The African Risk Capacity Specialized Agency of the African Union (ARC) provides financial tools and infrastructure to help African Union (AU) Member States manage natural disaster risk and improve the way predictable natural disasters are responded to on the continent by reducing the time it takes for assistance to reach those affected through early, local response. ARC achieves this by bringing together three critical elements that create a powerful value proposition for its participants: early warning, contingency planning and insurance. Together this package provides governments with access to immediate funds for early and planned responses to support vulnerable populations in the event of disasters. This vehicle allows ARC to help its Members build capacity to lead their own responses and reduce their reliance on the international appeals process for assistance over time. More critically, however, reduced response times save the lives and livelihoods of those affected and protect development gains, essential for growth and building a more disaster resilient Africa for the future.
Emerging infectious diseases pose an increasing threat to health and development in Africa. Slow, unpredictable funding amplifies both the risk and impact of outbreaks. Following the Ebola crisis that ravaged West Africa, African Ministers of Finance requested the ARC Secretariat in March 2015 to develop a product to address countries’ financing needs to contain outbreaks of viruses and diseases common to the African continent, and in the event of spread or secondary transmission. In the case of Ebola, financing was only mobilized (depending on the affected country) 4-9 months after the first cases were reported. According to ARC and its partners’ analysis, beginning the Ebola response just two months earlier could have reduced total number of deaths by 80% in Liberia and Sierra Leone. In March 2014, the WHO issued an Ebola appeal for USD 4.8 million dollars to contain the virus; by September 2014 the UN issued an appeal for nearly USD 1 billion to halt the spreading outbreak.
Global outbreak and epidemic (O&E) response is shifting to promote faster and more predictable funding, and country ownership of the response. ARC will achieve both of these goals in a single mechanism using its existing infrastructure and programmatic approach to African-led outbreak risk management in order to strengthen national financial and operational response capacity. ARC insurance would fund O&E contingency plans, with levels of risk for countries and epidemics quantitatively modeled, and with payout triggers coming from accurate detection of distinct epidemiologic events in-country. ARC’s O&E insurance program will be targeted to address many of the problems inherent in O&E response by:
- Establishing a pool of cost-effective capital that can be rapidly deployed
- Ensuring countries acknowledge O&E by tying declaration of epidemiologic events reported through verifiable sources to immediate financial payouts
- Facilitating better health systems strengthening and preparedness (e.g. through better surveillance mechanisms and incentivized contingency planning)
- Promoting pan-African and sub-regional solidarity and coordination
- Linking the African Union’s and its partners’ investments in the strengthening of health systems, country preparedness and the new African Centre for Disease Control into a full ecosystem for pandemic risk management on the continent
As a Member State-based organization and Africa’s sovereign insurance pool, ARC is uniquely positioned to fill a gap in the Africa’s pandemic risk management architecture by providing targeted tools that can support and incentivize early and effective responses by governments to outbreak situations within their countries, aiming to the extent possible to contain events before they spread across borders and need broader regional and international intervention.
With the support of the Rockefeller Foundation, the research and development phase for ARC’s O&E insurance program started in 2016 with the aim of insuring a first group of pilot countries against O&E risks in 2018.