News ID: 233731
Published: 0910 GMT November 03, 2018

Central American farmers face climate change without insurance

Central American farmers face climate change without insurance

Disconsolate, Alberto Flores piles up on the edge of a road the few bunches of plantains that he managed to save from a crop spoiled by heavy rains that completely flooded his farm in central El Salvador.

“Everything was lost, I have been cutting what can be salvaged, standing in water up to my knees,” said Flores, a 54-year-old peasant farmer from San Marcos Jiboa, a village in the municipality of San Luis Talpa, in the south-central department of La Paz, reported.

Flores told IPS that as a result of the rains, which hit El Salvador and the rest of Central America in mid-October, he lost some $2,000, after nearly a hectare of his plantain (cooking bananas) crop was flooded.

San Marcos Jiboa is a rural community of 250 families, 90 percent of whom are dedicated to agriculture. Most of the local farming families were affected by the torrential rains, IPS found during a tour of the area.

The damage was mainly to chili peppers, maize, beans, bananas, pipián — similar to zucchini — and loroco (Fernaldia pandurata), a creeper whose flower is edible and widely used in the local diet.

Other parts of the country and the Central American region were also hit hard.

Central America has been described in reports by international organizations as one of the planet’s most vulnerable regions to the onslaught of climate change.

And yet, tools that help farmers mitigate weather shocks, such as agricultural insurance, are not widely available in Central America, although important initiatives have been launched.

“I’ve heard about agricultural insurance, but no one comes to explain what it’s about,” said Flores, who perspires heavily as he piles up clusters of green plantains.

Compared to Mexico or countries in South America, Central America has made little progress in this area, according to the report Agricultural Insurance in the Americas, published in 2015 by the Inter-American Institute for Cooperation on Agriculture (IICA).

The report states that the efforts made in the region have not generated the expected results, although it cites a growth in agricultural insurance premiums in Guatemala, where they totalled 2.25 million dollars, followed by Panama (1.8 million) and Costa Rica (just over 500,000 dollars), according to data from 2013.

Experts pointed out that the high cost of agricultural insurance premiums, which is about 13 percent of an agricultural loan or investment, is one of the reasons, as well as a lack of information on and culture of using insurance.

 “Basically, it’s expensive,” Saúl Ortiz, Guate Invierte’s Risk Analysis and Management Coordinator, told IPS by telephone from Guatemala. The financial institution manages a trust fund of more than 70 million dollars in agricultural support in various areas, including insurance.

It is precisely because of these costs that Guate Invierte emerged in 2005, added Ortiz, to support the country’s small and medium producers and give them the chance to take out a policy. The initial plan was to extend it throughout the region.

In addition to being a state guarantor of agricultural credits acquired by farmers from other financial institutions, Guate Invierte offered insurance not linked to loans, with a subsidy of up to 70 percent of the cost of the premium.

But that scheme failed because the government stopped injecting funds, and in 2015 Guate Invierte ceased to offer subsidized insurance not linked to loans, although it maintains coverage for customers who do have loans.


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