The government of Malawi has recently obtained an insurance payout of $11.2 million due to the severe El Nino-related drought that pushed the southern African nation to declare a state of disaster earlier this year. This payment was facilitated by the African Development Bank and received this month, marking a significant step in addressing the crisis. The insurance policy was in partnership with the African Risk Capacity Group, an organization of the African Union.
These funds are crucial in providing food assistance to approximately 235,000 households in the most affected regions of Malawi. Moreover, the money will also be utilized for direct relief payments to more than 100,000 households, creating a vital safety net for the vulnerable populations in the country. President Lazarus Chakwera emphasized the importance of this payout, stating that it serves as a lifeline for those facing hardships.
The devastating drought, attributed to the El Nino weather phenomenon that persisted for a year until June, has severely impacted Malawi, already known as one of the world’s poorest nations. The agricultural sector has been particularly hit hard, with crops failing across the region due to below-average rainfall experienced between November and April. Small-scale farmers, who form the backbone of the economy for tens of millions of people in southern Africa, have been struggling to feed themselves and earn a living.
The Southern African Development Community (SADC) reported at a recent summit in Zimbabwe that approximately 68 million people, which accounts for 17% of the region’s population, are in need of assistance due to the ongoing drought crisis. The U.S. Agency for International Development highlighted that the first quarter of this year witnessed the most severe drought experienced in southern Africa in over a century.
Other nations in the region, such as Zambia and Zimbabwe, have also declared states of disaster and requested international aid. Mozambique, Zambia, and Zimbabwe are anticipated to receive drought insurance payouts by September, as outlined by the African Development Bank. However, the funds allocated may not be adequate to fully address the magnitude of the crisis. For instance, Zimbabwe is expected to receive $31.8 million from the insurance policy, yet the government had requested $430 million in humanitarian assistance back in May.