Locations
Representatives from FRA implementation countries such as Bangladesh, Ethiopia, India, Tanzania, and Uganda during a global workshop organized by the Gates Foundation’s Agricultural Development (AgDev) in Kampala, Uganda.
There is war between humanity and nature, and if urgent action is not taken, nature will continue to strike back with a fist. There is glaring evidence of the effects of climate change including rising temperatures, prolonged droughts, floods which affect crop production and lead to crop failure, low yields, loss of income to farmers, food insecurity, hunger and starvation. Small-scale farmers in low developing countries like Uganda who have less resilience and capacity are the worst hit by these disasters. Which further escalates poverty and undermines the achievement of Sustainable Development Goals (SDGs).
It is also estimated that runaway climate change could drive as many as 135 million people into poverty by 2030 (World Bank, 2020), erode gains in food security and undermine the sustainability of agrifood systems, which are profoundly dependent on natural resources and climate conditions (FAO, 2023). An estimated US$3.8 trillion in crops and livestock production has been lost due to disaster events over the past three decades, corresponding to more than 5 percent of annual global agricultural Gross Domestic Product (GDP). (The figure would be significantly higher if systematic data were available on losses in the fisheries, aquaculture and forestry subsectors (FAO, 2023).).
The world is currently full of uncertainties. There is need for us to forge innovative solutions that can build resilience and secure communities when nature strikes. It is vital to protect small-scale farmers from the financial burdens of disasters that can be so devastating, if we are to register progress on the SDGs.
The Solution: Financial Resilience in Agriculture Initiative (FRA)
The Financial Resilience in Agriculture Initiative (FRA) is a project of UNDP’s Insurance and Risk Finance Facility (IRFF) implemented in partnership with the Gates Foundation and started running from 2024 -2027. Working with public and private partners in Bangladesh, Ethiopia, India, Uganda and the United Republic of Tanzania. UNDP is looking at bolstering the financial resilience and adaptation capacities of smallholder farmers against climate-related adversities through the design and implementation of innovative agricultural insurance programmes, anchored within a broader development agenda.
In Uganda, the project has brought together key stakeholders including the Ministry of Finance, Planning and Economic Development (MoFPED), Ministry of Agriculture, Animal Industry and Fisheries (MAAIF), Agro-Consortium, Uganda Insurance Association (UIA), Insurance Regulatory Authority of Uganda (IRAU), Uganda Bankers Association (UBS), and the National Agricultural Research Organization (NARO).
The FRA initiative, supported by the Gates Foundation, is a UNDP-led program aimed at strengthening agricultural insurance and risk finance as key components of financial resilience. It seeks to provide practical, scalable solutions for smallholder farmers and agricultural value chains, ensuring they can better withstand climate-related shocks and economic disruptions.Mr. Ian King - UNDP Uganda, Resident Representative
Project Benefits
The FRA project under UNDP-IRFF has multiple benefits and is structured around three key building blocks, each designed to address specific aspects of enhancing financial resilience in agriculture towards climate adaptation. These areas include Enabling Environment, Market Foundations, and Innovation Models. By focusing on these areas, the project aims to implement a comprehensive strategy that encompasses policy development, market support, and innovative solutions to strengthen the agricultural sector's financial resilience in the frame of climate adaptation.
This context is exacerbated by the lack of mainstreaming of risk management into development financing and investment, as well as by the lack of insurance covers and affordable risk finance instruments. There is, for example, an important protection gap in Uganda. The protection gaps exist beyond direct loss of assets to disaster. This insurance gap serves to exacerbate the lack of protection mechanisms available to support the most vulnerable members of society and decrease inequalities.
Financial exclusion, the absence of legislation for mutual and cooperative insurance countries and a wide range of demand and supply issues including issues of awareness, trust, weak distribution, inadequate public policies and institutions, all contribute to this disparity, and to the subsequent diminished resilience of households, enterprises, communities and countries. Challenges relevant to the insurance industry extend beyond the protection of assets, health and livelihoods, to investment. There is a documented need for investment in the Sustainable Development Goals (SDGs) in Uganda. Without engagement from the investment side of the insurance industry, meeting the financing needs of the SDGs will be impossible.
More Insights on FRA outcomes
Enabling Environment
Governments need to see value in the role of agricultural insurance as an enabler for achieving development outcomes, to integrate agricultural insurance into the development agenda, and to institutionalize the agricultural insurance agenda by setting up policies, regulations, programmes and financing instruments. When a government defines its role within the Country market dynamics, it creates a favorable environment that incentivizes market players in turn to define their roles.
Market Foundations
Local technical institutions need to develop in-country market supporting services for governments, especially in relation to evidence generation and impact measurement, and for market players, especially regarding climate and agriculture data, pricing and risk modelling. Partnerships need to be strengthened towards developing tailored in country technical capacities to scale capacity and enable local markets to deliver product solutions. In-country technical capacities and services create sustainability and a competitive talent pool, as well as ownership and trust in the market.
Innovation Models
Market players must build innovative business models to serve smallholder farmers with agricultural insurance products and build the case for the role of agricultural insurance in building the resilience of smallholder farmers and agrifood systems. The goal is to create supply-demand partnerships that integrate the insurance agenda into the business model of products and services delivered to farmers. On the supply side, market players are insurance companies, brokers and reinsurance companies. On the demand side, market players are agrifood systems players such as value chain actors, financial institutions, input providers and digital platforms. Market players may be private or public-led institutions.
For more information, please visit;
Advancing Smallholder Farmers’ Resilience and Adaptation to Climate Change | UNDP IRFF