Developing Rainfall-based Index Insurance in Morocco


Book Description

Almost 90 percent of Moroccan agriculture is not irrigated, and since most of Morocco's crops depend on adequate rainfall, yields and production vary widely. A drought insurance program based on rainfall index contracts is feasible in parts of Morocco and could significantly benefit its farmers.




Developing Rainfall-Based Index Insurance in Morocco


Book Description

Almost 90 percent of Moroccan agriculture is not irrigated, and since most of Morocco's crops depend on adequate rainfall, yields and production vary widely. A drought insurance program based on rainfall index contracts is feasible in parts of Morocco and could significantly benefit its farmers.Cereal production accounts for about 70 percent of all agricultural land in Morocco. Cereal producer prices, influenced by the government, are higher than world prices. Production is divided into six broad agroclimatic zones. About half of cereal production is concentrated in the favorable and intermediate zones; the rest occurs mostly in less favorable (arid and semi-arid) zones, with average annual rainfall below 450 millimeters.Skees and colleagues assess the feasibility of rainfall-based index insurance to provide effective, low-cost drought insurance for Moroccan farmers and rural dwellers. Their analysis focuses on Morocco's three main cereal crops - hard wheat, soft wheat, and barley - using data on annual production and planting from 1978-99. Maize is included in some of the analysis.The benefits of this program over the traditional insurance scheme are that it minimizes the risk of moral hazard and adverse selection and promotes a streamlined pay-out process. These features make the program more attractive to international re-insurers and investors in capital markets.A rainfall-indexed insurance product is feasible in Morocco, where the statistical correlation between rainfall and cereal revenues is rather strong in 17 provinces in the more favorable agroclimatic zones. Proportional rainfall insurance contracts would pay the insured an amount based on the shortfall in actual rainfall during a set period compared with the trigger rainfall. The contracts could be purchased in any amount, allowing farmers to insure the full amount of their expected revenue if they wish.This paper - a joint product of Private Sector Development and Finance Group, Middle East and North Africa Region; Rural Development, Development Research Group; and Financial Sector Department - is part of a larger effort in the Bank to analyze the feasibility of weather-based index insurance markets in developing countries. The authors may be contacted at [email protected], [email protected], [email protected], or [email protected].
















Lineages of Revolt


Book Description

While the outcomes of the tumultuous uprisings that continue to transfix the Arab world remain uncertain, the root causes of rebellion persist. Drawing upon extensive empirical research, Lineages of Revolt tracks the major shifts in the region’s political economy over recent decades. In this illuminating and original work, Adam Hanieh explores the contours of neoliberal policies, dynamics of class and state formation, imperialism and the nature of regional accumulation, the significance of Palestine and the Gulf Arab states, and the ramifications of the global economic crisis. By mapping the complex and contested nature of capitalism in the Middle East, the book demonstrates that a full understanding of the uprisings needs to go beyond a simple focus on “dictators and democracy.”




Environmental Change and Human Security in Africa and the Middle East


Book Description

This volume brings together insights on the interactions between environmental change and human security in the Middle East and Africa. These regions face particular challenges in relation to environmental degradation, the decline of natural resources and consequent risks to current and future human security. The chapters provide topical analysis from a range of disciplines on the theory, discourse, policy and practice of responding to global environmental change and threats to human security. Case studies from Morocco, Tunisia, Egypt, Turkey, Iraq and Syria provide empirical evidence, with a focus section dedicated to the critical issue of water resources and water security in the region. The contributions demonstrate above all that the risks posed to human security arise through multiple and interconnected processes operating across diverse spatial and temporal scales. The complexity of these processes requires new ways of thinking and intervening. As a contribution, the current volume provides engaging insights from theory and practice for those seeking to address the challenges of environmental change.




Examining the Feasibility of Livestock Insurance in Mongolia


Book Description

Herders in Mongolia have suffered tremendous losses in recent dzud (winter disasters), with livestock mortality rates of over 50 percent in some locales. This study examines the feasibility of offering insurance to compensate for animal deaths. Such an undertaking is challenging in any country. Mongolia offers even more challenges given the vast territory in which herders tend over 30 million animals. Traditional approaches that insure individual animals are simply not workable. The opportunities for fraud and abuse are significant. Monitoring costs required to mitigate this behavior would be very high. This study focuses on the potential for using the livestock mortality rate at a local level (for example, the sum or rural district) as the basis for indemnifying herders. Applications of index insurance are growing around the world, although no country has so far implemented such insurance for livestock deaths. But few countries have such frequent and high rates of localized animal deaths as does Mongolia, and it is one of the few countries that perform an animal census every year. This concept may therefore be precisely what is needed to start a social livestock insurance program. Just as important, the insurance that is used in Mongolia should not interfere with the exceptional efforts that experienced herders take to save animals during severe weather. Using an individual insurance may, in fact, diminish these efforts. Herders may ask, "Why should I work so hard to save my animals if I will simply be compensated for those that are lost?" Since the index insurance would pay all herders in the same region the same rate, the incentives for management to mitigate livestock losses remain strong. No one would reduce their effort to collect on insurance. Those who increase their efforts during a major event (dzud) would likely be compensated for this effort even though they do not lose livestock. In some cases, they could reasonably expect to receive payments that would compensate for the added effort or the added cost of trying to save their livestock.




The New Public Finance


Book Description

The world's agenda of international cooperation has changed. The conventional concerns of foreign affairs, international trade, and development assistance, are increasingly sharing the political center stage with a new set of issues. These include trans-border concerns such as global financial stability and market efficiency, risk of global climate change, bio-diversity conservation, control of resurgent and new communicable diseases, food safety, cyber crime and e-commerce, control of drug trafficking, and international terrorism and weapons of mass destruction. Globalization and increasing porosity of national borders have been key driving forces that have led to growing interdependence and interlocking of the public domains--and therefore, public policy concerns--of countries, governments, private businesses, civil society, and people at large. Thus, new and different issues are now occupying top places on national policy agendas, and consequently, on the agendas of international negotiating forums. The policy approaches to global challenges are also changing. A proliferation and diversification of international cooperation efforts include focus on financing arrangements. Financing of international cooperation in most instances is a haphazard and non-transparent process and often seems to run parallel to international negotiations. There are many unfunded mandates and many-non-mandatory funds. To agree on and to achieve international economic goals, we need to understand how financing of international cooperation efforts actually works. Our understanding is hampered by two gaps: 1) lack of an integrated and cohesive theoretical framework; 2) lack of consolidated empirical and operational knowledge in the form of a comprehensive inventory of past, current and possible future (i.e. currently deliberated) financing mechanisms. This book reduces these two gaps and provides a guide to improve our ability to finance international cooperation.