The Southeast Asia Disaster Risk Insurance Facility (SEADRIF) and the Food and Agriculture Organization (FAO) have joined forces with six ASEAN nations to evaluate the feasibility of creating a regional Agricultural Risk Finance Facility (ARFF).
This collaborative effort seeks to strengthen financial protection for Southeast Asia’s agrifood sector, a crucial industry that employs over a third of the region’s workforce and contributes more than 10% to its GDP. Despite agriculture’s vital role in the economy, it receives a disproportionate share of global climate finance, with only 3% allocated to the sector.
Through this partnership, SEADRIF and FAO aim to tackle challenges such as limited access to essential data, inadequate models, and barriers to insurance availability. Their goal is to make insurance products more accessible, reduce transaction costs, and address affordability concerns for farmers and agribusinesses.
The proposed regional approach is expected to offer several benefits, including cost savings, streamlined access to markets, improved product development, and greater financial stability for participating countries. The initiative also enjoys funding support from the Green Climate Fund.
The feasibility of this initiative was discussed during the 10th anniversary event of the ASEAN Climate Resilience Network. In the coming months, SEADRIF and FAO will conduct a pre-feasibility assessment to identify potential gaps and align the project with the objectives of the participating countries.
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