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Press Release from 2018-12-17 / Group, KfW Development Bank

Preparing for extreme weather: KfW bolsters Ethiopian agricultural sector with protective measures against climate risks

  • EUR 20 million to expand Rural Resilience Initiative (R4) of the World Food Programme
  • Drought insurance, erosion prevention and microloans benefit 130,000 households in northern Ethiopia
  • A secure food supply for the rural population

On behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) and together with the World Food Programme of the United Nations (WFP), KfW today signed a financing agreement worth EUR 20 million. Financed by the special initiative "ONE WORLD – No Hunger", this constitutes an extension of the Rural Resilience Initiative (R4) founded by WFP and Oxfam and supports the Ethiopian agricultural sector in those regions that are especially exposed to extreme weather conditions. The project is part of the G7 InsuResilience initiative that pursues the goal of protecting the rural population worldwide against climate risks, thus making a substantial contribution to securing the food supply in rural regions.

"Agriculture in Ethiopia, on which over 85% of the population directly or indirectly depend, is particularly vulnerable to climate risks. In rural areas, agriculture is generally the only sector that provides a source of employment and income. Thus is it all the more important to equip the rural population for climate risks and the associated crop failure, and in this way safeguard the food supply in affected regions," says Prof. Dr Joachim Nagel, Member of the KfW Group Executive Board.

The holistic R4 approach comprises four measures for better handling of weather risks: residents are offered both economically and financially sustainable drought insurances; and protection measures are being introduced to prevent erosion and retain water during heavy rains, all of which work together to reduce the target group's vulnerability to weather risks. Above and beyond this, small farmers can invest in the diversification of their income with microloans, for example, by purchasing a bee colony for honey production and sale. Farmers are also given special training to encourage them to save when possible, thereby creating a nest egg in the event their crop fails.

Currently around 30,000 households in northern Ethiopia are benefiting from the resilience programme. The target group will be increased to a total of 130,000 households through the extension made possible by this Financial Cooperation project.

More information on KfW Development Bank is available at: www.kfw-entwicklungsbank.de/International-financing/KfW-Entwicklungsbank/