Global Index Insurance Facility (GIIF) Interview with Steven Collet, Director and Ambassador for Business and Development at the Ministry of Foreign Affairs of the Netherlands

Global Index Insurance Facility (GIIF) Interview with Steven Collet, Director and Ambassador for Business and Development at the Ministry of Foreign Affairs of the Netherlands

On Jan 23, 2020, Steven Collet, Director and Ambassador for Business and Development at the Ministry of Foreign Affairs of the Netherlands, received an interview with the GIIF team in Washington, DC about his policy priorities, his expectations in GIIF, and the newly launched Dutch Fund for Climate and Development (DFCD).

A major donor to GIIF, the Government of the Netherlands, supports the Program in more than 10 countries in Africa and Asia, including special initiatives such as the insuretech-related innovations and the capacity building activities targeted to (re) insurers to establish an end-to-end process during product and business development. The goal is to leverage technology to tackle the distribution challenges faced by implementing partners as well as to ensure that the right knowledge and technological infrastructure become available in-house.  More specifically, the support to the GIIF program from the Netherlands contributes to the growth of the insurance industry in the countries of operation, shown by the increase in the number of insurance companies offering agriculture index insurance (from only a few in 2009 to more than 20 by 2019) as well as in the increased interest and involvement of regional reinsurers, an area which was once taken by international players. To this goal, GIIF has been offering technical training events and workshops, training more than 450 insurance personnel to set the groundwork for launching climate insurance solutions in their countries.

At the Sustainable Economic Department, Mr. Collet is responsible for promoting sustainable value chains, enhancing a sustainable business environment, financial inclusion, creating better employment opportunities, and leveraging the private sector for development.

GIIF:   We understand that climate is a significant component of the Dutch development cooperation policy. What have been your priority action plan to fight climate change since you became the director and ambassador for business and development at the Ministry of Foreign Affairs?

Collet: My job has two focuses: one is to provide private sector development, the other is to enhance private sector engagement. The private sector development is focused on how to generate more jobs, especially for youth and women. To do that in this world of constant and rapid change, we need to have a smart approach. For example, to better fight climate change, some of the entrepreneurs we incubated are focusing on climate-smart agriculture. It is important to find solutions for entrepreneurs to be able to be smart, and this is where GIIF’s great work comes in to facilitate access to finance for smallholder farmers, micro-entrepreneurs, and microfinance institutions through the provisions of catastrophic risk transfer solutions and index-based insurance in developing countries.

On the private sector engagement front, it is about working closely with companies on how to achieve SDGs. Again, we need a lens to invest with them in a climate-smart way. For example, we partner with private sectors on big topics such as deforestation, so we work with value chains, on deforestation reduction, on reducing the risk of destroying our precious forests even more, for the benefits and wellbeing of our future generations.

GIIF: We much appreciate the Dutch government for supporting the majority of our GIIF projects focused on private sector solutions that enhance financial resilience against climate risks for farmers in underdeveloped areas. In the future, what are the strategy advice you foresee for GIIF to scale up its impact? Any regional focus?

Collet: What GIIF is doing is essential. When you partner up with international and local insurance firms to develop index insurance products in Africa and Asia, you are helping small farmers by providing access to financing for the vulnerable; strengthening the financial resilience of the poor against the impact of climate change and natural disasters; and sustaining food production for local communities and larger markets. Moreover, you are also enhancing the private sector development in those regions through capacity building and client delivery.

As for now, I saw GIIF works with insurance and reinsurance companies, monetary financial institutions, banks, cooperatives, and stakeholders in the value chain to implement projects and make real impact on the ground, which is remarkable. Our expectation for GIIF is to scale up and to cooperate with the local governments in regions where you operate. Public-private partnerships will be the key to the next level. It is important to create a model, and it is also essential to prove the concept.

As for the regional focus, our current policy is mainly about African and Arabic regions. But we also work together with different donors and partners across the globe. We consult together and make sure everyone can do their work, then we can generate the skills and resources that are needed.

GIIF: At the CoP 25, we are very excited to see the launch of the Dutch Fund for Climate and Development (DFCD), which will enable private sector investment in projects aimed at climate adaptation and mitigation in developing countries. In addition to the technical assistance and expertise we offer, would you foresee a role for GIIF to provide additionality to those clients?

Collet: The DFCD will focus on several investment themes, including climate-resilient water systems, water management, and freshwater ecosystems, forestry, climate-smart agriculture, and restoration of ecosystems to protect the environment. I could foresee a role for GIIF in the field of climate-smart agriculture, and how to protect the asset as an investor. It is important to have our investment officers realize the value of the essential protection that GIIF is building, because as the risks of climate change increase, agriculture is one of the most affected sectors.

There are a few countries like Nigeria and Kenya, where there might be private sector clients who need GIIF to provide additionality. If those clients have tangible proposals, I hope their awareness can help them to think through the insurance relevance, and once they work with a client, they should partner up with GIIF and see how insurance can play a role. Willingness is the key to successful cooperation.

Photo: Mr. Steven Collet together with Ms. Fatou Assah at GIIF’s global office in Washington, DC