Malawi receives an insurance payout of $11.2 million for El Nino-linked drought disaster

The Malawian government has received a $11.2 million insurance payout due to a severe El Nino-induced drought, which led the country to declare a state of disaster earlier this year, the African Development Bank announced on Monday. The payout comes from Malawi’s drought insurance policy, underwritten by the bank and the African Risk Capacity Group, an African Union agency.

The funds will be used to provide food assistance to approximately 235,000 households in Malawi’s most affected areas and to offer direct relief payments to over 100,000 households. Malawian President Lazarus Chakwera described the payout as “a lifeline for our vulnerable populations.”

Malawi, one of the world’s poorest countries, has seen its food supply devastated by the drought, which is linked to the El Nino weather phenomenon that persisted for a year before ending in June. The government declared a state of emergency in March, highlighting a food crisis in 23 out of the nation’s 28 districts.

Across southern Africa, crops have failed as El Nino caused below-average rainfall between November and April. Millions of people in the region, who rely on small-scale farming for sustenance and income, have been severely affected.

At a summit in Zimbabwe, the Southern African Development Community (SADC) reported that about 17% of the region’s population—around 68 million people—are in need of aid due to the drought. The U.S. Agency for International Development noted that the first quarter of this year brought the most severe drought in southern Africa in over a century.

Other countries in the region, including Zambia and Zimbabwe, have also declared states of disaster and appealed for international assistance. The African Development Bank stated that Mozambique, Zambia, and Zimbabwe are expected to receive drought insurance payouts by September. However, these payouts may not be sufficient. Zimbabwe, for example, will receive $31.8 million, far short of the $430 million it requested in humanitarian aid back in May.

  • Muthomi Ireri

    Manager, Planet GIM

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