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Climate Change: UNDP Launches Risk Financing Facility in Mozambique

Climate Change: UNDP Launches Risk Financing Facility in Mozambique

The United Nations Development Programme (UNDP) and partners launched a risk financing and insurance mechanism in Maputo on Thursday 16 November to develop products and services capable of creating resilience to natural disasters in the country.

The platform is being implemented in 15 countries, including six African nations, including Madagascar and Malawi.

In the country, the mechanism will be implemented in close collaboration with different partners, to provide policy advice, guidance, tools and methodologies to increase resilience in the face of socio-economic shocks.

On the occasion, the head of the Environment, Climate Change and Resilience Unit at the UNDP, Eunice Mucache, justified the importance of this initiative with the fact that Mozambique faces a significantly high level of risk of natural disasters.

“In this specific case, it’s relevant because we are a territory exposed to disaster risks such as cyclones, floods and droughts. We have observed that it has been constant and more intense to see how cyclones affect the country, and this scenario is sure to get worse,” she said, quoted by the newspaper Noticias, adding, however, that this mechanism is expected to be a risk financing solution for small and medium-sized enterprises.

For the source, the initiative will improve the country’s ability to cope with natural disasters, both by seeking funding for actions immediately after they occur, and by developing resilience, looking specifically at insurance.

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For its part, the Ministry of Economy and Finance (MEF) pointed to the mechanism as part of a set of ongoing efforts aimed at offering resilience to the Mozambican economy, which is cyclically vulnerable to climate shocks.

“Both in terms of frequency and intensity, in recent years the effects of climate change have had a direct impact on public finances, which is why they have become a priority and have required various budgetary resources aimed at mitigating them,” emphasised Domingos Lambo, permanent secretary of the MEF.

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