Date post: | 21-Jul-2018 |
Category: |
Documents |
Upload: | nguyenhuong |
View: | 218 times |
Download: | 0 times |
Climate Change impact and role of agricultural insurance in Central Asia
Dr. Ihtiyor Bobojonov
Ashgabat Workshop
23-24 November 2017
www.iamo.de 2
Content
• Farm impact in Central Asia
• Role of spatial locations in the irrigation systems
• Adaption option: Crop diversification
• Adaptation option: Insurance project
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 3
• Importance of agricultural production
• Environmental and institutional challenges
• Changing temperature and rainfall patterns
• Uncertainty of crop yields
• Price fluctuations
• Limited research on adaptation options
• Need for further research on climate change impact
Problem Statement Im
pac
t in
CA
Sp
atia
l im
pac
t C
rop
d
iver
sifi
cati
on
In
sura
nce
pro
ject
www.iamo.de 4
• Expected Value Variance in GAMS
• Yield and management data from crop models
• AEZ data from GIS
Empirical Model Im
pac
t in
CA
Sp
atia
l im
pac
t C
rop
d
iver
sifi
cati
on
In
sura
nce
pro
ject
www.iamo.de 5
Location of Crop Experiment Stations in Different AEZs
Counry AEZ
Kazakhstan
1 arid
2 semiarid
3 subhumid
Kyrgyzstan
4 subhumid
5 semiarid
Tajikistan
6 arid
7 semiarid
8 humid
Uzbekistan
9 arid
10 semiarid
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 6
Input Price Differences Between the Countries
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
Kaz
akh
stan
Kyr
gyzs
tan
Tajik
ista
n
Uzb
eki
stan
Kaz
akh
stan
Tajik
ista
n
Uzb
eki
stan
Kaz
akh
stan
Tajik
ista
n
Uzb
eki
stan
Kyr
gyzs
tan
Tajik
ista
n
Uzb
eki
stan
Kaz
akh
stan
Kyr
gyzs
tan
Tajik
ista
n
Uzb
eki
stan
fuel ammafos nirate wheat seed potatoes seed
USD
kg-
1
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 7
Change of Expected Farm Income Im
pac
t in
CA
Sp
atia
l im
pac
t C
rop
d
iver
sifi
cati
on
In
sura
nce
pro
ject
www.iamo.de 8
Location Dependent Impact Im
pac
t in
CA
Sp
atia
l im
pac
t C
rop
d
iver
sifi
cati
on
In
sura
nce
pro
ject
www.iamo.de 9
Income Change under B2 and A2 Scenarios in 2050
Spatial change under A2 Spatial change under in B2 Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 10
Crop Diversity in Central Asia Im
pac
t in
CA
Sp
atia
l im
pac
t C
rop
d
iver
sifi
cati
on
In
sura
nce
pro
ject
www.iamo.de 11
The Role of Alternative Crops under Drought Risk
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 12
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
KlimALEZ: Increasing climate resilience via agricultural insurance
Insurance project
Prof. Thomas Glauben, Dr. Ihtiyor Bobojonov, Dr. Lena Kuhn
www.iamo.de 13
The role of agricultural insurance
• Provides payments when losses occur
• Enable access to credits
• Increase investment confidence
• Improve productivity
• Increase risk coping potential
• Improves food security for rural and urban population
©weADAPT
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 14
Agricultural insurance market development in the CIS
• Mandatory insurance by “Gosstrakh” during the Former Soviet Union (FSU)
• Collapse of the state insurance mechanisms after independence
• Emergence of semi-state insurance companies in several countries: Kazakhstan, Russia, Ukraine and Uzbekistan
• Lack of agricultural insurance markets in the remaining states
• High interest of international organizations and governments to establish insurance markets in some regions (e.g. Azerbaijan, Armenia and Tajikistan).
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 15
Agricultural insurance in Kazakhstan
• Mandatory insurance for grain crops
• Loss subsidy of 50% from the state
• Very low rate of premiums and low indemnity payment
• Lack of interests of producers
• Current debate: Increasing the price and introducing index insurance
0
1000
2000
3000
4000
5000
0%
20%
40%
60%
80%
100%
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
Insurance covered area, % Insurance premium per ha
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 16
Agricultural insurance in Uzbekistan
• 25% subsidy until 2002
• Abolishment of the subsidy since 2003
• Multiple peril crop insurance
• Lack of products to cover systemic droughts
• Discussions on re-introduction of subsidies
• High interests of national companies to introduce index insurance to access international reinsurance
1
6
11
16
21
26
31
36
0
20
40
60
80
100
120
140
160
180
200
2008 2009 2010 2011 2012
Insu
ran
ce c
ove
rage
rat
io (
%)
10
00
far
me
rs
insured uninsured Insurance coverage ratio
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 17
KlimALEZ project objective
Introduction of an agricultural index-based insurance program in Central Asia
Agricultural insurance
Improved credit accesss
Agr. Investment
Decreased production risk
Climate resilience Rural welfare Food security
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 18
0
50
100
150
Loss
es
in U
SD/h
a
NDVI vs. agricultural losses (R2=0.61)
Losses NDVI
• Traditional insurance premiums: 38 USD/ha (16% of revenue)
• Rainfall insurance premiums: 23 USD/ha (9.5 % of revenue)
• NDVI insurance premiums: 29 USD/ha (12,3 % of yield)
Illustrative example for NDVI based index estimations
Suitability of index insurance (example Shortandy)
3) Weather index based on normalized difference vegetation index (NDVI)
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 19
Methods
STEP 1: Scientific development of a region-specific weather index • Analyis of existing insurance pilots • Secondary weather and satellite data • Farm surveys • Expert interviews • Insurance game for demand analysis and price setting STEP 2: Insurance pilot involving local and German insurance companies • Two waves in sample regions in Kazhakstan, Kyrgystan and Uzbekistan • Test consumer demand and product implementation • Adapt product in second wave if necessary
STEP 3: Impact assessment via randomized controlled trial (RCT) • Treatment sample: 400 farms in Kyrgyzstan and Uzbekistan • Test impact on investment and production and spillover effects
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct
www.iamo.de 20
Project team and partners
IAMO team
Prof. Dr. Thomas Glauben
Dr. Ihtiyor Bobojonov
Dr. Lena Kuhn
Research partners
Humboldt-Universität zu Berlin (Germany)
Dr. Roman Mogilevskiy, University of Central Asia (Kyrgyzstan)
Kazagrotechnical University (Kazakhstan)
Talap Analytical Center (Kazakhstan)
Banking and Finance Academy (Uzbekistan)
Insurance and reinsurance companies
SFK Insurance (Kazakhstan)
Jubilee Insurance (Kyrgyzstan)
Gross Insurance (Uzbekistan)
Hannover Re (Germany)
Imp
act
in C
A
Spat
ial i
mp
act
Cro
p
div
ersi
fica
tio
n
Insu
ran
ce p
roje
ct