Organization IFC, World Bank, Procom Agr

Year 2002

This paper has three components. The first part argues that weather risk causes substantial inefficiencies in developing countries; agri-businesses, faced with underdeveloped formal financial markets, have to rely on traditional WRM that is associated with underinvestment and overdiversification. We discuss how new WRM can overcome the pitfalls of traditional WRM and have a large development impact. In the second section, we discuss the range of potential uses of new WRM. The final part turns to the operational aspects of a new WRM, studying in detail the case of WRM for cereals in Morocco.