The Southeast Asia Disaster Risk Insurance Facility (SEADRIF) has joined forces with the Food and Agriculture Organization (FAO) to evaluate the potential of a regional Agricultural Risk Finance Facility (ARFF), in partnership with six ASEAN nations.
The initiative is designed to strengthen financial protection for the region’s agrifood sector, a key industry that supports over one-third of the workforce and contributes more than 10% of the region’s GDP. Despite its crucial role, agriculture currently receives only 3% of global climate finance.
SEADRIF and FAO aim to tackle this disparity by improving access to vital data, risk models, and insurance solutions. The collaboration focuses on overcoming challenges such as high transaction costs and affordability issues associated with premiums, which often limit broader access to financial tools for the sector.
The proposed regional approach could offer several advantages, including cost efficiencies, easier market access, more effective product development, and enhanced financial stability for participating countries.
The proposal, backed by the Green Climate Fund, was presented during the 10th-anniversary event of the ASEAN Climate Resilience Network. In the upcoming months, SEADRIF and FAO will carry out a pre-feasibility assessment to evaluate potential gaps and align the project with the objectives of the countries involved.
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