By BISI OLADIPO
The gathering was the 34th annual conference and general assembly of the African Insurance Organization, AIO, in Libreville, Gabon, where insurers, reinsurers, brokers and supervisors of the risk-bearing industry on the continent met to exchange experiences on poverty, and map out strategies on how to reduce the scourge.
From May 19 to 24, 2007, 310 delegates from 48 countries of the association gathered with their counterparts from Asia, Europe, Australia and the Middle East at the Palais International de Conference, Cite de la Democratic.
The ceremony, declared open by Jean Eyeghe Ndong, Gabon’s prime minister, was very brief but devoid of colors. This, in fact, was a pointer to the unpalatable experience the participants had afterwards. It is customary of the association that the first two sessions for presentation of conference papers are organized to take place after the tea break, which follows immediately the conference is declared open. But they did not hold due to the inability of the organizers to make available the necessary conference materials.
However, by the following day, participants were happy that the business of the day started in earnest without any hitch. For the operators, the problem of poverty reduction is a serious issue that must be tackled if the business of insurance must thrive in the continent. Speaking on the conference theme, Leon PAUL N’Goulakia, president of the steering committee for the conference, said, “The difficult situation in which we are living all the population of the world in general and those of Africa in particular does not (allow) insurers (to be) insensitive, that is why the following theme is chosen: ‘Africa Industry of Insurance: Its Role in the Battle Against the Reduction of Poverty’.
“Poverty-reduction on the African continent is a priority for the risk-bearers”, says Mike Ikupolati, director general of West Africa Insurance Institute, The Gambia, who said that the poor are not poor because they have less money. According to him, poverty transcends material abundance but embraces the broader social well-being and quality of life.
A recent United Nations Development Program, UNDP, report shows that of the 315 million pe0ple one in two in sub-Saharan Africa survives on less than one dollar per day, 33 per cent of African population representing 184 million suffer from malnutrition: only one out of five persons enjoy electric power, and less than50 per cent of Africa’s population have access to healthcare facilities.
The report also reveals that only 15 out of 1, 000 surf on the internet (this, notwithstanding the emergence and growth of mobile telephone networks). Only 57 per cent of the children in Africa have not the benefit of primary education and one in six of them die before the age of five. To crown it all, the average income per capita decreased in 20 African countries in the 1990s.
Cause of poverty in Africa have been identified as debt overhang, dictatorship and bad governance, conflicts, population growth, poor food production and sanitation, health and welfare.
Poverty has multiple negative effects according to Ikupolati, they include levels and standards of food consumption inadequate for nutritional and physical health, safe and healthy living, acquisition of knowledge, skills and child care. Poverty also contributes to social exclusion, loss of self-confidence, loss of psychological health, social alienation and absence of commitment to a communal future, he added.
“As the causes of poverty are complex, the strategies for reducing them must take account of their diversity and must be based on careful analysis of its origin and consequences”, says Emmanuel Akin-George, chairman, African Insurance Brokers Association. According to him, brokers’ input in poverty reduction are noticeable in their premium savings through powerful negotiations leading to profit maximization employment generation, loss prevention and training which lead to quality of life and investments.
As for Nigel Easton of the United Nations Conference on Trade and Development Program of Insurance, “in the fight against poverty, aid is only a temporary assistance, while trade is a permanent solution, but people can’t trade without insurance”,. He explained that trade will be at a standstill without it because insurance is essential at the ports, airports, railways, airlines, ships, public transport and road passenger liability. He therefore submitted that insurance is needed for all the stages in the fight against poverty in two areas, namely: aid program for temporary alleviation of hunger, suffering and so on: and by providing commercial/agricultural infrastructure which will create employment opportunities to earn a living above the poverty level.
No doubt, the purpose of insurance is to transfer risk. For many developing countries, international reinsurance, transfers risk from areas of high world poverty to more developed and richer nations who are more able to absorb risk. Ikupolati commended insurance companies for providing micro insurance policies to the poor in their various countries of operations saying, “an analysis of existing attempts will reveal that their efforts are either in direct or indirect involvement of the poor in such activities”. For a poverty solution to work, it must be self-sustaining and supported by sound infrastructure.
Overcoming the problems associated with poverty was a motivation for the participants who at the end of the conference proffered specific conditions that would give Africans the chance to survive and guarantee sustainable development in a continent overwhelmed with armed conflicts and HIV/AIDS.
