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Africa is fighting challenges on many fronts – conflict, poverty, hunger, and climate change. The frequency and severity of these challenges is only expected to increase in the next few years.
Since 2014, African Risk Capacity (ARC) Limited as the financial affiliation of ARC Group, has been providing risk transfer solutions in the form of parametric insurance to assist countries in building resilience and mitigating the risk of natural disasters. ARC works with governments and aid agencies, and claims are paid out following a natural disaster, providing immediate funding for relief operations. The insurance policy taken by the aid agencies (called Replica Partners), complements the policy taken by the country and helps close the “protection gap”.
In the past year alone, four African countries have benefited from almost $60 million in payouts.

Malawi’s cluster approach

In June 2022, Malawi was paid out US$14.2 million. The funds were disbursed to ARC Ltd. Replica partner, the World Food Programme (WFP) for food assistance. ARC insurance is highly customisable. In 2021, ARC worked with the government to create four clusters based on the agro-ecological zones and a different insurance policy was issued for each.

The multi-faceted crisis in Mali

As an agricultural economy, Mali has been crippled by a recent drought and it is estimated that 1.9 million people are at risk of severe food insecurity. The situation is exacerbated by the ongoing conflict in the country. In March 2022, Mali received its first-ever payout, totalling US$7.1 million, disbursed to the WFP. This meant that more than 204 000 vulnerable people had access to relief.

Madagascar’s difficult start to 2022

Madagascar is one of the African countries hardest hit by the impact of climate change, due to its geographical position. Tropical cyclone Batsirai hit the country earlier this year and was the worst in three decades, leaving 121 people dead, and more than 61,500 displaced. Madagascar was the first African country to take up ARC LTD’s sovereign parametric cyclone insurance protection, launched in 2020.

Zambia to increase coverage

After prolonged dry spells in the 2021/2022 season, Zambia received its first-ever drought payout worth US$5.3 million in June 2022 to provide the government with food assistance. Provision of cash transfers was made to vulnerable households during the lean season. Only five out of 10 provinces were covered by drought insurance but the government is now looking to adopt the cluster approach.

With more participants, insurance products can become more cost-effective, but the challenge remains to bring more African countries on board for the greater good of all.

It is becoming increasingly clear that public-private partnerships are vital to tackling the fallout from climate change in African countries. The West African nation of Burkina Faso was recently assisted by such a partnership following devastating drought conditions from May to December 2021.

Estimates suggest a total of 3.3 million people in Burkina Faso are facing acute food insecurity brought on by the drought and several other factors, including a deteriorating security situation, forced displacement, and the Covid-19 pandemic.

A recent insurance payout of US$1.19m bolstered the Burkina Faso government’s emergency humanitarian response to the drought.

The need for planning
In 2019, Burkina Faso was one of four African countries to sign up for African Risk Capacity (ARC)’s parametric climate-change insurance – whereby a country can determine its immediate requirements in the event of a disaster with the coverage amount. This insurance covers weather-related perils, which are occurring more frequently and seriously on the continent due to climate change.

Burkina Faso is also supported by the World Food Programme (WFP), through the ARC’s Replica programme, whereby humanitarian agencies can replicate a government’s insurance. However, before taking out the policy, the agencies and governments must develop a contingency plan for how funds will be used once disbursed. As a technical partner, the WFP received the US$1.19m payout from ARC Ltd, which was used for the emergency response and to address hunger and malnutrition.

Burkina Faso has also benefited from other initiatives, offered in collaboration with the WFP. Strategically aligned with similar government policies and priorities, they are implemented in
a coordinated manner to manage and prevent food insecurity.

Among these initiatives are an emergency humanitarian response to resilience-building agricultural activities; development of community assets; improved market access; support for children's schooling; and the prevention of malnutrition.

This multi-faceted approach by ARC Replica partners and governments shows how such partnerships are possible, and indeed necessary, to boost support for vulnerable people on the continent and address climate-change issues.

Since December 2021, the Jeddah-based AAA-rated Islamic Development Bank (IsDB), has been proactively supporting international efforts to assist the people of Afghanistan via the Afghanistan Humanitarian Trust Fund (AHTF).
While the AHTF is awaiting member countries and international donors’ contributions, priority programs and projects are being developed in close cooperation with relevant partners working in Afghanistan. These efforts focus on a wide array such as alleviating poverty, improving health, promoting education, livelihood, rural development, agriculture, improving governance and projects facilitating women empowerment/inclusion, female education, and creating employment opportunities for the youth.

The establishment/operationalization of the AHTF was approved by IsDB Board of Executive Directors on 14 February 2022 in the wake of the 17th Extraordinary Meeting of the Foreign Ministers of the Organization of Islamic Cooperation (OIC), held on 19 December 2021 in Islamabad, Pakistan, where ministers from 57 countries discussed the situation in Afghanistan, and entrusted IsDB with establishing Operationalization and managing the AHTF in partnership with other international and regional stakeholders.

The Fund is adopting a holistic and sustainable approach to provide humanitarian assistance and basic services and support development and reconstruction activities to facilitate short, medium and long-term stability and self-reliance, support financial sectors, increase agriculture productivity, support healthcare systems, and involve the private sector.
As 76% of Afghanistan’s population lives in rural communities, a key focus will be to save lives by preserving rural livelihoods. Youth Employment as well as facilitating local entrepreneurs and development of the private sector will be a priority, too.

To formulate a viable operations pipeline, IsDB has been extensively consulting with implementation partners as well as other stakeholders. The Bank’s field office has been operational in the capital city of Kabul since January 2022. In May 2022, a delegation from the relevant IsDB Group Regional Hub, traveled to Kabul in coordination with the OIC, to explore initiatives and projects that can be potentially funded under the AHTF, to ensure maximal impact.

Sanofi is actively engaging in providing humanitarian support to Ukraine and neighbouring countries. Through its foundation, Sanofi has donated €5 million to the Red Cross and UNHCR. This will support emergency access to necessities such as food, shelter, medicine, and security, and will help receive and assist refugees from Ukraine.

Read more about Sanofi's response to the situation in Ukraine.

How does it work? The jobs for Ukraine platform is a free-to-post platform for any company looking to offer opportunities for displaced workers. An Adecco expert team of Ukrainian and English speakers is dedicated to support candidates and connect them with companies.

This platform is created as a solidarity initiative and not a classic commercial job board. Our aim is to help people and companies get in contact quickly, and not to do a full recruitment process. This service will have no cost for companies. And Adecco will never charge candidates for finding jobs Companies interested should apply through the platform. Our team will verify the companies and jobs posted before they are published on the site.

Read more here.

On Monday, leaders of some of the world's biggest humanitarian organizations called for continued – and additional – support for the displaced people pouring across Ukraine's borders, and warned that other crises around the world must not be forgotten.

Addressing a World Economic Forum Special Agenda Dialogue on the Humanitarian Situation in Ukraine, Kelly Clements, United Nations Deputy High Commissioner for Refugees (UNHCR), said a quarter of Ukraine's population has now been displaced.

She said conflict fatigue must be avoided; “Please let this not be temporary. We will need long term sustained support not just for this crisis, but for the many other refugee displacement crises around the world that continue and unfortunately, do not receive the support that they need.”

She called on companies to “engage their employees” and “channel the support in ways that assist organizations like ours to deliver relief on the ground very quickly”.

She spoke of matching schemes and pro bono support – on tech, legal advice and assistance with putting cash systems in place. “We couldn’t have done it without business”, she said.

Finally she asked companies to "use their voice" and highlighted the importance of advocacy in raising awareness on “why we should care as an international community” and why we should “stand together with people in need”.

Catherine Russell, Executive Director of the United Nations Children's Fund (UNICEF) reiterated the importance of the private sector.

She said, “The private sector has stepped up… which has been very reassuring and greatly appreciated because these needs continue to grow by the day.”

Watch the session in full here.

The European Bank for Reconstruction and Development (EBRD) has announced an initial €2 billion resilience package of measures to help citizens, companies and countries affected by the war in Ukraine. The Bank has also pledged to do all it can to help with the country’s reconstruction, once conditions allow.

Funding will be made rapidly available to support Ukrainian companies– for example, with deferred loans, liquidity support, and trade finance. Where possible, businesses will be helped to relocate so their work can continue.

In addition, the Bank’s Resilience and Livelihoods Framework will help in countries directly affected by inflows of Ukrainian refugees. Women, children and the elderly make up the majority of displaced citizens, and municipal authorities face huge challenges in managing the influx of people.

DTEK is working to keep the lights on for millions amid the war, as fighting is damaging energy infrastructure around Ukraine, with more than 200 cities in the east without heat or light. DTEK has also supplied free power to hospitals, the military and breadmakers in several regions since the start of the invasion.

DTEK’s crews have restored power to 300,000 people since the war began, but to reach and repair damaged infrastructure, DTEK’s repair crews need safe passage. Shelling has cut off power to the city of Mariupol – where 500,000 people there have been without heat or light for 8 days.

DTEK’s emergency crews are making an all-out effort to repair the city’s power - even a few hours’ supply enables people to charge their phones, but the fighting means it’s not safe enough for crews to reach the damage until they receive an all-clear from Ukraine’s military.

As well as restoring power, DTEK is maintaining supplies across the country after a Russian occupation of Ukraine’s Zaporozhia nuclear power station. DTEK has reactivated coal and gas plants to ensure energy continues to be supplied across the grid.

But Ukraine’s grid is isolated from its neighbours, and this makes it vulnerable. So Ukraine’s energy companies are also working to connect the grid to the rest of Europe to ensure the electricity keeps flowing.

Yara International CEO, Svein Tore Holsether, warns of an overdependency for supplies on Russia. He points to World Bank data highlighting that even though the current food supply is stable, food prices are increasing in most countries in the world. In 2020, around 800 million people went hungry to bed, representing an increase of 120 million people from 2019. Holsether says the war in Ukraine threatens to reinforce this development.

For a rapid scale-up of principled and effective humanitarian response in existing and new areas of Ukraine for a duration of three months from March to May 2022, humanitarian partners require $1.1 billion to help more than 6 million people in need.

Learn how the private sector can help in this brief UN Business Guide to the Ukraine Humanitarian Crisis.