CFI.co Meets Mohamed Beavogui & Simon Young

African Risk Capacity: Mohamed Beavogui and Simon Young

African Risk Capacity (ARC), an organisation helping African governments manage natural catastrophe risk, has gained major international attention in recent months. ARC was endorsed by G7 Leaders in May 2015 as the model upon which to expand climate risk insurance across developing countries.

ARC received further pledges of support as a key component of addressing loss and damage from climate change at the Paris UN-FCCC COP21, and is recognised as an embodiment of the UN Secretary General’s Climate Resilience Initiative – anticipate, absorb, reshape – as highlighted in the SG’s report for the World Humanitarian Summit One Humanity: Shared Responsibility.

Two leaders are guiding its rise, directing ARC across its two entities – ARC Agency, a specialised agency of the African Union which engages directly with its member African governments, and its financial affiliate ARC Insurance Company Limited (ARC Ltd), a mutual insurer implementing highly cost-efficient coverage for climate risk for member countries using a strong capital base and tapping the international risk markets.

Mohamed Beavogui has been leading ARC Agency as director general since September 2015 and is already applying his vast experience in agriculture finance and institution-building to shape the future of ARC. He works alongside ARC Ltd CEO Dr Simon Young who has launched and run the insurance company for the past two years after having set up a similar risk pool in the Caribbean.

The management team collectively runs ARC by playing to their strengths, with Mr Beavogui tapping into his development experience and network of high-ranking African officials while Dr Young draws on his extensive natural catastrophe risk modelling skills and his experience working with reinsurance and weather markets on emerging market projects.

The pair have come to ARC from very different backgrounds, both specialists in their own sector.

A volcanologist by training, Dr Young first worked for the British Geological Survey after completing his PhD and was the first director and chief scientist at the Montserrat Volcano Observatory during the peak phase of the volcanic eruption which devastated large parts of the island.

After years of helicoptering over active volcanoes, Dr Young moved into the natural catastrophe risk management and financing field, building a reputation as a leading expert over the subsequent fifteen years.

During this time, he worked with numerous private and public sector organisations on disaster insurance and risk reduction projects in Latin America, the Caribbean, and most recently in Asia-Pacific and Africa.

“I was interested in helping vulnerable communities and countries better understand and manage their natural disaster risk and also wanted to explore and test how financing tools such as insurance could be used as part of the solution to dealing with catastrophe risk, particularly in light of the rapid rise in vulnerability due to economic development and climate change,” Dr Young says.

Dr Young was a leading member of the consulting team which created the Caribbean Catastrophe Risk Insurance Facility (CCRIF), a natural disaster insurance pool for the Caribbean islands. He also advised CCRIF on its expansion into Central America and on structuring and placement of the CCRIF Cat Bond, the first to be placed through the World Bank Treasury, in 2014.

Appointed the inaugural CEO of ARC Ltd in 2014, Dr Young has been managing the operations of ARC Ltd as well as the insurance underwriting and international risk transfer processes. Mr Beavogui, on the other hand, has been working in development for over thirty years with a focus on policy, strategy, project management and the building of public-private partnerships. An engineer and trainee of Harvard Kennedy School, the Guinean national rapidly rose through the ranks of the UN Food and Agriculture Organisation before moving to the UN Office for Project Services as regional director for West and Central Africa.

In 2001, Mr Beavogui joined the International Fund for Agricultural Development (IFAD), becoming part of the management team as director for Africa and subsequently director of Partnerships and Resource Mobilisation, where he delivered lending and grant programmes, managed IFAD’s portfolio of projects, and was senior advisor to the IFAD president.

Last year, ARC’s African member countries elected Mr Beavogui to become ARC Agency’s first fixed-term director general. “I was honoured to have been chosen to join ARC, an entity which is enabling my continent, Africa, to lead in one of the most collaborative solutions to climate change yet,” says Mr Beavogui.

The management duo is united in their drive to make ARC a major instrument in managing natural catastrophe risk across Africa, ranging climate perils such as droughts and floods to potential outbreaks of disease.

“ARC has been developed as an African solution to tackle African problems. The model was proven in its first year when it paid out more than $26m to countries in the Sahel following a drought, helping 1.3 million affected people,” the ARC Agency director general said. “We aim to continue the expansion of ARC across the continent, with a target of efficiently managing $2bn in climate risk by 2020, protecting more than 150 million vulnerable people in Africa.”