towards premium financing.
According to Prof Ncube, this year’s pay-out will be used to help vulnerable food insecure families as well to drill boreholes in remote areas.
Additionally, Government is also entertaining thoughts of using part of the ARC funds to rehabilitate irrigation projects in the country.
Government has, to date, invested millions under the National Accelerated Irrigation Rehabilitation and Development Programme, which seeks to exploit irrigable potential in every district as part of its drought proofing strategy.