partnership arrangement for enhancing agriculture risk management and praedial larcency agendas in...
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PARTNERSHIP ARRANGEMENT FOR ENHANCING AGRICULTURE RISK MANAGEMENT AND PRAEDIAL LARCENCY AGENDAS IN THE REGION.
DR. VINCENT LITTLE COORDINATOR,IICAs CARIBBEAN TECHNICAL AGENDA
TABLE OF CONTENT Background
CARM Strategy
Agricultural Insurance Agenda
Praedial Larceny AgendaBACKGROUND Caribbean Region is comprised mainly of:Small Island Developing States (SIDS) andLow Lying Coastal States (LLCS)
Second most prone region in world to natural disaster
Region experiences regular annual losses due to natural events in the order of US $3.0 billion.DAMAGE DONE TO THE AGRICULTURAL SECTOR COUNTRYDISASTERESTIMATED VALUEDOMINICALuis and Marilyn (1995)US $ 12 millionGRENADAIvan (2004)US $ 36.6 millionGUYANAFloods (2004/2005)
Floods (2005/2006)US $ 54.5 million
US $ 22.5 millionJAMAICAGilbert (1988)J $ 1.66 billionST. KITTS/NEVISLuis (1995)US $ 15 millionST. LUCIAAllen (1980)
Dean (2007)US $ 16.9 million
US $ 10 millionMAJOR HURRICANES IN THE CARIBBEAN BY DECADE, 1970-2008CATEGORIES OF HURRICANE1970-19791980-19891990-19992000-2008CATEGORY 3971110CATEGORY 4371212CATEGORY 53327TOTAL15172529INCREASED ECONOMIC COSTS TO THE SECTOR DUE TO:Increased capital assets accumulation within the sectorStrengthened inter-sectoral linkagesIncreased persistent povertyContinued demographic growth and shiftsMigration towards coasts and river-beds of mega-citiesIncreased probability of occurrence of severe weather eventsTHE JAGDEO INITIATIVEIn 2003, President Jagdeo asked IICA and FAO to assist in the development of a framework for a regional agricultural repositioning strategy.
25th CHG (July/04) Heads endorsed the Framework Proposal, which contained the Jagdeo Initiatives vision, scope, focus and process.
The Initiative is the main vehicle for the implementation of the CARICOM CAP, with a focus on addressing 9 Key Binding Constraints to the development of agriculture.
NINE KEY BINDING CONSTRAINTS OF JAGDEO INITIATIVE1LIMITED FINANCE AND INADEQUATE NEW INVESTMENTSBARBADOS/CDB2OUTDATED,INEFFICIENT AGRICULTURE HEALTH AND FOOD SAFETY SYSTEMSTRINIDAD AND TOBAGO/CARICOM3INADEQUATE RESEARCH AND DEVELOPMENTST. LUCIA/CARDI4FRAGMENTED AND DISORGANIZED PRIVATE SECTORST. VINCENT AND THE GRENADINES/CABA5INEFFICIENT LAND AND WATER DISTRIBUTION AND MANAGEMENT SYSTEMSGUYANA/FAO6DEFICIENT AND UNCOORDINATED RISK MANAGEMENT MEASURES, INCLUDING PRAEDIAL LARCENYANTIGUA AND BARBUDA/FAO7INADEQUTE TRANSPORTST. KITTS AND NEVIS/CARICOM8
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WEAK MARKETS AND MARKET DEVELOPMENT AND LINKAGES
LACK OF SHILLED HUMAN RESOURCESJAMAICA/CABA
DOMINICA/UWI
ESTABLISHMENT OF TMACsESTABLISHMENT OF A TECHNICAL MANAGEMENT ADVISORY COMMITTEE (TMAC) FOR EACH KEY BINDING CONSTRAINT (KBC) CHAIRED BY THE MINISTER OR NOMINEE.
LEAD AGENCY RESPONSIBILITY FOR ENSURING THE TECHNICAL AND REGIONAL PERSPECTIVES AND SYNERGIESCOORDINATING THE DEVELOPMENT AND IMPLEMENTATION OF ANNUAL WORK PROGRAMME
CDEMA GOVERNANCE STRUCTURE Harmonization Council (CHC)
Sector committees (5) Agriculture Sub-sector Committee (ASSC)ASSC/TMAC COMMITTEE Amalgamation of the:
TMAC of the Jagdeo Initiative and
CDEMA ASSC CommitteeTHE COMMITTEEMinister of Agriculture, Lands, Housing and Environment of Antigua & Barbuda - ChairUnited Nations Food & Agriculture Organization (FAO) Lead AgencyInter- American Institute for Cooperation on Agriculture (IICA) Technical Support AgencyCaribbean Disaster Emergency Management Agency (CDEMA)United Nations Economic Commission for Latin America and the Caribbean (UNECLAC) Caribbean Agriculture Research and Development Institute (CARDI) Technical Support AgencyCARICOM SecretariatCaribbean Community Climate Change Centre (CCCCC)Caribbean Institute of Meteorology and Hydrology (CIMH)University of the West Indies Centre for Resource Management and Environmental Studies (CERMES)Caribbean Regional Fisheries Mechanism (CRFM)Caribbean Farmers Network (CaFAN)Some form of representation from the Insurance SectorCaribbean Food and Nutrition Institute (CFNI)Organization of Eastern Caribbean States (OECS)
WORK PROGRAMME OF THE ASSC/TMAC Three- year Work Programme (2010-2012)
D-Group
Agricultural Insurance Symposium June 2010
Agricultural Risk Management Framework Developed
Agricultural Insurance Plan of Action Developed.
Praedial Larceny Agenda Evolving
COMPREHENSIVE AGRICULTURAL RISK MANAGEMENT (CARM) STRATEGY FOR THE CARIBBEANGOAL Present a systematic and logical roadmap for the implementation of actions aimed at addressing agricultural risks at the regional, national and community level through effective and efficient programmes of mitigation, , management, and coordinated response to natural, technological and man-made hazards, and the effects of climate change on the sector.
OBJECTIVESTo enhance the institutional framework and establish an effective mechanism and programme for agricultural risk management (ARM).To enhance the preparedness, response and mitigation capacity and mechanism for risk management in the agriculture sector in Member States as well as at the Regional levelTo provide emergency assistance in the management of invasive species.To support the development and promotion of national agendas for addressing praedial larceny in the region, including the legislative framework and related information and infrastructure.
ELEMENTS OF THE STRATEGY Agri-business segmentation
Risk assessment
Institutional capacity building
Risk financing.
AGRI-BUSINESS SEGMENTATIONSocial vs. Commercial insurance
Traditional farming sector
Commercial farming sector
Emerging farming sector.
WHY SEGMENTATIONTO DETERMINE ISSUES SUCH AS:
Capacity to implement best practices
Degree of risk awareness
Affordability
Risk management culture.AGRICULTURAL RISK ASSESSMENT Risk identification
Risk quantification
Risk prioritization
Probabilistic agricultural risk modelRISK, VULNERABILITY AND CAPACITY ASSESSMENTSHazard analysis Exposure analysis to value assets at riskVulnerability analysisDamage and Loss analysesThree complimentary activities:Management and dissemination of knowledge on risk.Effective early warning systems, including for famine, drought, hurricanes and floods.Communication and awareness promotion about hazard threats
INSTITUTIONAL CAPACITY BUILDINGCOMPONENTS OF CAPACITY BUILDING Data management
Regulatory/supervisory framework
Information and Education
Technical expertise
Programme administration and management.
DATA MANAGEMENTMeteorological data archiving
Weather and climate forecasting and monitoring systems
Packaging and transfer of data to end users for decision making.
REGULATORY/SUPERVISORYEstablishing a stable legal framework for disaster risk managementStrengthen national and regional disaster management agencies and establishment of stronger co-ordination mechanisms between relevant line ministriesLinking community-level experience with national-level policy makingStrengthen building codes and land-use
INFORMATION AND EDUCATIONEstablishing/strengthening of the information infrastructure for decision making, knowledge sharing and management of agricultural risk in the region
Standardization of existing educational and training materials for agricultural risk management
Establishing strategy and curriculum for building a culture of safety in the region
Developing agricultural risk management tool kit for farmers in the region
Developing and implementing communication/public awareness programmes
TECHNICAL EXPERTISEPromoting technical and physical risk mitigation
Developing agricultural risk management protocols and resource facility
Improving national and local capacities for disaster prevention and mitigation, preparedness and response
Enhancing national and regional capacities for the conduct of disaster damage assessment and the design of rehabilitation/reconstruction plans
Providing emergency assistance in the management of invasive species
Supporting the development and promotion of national agendas for addressing praedial larceny
RISK FINANCING STRATEGY OBJECTIVES
Identify the players and their potential contribution (value added) to risk financing
Determine the risk bearing capacity of the various players
Identify the financial instruments that are most suitable to transfer the risks.
RISK INSTRUMENTSAgricultural insurance and reinsuranceCatastrophic bonds (Cat bonds)Weather derivativesFuture marketsMutual fundsPersonal savingsNatural disaster funds and other public instruments, such as safety nets for the most vulnerable (micro-credit and cash transfers)Public activities in agricultural mitigation and adaptation.
AGRICULTURAL INSURANCE REGIMEAGRICULTURAL INSURANCE SCHEMES UNDERDEVELOPEDAsymmetric information
High administrative costs
Mismatch between farmers preferences and capacity to pay
Distorted Government incentives and lack of political will
Reluctance of reinsurers to enter the marketRENEWED INTEREST IN INSURANCEIncreasing frequency and cost of natural disasters
Strong links between shocks and poverty
Need to increase agricultural competitiveness in light of ongoing trade integration efforts and globalization
Promising advances in sensing technologies, computing power, telecommunications, and probabilistic risk modelling.
DESIRABLE CHARACTERISTICS:Cost effective (accessible to the producers)
Easy to administer and operate
Not subject to moral hazard: takes into account incentives and strategic responses from producers
Cover a wide range of risks
Benefit payments are fast, effective and transparent
Financially sustainable (access to international financial markets).
AGRICULTURAL INSURANCE PROGRAMME SUSTAINABILITYCOUNTRYPERIOD ANALYZEDCOST vs. PREMIUM RATIO (A+I/P)BRAZIL1975/19814.57COSTA RICA1970/19892.80JAPAN1985/19894.56MEXICO1980/19893.65PHILIPPINES1981/19895.57USA19993.68SPAIN1990/20090.83PLAN OF ACTION FOR INSURANCEAssessing the general demand for agricultural insurance by identifying objectives social vs. commercial and target audience.
Identifying those agricultural crops and producer composition, infrastructure and perils for which cost effective insurance is attainable
Conducting risk assessments, vulnerability assessments and risk prioritizationPLAN OF ACTION FOR INSURANCEAssessing the available products and supply of insurance/reinsurance to support initiatives
Assessing the feasibility of up scaling existing initiatives such as WINCROP to cover multi-perils and crops
Assessing the role of Government in the provision of administrative oversight, information systems, legal and regulatory framework, etc.
PLAN OF ACTION FOR INSURANCEDetermining effective channels of distribution
Designing and implementing a regional catastrophic risk facility for the sector (CCRIF or not)
Developing pilot schemes
Developing information and education programmesPRAEDIAL LARCENY AGENDAPRAEDIAL LARCENY CONSULTANCYTHE BEASTWhat we no longer see are desperate individuals trying to satisfy themselves with a single act.
What we are now seeing are expert farmers and butchers who drive in vehicles and are well equipped to facilitate their nefarious activities.
Those engaging in Praedial Larceny are now highly sophisticated and that their actions are causing despair for the victims.
Those victims of Praedial Larceny are men and women who have invested their savings, who have mortgaged their properties REGIONAL COST OF PRAEDIAL LARCENY Loss of crops and livestockIn Jamaica - the annual loss to Praedial Larceny is estimated at J $ 5.0 billion (US $ 60 million).Caribbean annual loss is estimated at US $385 million
Reduced levels of farmers profitability
Loss of investments disincentive for investments
Threat to human health and safety
Loss of good genetic material
ROLE OF PUBLIC PRIVATE SECTOR Agriculture must take a holistic approach to address Praedial Larceny
Must involve all stakeholders government, judiciary and producers along the entire value chain STRATEGY MUST INVOLVE: Public Awareness and Public Education
Re education of the police and Judiciary
Strengthening of Existing Laws and Legislation
The establishment of traceability system
Appointment of Chief Praedial Larceny Officer
RE-EDUCATION OF POLICE AND JUDICIARYResident magistrates and police must not treat thieves too leniently
Praedial Larceny must be seen as a crime. The real issue is crime
Assets earned through Praedial Larceny must be included in the Proceeds of Crime Act and treated the same way that assets from drugs and other organized crimes are treated.
Convicted praedial thieves must be bound to compensate their victims
Promotion of call in services
STRENGTHENING OF EXISTING LAWS AND LEGISLATION Stiffer penalties to include:Increasing fines and sentences.
Instituting a three strike system
Reviewing laws and penalties for individuals who accept stolen goods
Implementing a mechanism for compensating farmers from fines collected.ESTABLISHMENT OF TRACEABILITY SYSTEM Record keeping by farmers
Registration of producers and vendors.
Introduction of receipt books within the context of a Sale of Produce Act
Re-introduction or introduction of slaughter Register
Certification of Abattoirs
Mapping of Hot Spots
APPOINTMENT OF CHIEF PRAEDIAL LARCENY OFFICER Establishes a Focal Point
Gives impetus to the implementation of an aggressive programmeTHANK YOU