Suva, Fiji 26th August 2020
The India UN Development Partnership Fund, managed by the United Nations Office for South-South Cooperation, has pledged FJ$1.8 million (~US$ 850,000) to support a new initiative to create a climate disaster risk financing framework for Fiji. This new initiative, named the 'Developing Climate Disaster Risk Financing framework and Parametric Insurance" aims to alleviate economic damage caused by climate and extreme weather events.
The increasing frequency and intensity of climate-fuelled natural hazards in Fiji and the rest of the Pacific has had devastating economic consequences. In 2016, Tropical Cyclone Winston is estimated to have caused USD $0.9 billion damage to the Fijian economy. The estimated financial loss of Tropical Cyclone Harold, which happened in April of this year, is still being assessed but is expected to run into millions of US dollars.
To minimize the economic damage caused by future climate-related disasters, the project will develop index-based insurance and other climate disaster risk financing instruments for individuals, businesses and organizations in Fiji. The initiative, led by the Climate Change and International Cooperation Division of the Fiji Ministry of Economy, will be jointly implemented by the United Nations Capital Development Programme (UNCDF), together with the United Nations Development Programme (UNDP) and the United Nations University (UNU)-managed Munich Climate Insurance initiative (MCII).
“Major climatic events like cyclones can deliver sudden and unplanned shocks to any government’s financial planning. Too often, the multilateral financial tools at our disposal are ill-equipped to respond expeditiously to these events. When a Fijian’s home is blown over or their crops are washed away they cannot afford to watch assistance slowly drip through inflexible disaster risk finance frameworks; they need those funds immediately. Insurance products not only guarantee those payments quickly, they grant private sector partners a vested interest in seeing Fijian communities strengthen their resilience to climate impacts,” said Fijian Attorney-General Aiyaz Sayed-Khaiyum.
The Attorney-General also thanked the Government of India and the United Nations for their foresight in helping Fiji transcend the inherent obstacle of scale in developing climate insurance products.
The India-UN Development Partnership Fund, sponsored by the Government of India and implemented in collaboration with the United Nations system, with the United Nations Office for South-South Cooperation (UNOSSC) as the coordinating partner is advancing all 17 Sustainable Development Goals (SDGs) by contributing resources and expanding partnerships for development cooperation in the Global South. Through this partnership with Government of Fiji and UNCDF, in addition to funding, India will also share knowledge as a part of their support. This project will organize a number of learning visits to India. Parametric crop insurance is well developed in India, and these trips will offer a chance to learn from this experience while building opportunities for collaboration between Fijian and Indian companies.
The Indian High Commissioner to Fiji H.E. Ms. Padmaja said that “during his interaction with the Leaders of the Pacific Small Island Developing States (PSIDS) at New York in September 2019, Prime Minister of India Hon. Narendra Modi had announced US$1 million for each country for projects in the area of their choice. It is a matter of great satisfaction that we have fulfilled that commitment in a timely manner. Hon. PM had also invited Leaders of PSIDS to join the Coalition for Disaster Resilient Infrastructure (CDRI). Innovative solutions are needed to prepare for the economic effects of climate change and to increase the disaster resilient financial solutions as well. This project will surely help to drive the development of those solutions and facilitate learning between the two countries.”
The initiative will be launching in August, for more information please contact pfip@uncdf.org.
The United Nations Office for South-South Cooperation (UNOSSC) is the United Nations system-wide advocate, coordinator and facilitator of South-South cooperation. UNOSSC supports multilateral South-South policy-making processes; strengthens capacities of Member States to initiate, manage and implement South-South cooperation; and facilitates partner-led and -funded programmes. UNOSSC manages and serves as the Board of Directors Secretariat for the India-UN Fund as well as for a number of other South-South cooperation funds.
Website:
https://www.unsouthsouth.org/partner-with-us/india-un-fund/
About UNCDF
The United Nations Capital Development Fund (UNCDF) makes public and private finance work for the poor in the world’s 47 least developed countries. With its capital mandate and instruments, UNCDF offers “last mile” finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development.
UNCDF’s financing models work through three channels: (1) inclusive digital economies, which connects individuals, households, and small businesses with financial eco-systems that catalyze participation in the local economy, and provide tools to climb out of poverty and manage financial lives; (2) local development finance, which capacitates localities through fiscal decentralization, innovative municipal finance, and structured project finance to drive local economic expansion and sustainable development; and (3) investment finance, which provides catalytic financial structuring, de-risking, and capital deployment to drive SDG impact and domestic resource mobilization.
By strengthening how finance works for poor people at the household, small enterprise, and local infrastructure levels, UNCDF contributes to the Sustainable Development Goals—SDG 1 on eradicating poverty and SDG 17 on the means of implementation. By identifying those market segments where innovative financing models can have transformational impact in helping to reach the last mile and address exclusion and inequalities of access, UNCDF contributes to a broad diversity of SDGs. Visit us at www.uncdf.org, follow @UNCDF and subscribe for updates at
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