From fuel to farms: Angola aims to shift weight of oil economy by focusing on agriculture

After years of financial dependence on the fossil fuel sector, Angola is ready to reactivate its agriculture insurance market in a move to diversify its economy. And Swiss Re is ready to help.

As Africa's second-largest oil producer behind Nigeria, Angola has the potential to become a Sub-Saharan economic power.  But poor infrastructure, high poverty rate and the overall lingering effects of a 26-year civil war are just some of the issues that need to be addressed before the country can start on the road to financial security.

One step towards that goal is economic diversification. The Angolan government aims to gradually reduce the country's dependence on the oil and gas sector, which makes it vulnerable to volatile oil prices, by strengthening its agriculture sector.

Listening to those in the know

Smallholder farmers represent around 60% of the country's labor population, which means securing their income is not only of social importance, but economic as well. Agricultural insurance is vital to help farmers stay in business.

"Keeping farmers on the land through agricultural insurance will not only contribute to food security, but also help those who moved to urban centres in search of jobs return as farming will provide a source of income," said Lovemore Forichi, Senior Underwriter Agriculture at Swiss Re.

This relationship between farmers and agricultural insurance was the focus of a recent conference organised by Swiss Re with the support of the local insurer Nossa Seguros.  Attendees of the Luanda event included members of the Angolan Insurance Association, the Angolan Agency of Regulation and Supervision of Insurance, and the Ministry of Agriculture. Representatives from the Development Bank of Angola and the Angolan Union of Agricultural Cooperatives also participated.

"Agricultural insurance helps support the industry, helping farmers become more resilient to the local perils: floods, diseases and droughts," said Fabrice Jerlin, Swiss Re's Senior Market Underwriter in charge of Angola. "Insurance reduces income volatility and places community members in a position to improve their standard of living in the future."

"We're ready to provide Angola with our expertise to make this happen," Jerlin said.

Ready to work

Concrete steps are being taken to share this knowledge with the Angolan insurance industry: a task force is planned to define the roadmap needed to re-establish the agricultural insurance sector.

Swiss Re has been active in Africa for over 60 years and is committed to help unlock the potential of agriculture on the continent. You can learn more about our efforts in our publication Sub-Saharan Africa: breadbasket for a growing population.


Published 18 June 2014

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