On 27 August 2024, BIOFIN Zambia hosted a workshop in Lusaka that focused on the ongoing study on nature-based financial risks in Zambia. The workshop brought together stakeholders from various sectors, including the financial sector, to discuss the preliminary findings and the potential impact of nature-related risks on the Zambian financial system. The workshop took place at a time when Zambia is grappling with one of the worst droughts in its history, emphasising the urgent need to address the intersection between environmental change and financial stability.
The main objective of this study, funded by the UK Department for Environment, Food and Rural Affairs (DEFRA), is to assess the vulnerability of the Zambian financial sector to nature-related risks. These risks pose a major challenge to economic stability and growth. A similar study was commissioned by the Financial Sector Deepening Africa (FSDA), which focussed mainly on the banking sector. This study builds on this as it covers the financial sector more broadly including capital markets, pensions and insurance in addition to the banking sector. These sectors are also heavily affected by natural disasters, which makes this study a crucial step forward. The study also emphasises the reciprocal relationship between finance and nature.