By: Momodou Justice Darboe
The Gambia Government Coordinator of the Africa Risk Capacity (ARC), Mr. Mawdo Amadou Jallow, has highlighted the need for The Gambia to affect a radical shift from over-dependence on government budget in transferring drought risk premium payment.
In opening remarks at a two-day workshop on Risk Transfer Parameter’s Validation workshop, GC Jallow said: “This workshop is important, important for the fact that after having gone through a lot of processes, one of which was to quantify our risk, now we are here to determine how much of that risk we are going to transfer to African Risk Capacity Ltd. It is the liability company of the ARC group. However, some weeks ago, the director of climate finance [ Ms. Isatou Camara] had this opinion that we have been retaining too much of our risk as a government, making it very difficult for us to get a payout because the idea of insurance is a quick disbursement mechanism. When you get a trigger, you get a payout. That helps you to manage your risks in terms of supporting vulnerable populations that are affected by, in our case, drought. You have already determined the reference crop, which is the groundnut, and you have determined all parameters, including how much risk we are going to transfer to the company. Just to tell you, this time we will not be limited because of the government budget. I think, thanks to Ms. Camara and her directorate, of course, the Ministry of Finance, we have secured a collaborative effort that may or is likely to support us in terms of premium payment in addition to the government budget. Already, we know we have 200,000 dollars available at the Ministry of Environment. We should not be limited to that budget.”
According to Jallow, The Gambia should now go further and see how much risk it should transfer, “but not risk transfer based on budget, but risk transfer based on what is realistic, that can take on board most of our risks”.
He pointed out that even if The Gambia is to retain its risk, it should not be at least more than 60%.
“We should try to look into those scenarios as you go into the workshop. We used to have three options but I want to impress on you as opposed to what used to happen so that this time, we have four to five options and not one based on budget as the case has been because we are limited as a government because of budget and now that donors are very, very likely to support us. We should see how many percent of our risk we are going to cede,” CG Jallow underlined.
“I want to take this opportunity to thank the directorate of climate finance at the Ministry of Finance and, of course, the Ministry of Finance staff from the minister down, for all the support they have given to the program. This is a national program, it’s a government program but managed by the NDMA, and on behalf of the executive director of NDMA, I want to thank all the stakeholders for doing a fantastic job, be it rainfall, be it vulnerabilities, the data in terms of yields,” he added.
The government coordinator of ARC program also thanked the agriculture and gender ministries in terms of contingency planning and all other stakeholders, who have input in the risk that the country has quantified.
“It should now pave the way for us to be able to layer that risk and see how much of that risk we are going to transfer. On behalf of the Gambia Government, the National Disaster Management Council, the NDM, headed by the executive director Sanna Dahaba,” he concluded.
Speaking earlier, the Underwriting Analyst at the Africa Risk Capacity Limited, Wesley Chitsike, thanked the Government of The Gambia, the technical working group, Gambia Government coordinator of the ARC national program and the executive director of NDMA for the continuing participation of The Gambia in ARC programmes.
“We are here today for RCP parameter selection, a key process in our program to select the amount of risk you guys want to transfer to the risk market,” he highlighted.