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How We’ve Supported Infrastructure Growth In Rivers State – SHELL

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“Between 2006 and end of 2017, a total of N14.86 billion has been invested by the SPDC Joint Venture in the GMoU clusters in Rivers State, giving communities a highly-valued opportunity to decide and implement projects and programmes that have a lasting impact on people’s lives,” said the General Manager, External Relations of SPDC, Igo Weli, on Saturday in Port Harcourt at the 2018 edition of the Nigerian Society of Engineers Port Harcourt Branch Week.

Weli, who spoke on the role of oil and gas sector in the infrastructure development of Rivers State, said the SPDC JV funding enabled 19 GMoU clusters in Rivers State to embark on projects covering health, education, water and power supply improvement, sanitation and infrastructure development. He added that the success of the GMoU initiative proved what could be achieved when government, international oil companies, communities and NGOs worked together for the common good.

Under the terms of the GMoU, SPDC JV provides secure five-year funding for communities to implement development projects of their choice, which are managed by Cluster Development Boards under the guidance of mentoring NGOs.

On social infrastructure, Weli listed the N1.5billion ultramodern library donated by Shell to the state government to commemorate Nigeria’s centenary celebration, and the establishment of a Community Health Insurance Scheme at Obio Cottage Hospital in Port Harcourt where the average number of patients increased from about 600 to about 7,500 per month in 2017, making it one of the most utilised health facilities in the area. He said 10 other hospitals in Rivers State also enjoyed ‘robust health intervention scheme by SPDC JV’.

In education, he cited the establishment of the first centre of excellence in Marine Engineering and Offshore Technology at Rivers State University in Port Harcourt in 2017, which has commenced programmes leading to the award of Master’s degrees in Marine Engineering (Power Plants), Naval Architecture and Offshore and Subsea Engineering. This, he said was in addition to the many SPDC JV scholarship schemes which date back to the 1950s.

On the statutory role of the oil and gas sector in infrastructure development in Niger Delta, Weli noted that each player in the sector was expected to contribute 3% of its annual budget to the Niger Delta Development Commission (NDDC) for the purpose of facilitating the rapid, even and sustainable development of the Niger Delta region into an area that is economically prosperous, socially stable, ecologically regenerative and politically peaceful. “Between inception of NDDC in 2002 and the end of 2017, Shell companies alone contributed N338.12billion to the commission,” he said.

He noted that the responsibility for the development of communities, societies or states resides primarily with government and community stakeholders themselves. “It stands to reason therefore that abdicating that responsibility for development to the private sector either fully or substantially is, in my assessment, one of the key issues militating against sustainable development not just of Rivers State but of the Niger Delta.”

He frowned on the expectationthat private sector should take on the role of government even after fulfilling their statutory obligations to the state and investing as much as their businesses can carry in social investments in the host communities. “This is not sustainable and perhaps accounts for the steady drop or reduction in investments, hence the dwindling opportunities in employment, contracts, and so on, in the Niger Delta in the past two decades.”

Weli added: “The region is no longer very attractive to investors because of the unrealistic demand and entitlement mindset. The future of the Niger Delta is in the hands of private investors, therefore stakeholders need to re-set their expectations and approach to achieve sustainable growth and development. Investors are to be wooed and investments, attracted, not taken for granted.”

He therefore appealed for a conducive operating environment to enable the private sector do business profitably without fear so that they could implement social investment projects and programmes.

He said: “For the private sector, including the oil and gas industry to support the state for infrastructure development, the state, as a matter of policy, and the people, as a matter of dogged commitment, must resolve to make the state peaceful, friendly, attractive and competitive.”

 

Bamidele Odugbesan
Media Relations Manager(SHELL)

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NGOs - SDGs

Innovative partnerships needed to tackle climate related disasters

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Drought Image (Supplied)

The devastating crisis in Madagascar sounds a stark warning of the need to take urgent action for Africa according to Ibrahima Cheikh Diong, Director General of the African Risk Capacity Group.

“Drought may well be the next pandemic after COVID-19 and there’s no vaccine to cure it.” If the words of Mami Mizutori, the UN Secretary General’s Special Representative for Disaster Risk Reduction don’t compel us to take immediate action, Africa will continue to bear the scars of barren wastelands caused by climate change-induced drought. Southern Africa, East Africa, the Horn of Africa and now Madagascar are just the start. The short-term solution to building resilience requires a multi-faceted approach involving both private and public sectors, says Diong.

“Our affiliate, ARC Ltd, which recently received a BBB+ Insurer Financial Strength rating from Fitch, works with governments, NGOs and funders to provide customised parametric insurance. This  empowers African governments and NGOs to respond swiftly to natural disasters on the continent, but there’s a lot of work that needs to go into building distribution networks to ensure that we can reach as many people as possible. We need to build a coalition of the private and public sector,” Diong adds.

While governments are key in dealing with resilience to climate change, it’s the ability of the private sector to take action that will make all the difference, he says.

“Partnerships should extend beyond governments. The private sector is an essential partner for leveraging funding and experience demonstrates that private-sector entities are capable of rapidly taking up opportunities when and if these make sense from a business angle.”

There are several examples where a collaborative approach is already working well. Diong cites ARC Group’s partnerships with organisations such as the Start Network and World Food Programme (WFP), and funders such as the German Development Bank, UK Foreign, Commonwealth & Development Office and African Development Bank which are working to provide that resilience for African countries.

Shifting the disaster risk architecture

Emily Jones, as Climate and Disaster Risk Financing Advisor for WFP, highlights the challenges of convincing authorities to be more proactive than reactive when preventing human suffering and hardship when events like drought occur.

“Unfortunately, no one person or organisation can make the necessary shift alone. Change starts with building resilience and insurance plays a significant role in that, particularly in climate change,” says Jones.

Governments pay a premium every year and receive their agreed-upon pay-out if and when a predicted disaster occurs. “This money can then be used to help those people affected, with the remainder of the pay-out going towards covering other consequences that might not have been expected, such as conflict or a loss of progress in terms of important local development projects,” she says.

“Humanitarians are working on highlighting the need to predict crises and act before they manifest in an effort to avoid human suffering. After all, why wait if you don’t have to?”

Jones speaks about how most authorities in African countries perceive insurance as a gamble when it should rather be seen as a risk management tool. Unfortunately, many simply don’t have the necessary tools available to plan, which is where ARC comes in.

“It’s amazing that ARC Limited is offering this type of insurance. However, insurance is really only cost-effective for catastrophic events that happen infrequently – perhaps once every 10 years – and if the governments that they’re selling the insurance to don’t have other solutions, they’re going to be taking out insurance that’s less than optimal,” Jones explains.

“So, something that WFP, ARC, and the African Development Bank wants to work on in the coming years is a risk-layering approach. This would involve introducing other tools for coping with those medium-scale events so that we can optimise ARC and hopefully offer better products, as well as ensure improved buy-in, a greater understanding of the products’ importance, and a track record of success,” she adds.

Responding swiftly to natural disasters

Since ARC Limited was established in 2014, the company has paid out $65-million in drought-relief efforts to seven different countries.

“In particular, the collaboration between the African Development Bank and ARC shows how coming together makes a major difference. In 2020, the ARC drought-relief pay-outs to Zimbabwe, Madagascar and Côte d’Ivoire totalled $6-million,” says Diong.

Madagascar received a payment of over $2,1-million, which was allocated to food assistance for 15,000 households, nutritional support to 2,000 children and 1,000 pregnant and breastfeeding women, and water supplies to over 84,000 households.

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Reaching the most vulnerable, however, is difficult, adds Malvern Chirume, Chief Underwriting Officer ARC Limited.  “One of the big challenges is access to the final customer, bearing in mind that most of our beneficiaries of the programmes are small- to medium-scale farmers and therefore it’s not cost-effective to access them one at a time.” 

With climate change, we can expect extreme weather events to hit harder and more frequently in coming years. In a 1.5 degree warmer world, there is no doubt that drought will be a more regular event.

The GAR Special Report on Drought 2021 launched earlier this year is a call to action: we must act now if we are to meet the goals of the Sendai Framework for Disaster Risk Reduction, the 2030 Agenda for Sustainable Development, and create a safer, more resilient, risk-proofed future for all.

“Drought is not something that hits us suddenly, nor something that we can quarantine our way out of. Drought manifests over months, years, sometimes decades, and the results are felt just as long. Drought exhibits and exacerbates the social and economic inequalities that are deep-rooted within our systems and hits the most vulnerable the hardest,” says Chirume.

“While we may not be able to prevent it, we can certainly be prepared to deal with its impact by building resilience and providing swift support to those who are left vulnerable.”

Issued by ARC Limited

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Corporate Citizenship

Fawry, AWEF, Unilever and LEAD Foundation celebrate the continued success of the “Heya Fawry” initiative

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In line with its mission to empower Egyptian women, the leading digital transformation and e-payment network Fawry has just announced the expansion of the Heya Fawry initiative to increase poor and disadvantaged women’s access to life-enhancing digital financial services and greater economic opportunities.

Now on its third consecutive year, Heya Fawry’s expansion was made possible thanks to cross-sector collaboration between Fawry, Unilever, Lead Foundation and funding support from the British Foreign, Commonwealth & Development Office (FCDO) via the Arab Women’s Entreprise Fund Program (AWEF). The initiative aims to help women gain access to greater job opportunities by becoming Heya Fawry agents, while providing life-enhancing financial services to predominantly unbanked female customers. Ultimately, Heya Fawry creates new revenue streams for low-income women who can now further contribute to their household’s income well-being while participating to the Egyptian economy.

“We are pleased with the great continued success that Heya Fawry has achieved, as well as its contribution to improve the conditions of low-income and disadvantaged women in Egypt.” We also stand with the Egyptian government to accelerate digital transformation and promote financial inclusion said Ahmed Fahmy, Head of Partnerships at Fawry.

“While AWEF may have served as a catalyst to promote women’s economic empowerment and inclusion, it was only due to the commitment, vision and dedication of its partners that the “Heya Fawry” initiative has reached this level of success,” said Yomna Mustafa, Country Director at AWEF.

Islam Abdel-Raouf, Alexandria regional sales and Emerging Channels Sector Manager at Unilever, said that “Unilever is proud to participate in this distinguished initiative for the third year in a row. Unilever provides products to Heya Fawry agents, but we also work on developing their marketing & management capabilities, to ensure sustainable incomes.

As part of the second phase of the initiative, Heya Fawry was joined by Lead Foundation, a preeminent Egyptian Microfinance Institution, which designed a dedicated Heya Fawry Microfinance Program and avails microloans to selected beneficiaries, via digital means “Believing in our mission to provide poor & low-income entrepreneurs, with sustainable access to quality microfinance services that address their needs, Lead Foundation saw in Heya Fawry a great opportunity that will suit the needs of ambitious female micro entrepreneurs who work from home or manage a shop.” added Sandy Salama, Marketing and Communications Manager at Lead Foundation.

The first phase of the initiative built upon synergies between four “Core Partners”, Fawry, AWEF, AXA Insurance who offered medical and life insurance services free of charge for 3 years, as well as Unilever, who trained Heya Fawry agents to become successful retailers of well-known home care, beauty and food brands.

To date, the initiative successfully provided more than 300 job opportunities for female agents who allowed thousands of unbanked consumers, predominantly female, to conduct approximately 300 thousand e-payment transactions (of a total value worth EGP 10 million). The initiative offered support to Egyptian women in the poorest areas in Cairo, Giza, Assiut, Fayoum and Minya, by financing the initial capital needed to become an Fawry agent and raising their capabilities as micro-entrepreneurs. The initiative not only seeks to enhance women’s digital and financial skills but also their ability to successfully manage projects, secure profits and expand their networks.

Ultimately, this initiative is in line with Egypt’s strategy and 2030 vision to aid small investors and traders and boost the plan of digital transformation and financial inclusion. Going forward, Heya Fawry partners also announced their plan to expand the scope of work available in order to include more women under the next Heya Fawry iteration.

 

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NGOs - SDGs

Shifting Africa’s climate change disaster risk architecture before COP26 and beyond

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All eyes are on the existential crisis posed by climate change as the United Nations Framework Convention on Climate Change (UNFCCC COP26) approaches, with many warning that lessons for dealing with climate change threats must be learned from how Africa has handled the current COVID crisis.

Resilience in Africa to these climate change impacts can only be built with the assistance of developed countries and these have a vested long-term interest in providing this support, says Ange Chitate, COO African Risk Capacity Limited.

“Beyond COVID, the most critical risk to Africa is the availability of water, which is directly linked to climate change. The continent is extremely vulnerable to and bears the brunt of drought, flooding, cyclones and other climate change-led weather events, even though it has actually had very little impact on carbon emission,” says Chitate.

This is particularly serious for a continent like Africa which depends so heavily on agriculture for its economy and employment.

“When one considers that agriculture sustains two thirds of Africa’s employment and that more than 80% of agriculture in Africa is conducted by small- to medium-scale farmers who are at the mercy of climate change events completely out of their control, COP26 talks have to deliver practical and meaningful support from developed countries to help ensure a high level of preparedness in the developing world for what is being touted as the next pandemic,” Chitate adds.

It is a view shared by South Africa Forestry, Fisheries and Environment Minister Barbara Creecy, who says if COP26 is to be successful, developing countries need support from developed countries in the form of finance, technology and capacity building.

South Africa’s suggested global goal on adaptation sees focus being placed on “the most vulnerable people and communities; their health and well-being; food and water security; infrastructure and the built environment; and ecosystems and ecosystem services, particularly in Africa, Small Island states and Least Developed Countries”.

Minister Creecy also calls on developed countries to ensure access to long-term, predictable and affordable finance for developing communities.

Building Africa climate change resilience through natural disaster insurance relief

“There’s a responsibility for G7 countries to support Africa in managing the impact of climate change by, for example, providing sovereigns with parametric insurance premium finance to help them respond swiftly and decisively to crises fueled by climate change on the continent,” says Delphine Traoré, ARC Limited Non-Executive Director.

Established in 2014, ARC Limited provides natural disaster insurance relief to African countries which have joined the sovereign risk pool.

Along with its partners, which provide premium support, the insurer has already paid over US$65m to seven countries to provide drought relief and address the economic concerns these countries’ most vulnerable citizens face.

Governments then make payments to the most vulnerable households in drought-stricken or other climate-affected areas so the most vulnerable communities can supplement their food budgets if reduced harvest tends to push up food prices.

“Our role is explaining to African governments the importance of having this type of insurance and accounting for food security and disaster risk in their budgetary work process.

“There’s been a lot of work done by ARC Limited with the support of the African Development Bank and other financial institutions to see how we can support these countries with a super replica programme. We need to do more still to find a sustainable way to do premium financing for countries that are not able to afford it but that are quite impacted by climate change impacts,” says Traoré.

Most recently, ARC Limited paid out US$2.1m to the Madagascar Government to meet the food security needs of over 600,000 people affected by the devastating drought.

ARC Limited’s role as a parametric insurer is critically important in building resilience and ensuring a country is able to bounce back swiftly after a natural disaster.  “We monitor the rainfall of countries in the risk pool and sovereign insurance pay outs are triggered when the system reveals that there hasn’t been enough rain, before droughts get to a crisis stage, farmers are left with nothing and people are starving,” explains Chitate.

The programme further helps countries build capacity to manage climate-related risks. In this way it attempts to shift the disaster risk management architecture to be proactive, not reactive, says Chitate.

“We see a tangential benefit of this type of programme being the increasing sophistication of countries to better understand risk. The current COVID pandemic is a good example of this.

“When dealing with risk mitigation and management, one needs to examine the reason why governments don’t act. On the insurance side, one of the issues to address is around premium affordability because it’s quite expensive to insure against natural disasters and payment of premium competes against other national priorities,” explains Chitate.

Sovereigns which participate in the ARC programme must also develop a contingency plan which sets out at a very high level how the government would spend any insurance pay out they receive from ARC.

“Through this plan, we ensure the funds get to the intended beneficiaries. Having a plan increases dramatically the speed of execution because at a point the government received the funding, it already has a plan on how to disburse this,” she says.

With US$100 million in its kitty, ARC says it probably has the largest balance sheet dedicated to climate risks in Africa.

 

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