Insurance and the contradictions of the climate-development-finance nexus: The case of the African Risk Capacity

This article considers recent efforts at extending the scope of green finance into insurance schemes to manage the losses associated with the climate crisis in vulnerable countries. Focusing on the case of the African Risk Capacity (ARC), the article argues that these efforts are particularly revealing of the contradictions of what we term the ‘climate-development-finance nexus’ – growing efforts to bridge climate and development activities, with an emphasis on mobilizing green finance in order to do so. In particular, the case of ARC shows how the promotion of insurance should be read as a set of ultimately failed efforts to navigate relations of international financial subordination. Approaching the ARC in this way helps us to understand why the latter has fallen into a shape at odds with the intentions of either member states or the donors who have supported it, the latter illustrated primarily by considering the role of the British Department for International Development. This case, then, is revealing of how green finance more generally is strongly shaped by statecraft within the constraints of existing patterns of financial subordination.