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Contributions from
the Column
Monitor
No universal blueprint
Growing support for
taxing airline tickets
Avian flu lessons from Europe
“Alternative development”
often stops short
Wolrd Bank proposes active
poverty reduction
Zimbabwean success in
fighting HIV/AIDS
Nature conservation fund for
the South Caucasus
German development budget
expected to rise in 2006
DAC publishes
Annual Report 2005
Wold Food Programme buys
drought insurance for Ethiopia
04/2006
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Wold Food Programme buys drought insurance
for Ethiopia
The World Food Programme (WFP) has insured itself against the consequences of a severe drought in Ethiopia with
French insurance company AXA Re. If the rainfall measured by 26 weather stations throughout Ethiopia remains below
a certain level up to October this year, the WFP will receive $ 7.1 million from AXA. The damage done by a drought
that would trigger the payment would have to be as severe as during the drought in 1984, which claimed the lives of
thousands of Ethiopians. The AXA money would be available immediately to support affected farmers.
According to the New York Times, the insurance premium paid by WFP to AXA amounts to $ 930,000. Richard Wilcox,
Director of WFP Business Planning said: “This contract heralds the beginning of what may be an entirely new way of
financing natural disaster aid.”
The approach is similar to the UN Development ProgrammeÕs “New Public Finance” concept, which recently called for
a greater utilisation of private sector tenders to finance public tasks (see D+C/E+Z 3/2006, p. 128). Development
experts in Addis Ababa have criticised the policy. According the New York Times, they say the WFP had better used
the money to buy food.
(ell)
On the internet:
www.wfp.org
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