Climate finance can be channeled to sustainable agriculture at large through small-scale investments. Finance can help profitable businesses that promote biodiversity and conservation, improve productivity, nutrition, and resilience, while also benefiting farmers and their communities. Credit: Priscilla Negreiros/CPI – Climate Policy Initiative
SAN FRANCISCO, California, Sep 22 2021 (IPS) – September 23, 2021 is the first-ever UN Food Systems Summit, convened to mobilize the highest-priority transformations needed to end hunger through the sustainable production and distribution of food. Transforming food systems to ensure food security for all has never been so urgent.
Ongoing waves of Covid-19 and extreme weather events have exposed and multiplied the vulnerability of food systems across the globe, increasing food prices and food insecurity in every country, but especially in countries least equipped to handle multiple, ongoing crises. One-in-four people globally – 1.9 billion – are moderately or severely food insecure. A statistic that is sadly, and unnecessarily, increasing. And by 2050 the world will need to feed an estimated 9.7 billion people, all while protecting natural resources and biodiversity.
Ending hunger by 2030 is a core challenge set by the UN Sustainable Development Goals, but food system transformation is not always high on the list of public funders and private investors. We need to rethink this priority because the potential benefits—economic, social and environmental—are huge. Agriculture, while both a contributor to and a victim of climate change, must and can be part of the solution. Improved climate action in food systems can deliver 20 percent of the global total emissions reductions needed to meet the Paris Agreement targets by 2050, along with other sustainability and resilience benefits.
How does this translate in practical terms?
This can range, for example, from increasing the efficiency of energy-consuming agricultural practices, reducing methane emissions, and using more renewable energy. Regenerative agriculture practices such as cover crops, tillage reduction, and improved grazing remove carbon from the atmosphere and put it back in the soil. Adaptation can mean converting to crops that are less resource intensive and more resilient. We must also support programs that reduce food waste and improve sustainability across the value chain, including changing consumer diet and purchasing patterns.
Climate finance can provide the means to accelerate this critical process, but the slow pace of climate finance is particularly true in the agricultural sector. Cumulative climate finance for agriculture, forestry, and land use represents only 3% of the total tracked global climate finance. This is a crisis, and a missed opportunity, but there are numerous next steps we can take to address these issues.
Use public finance wisely. Governments must make more effective use of public resources and policies targeting capacity building for climate-related finance and incentivizing conservation efforts, rather than on agriculture subsidies that support unsustainable crops and practices.
Channel climate finance to sustainable agriculture at large. We must enhance collaboration between the public and private sectors to mitigate the risk associated with investments in the agricultural sector. Blended finance mechanisms, including guarantees and first-loss tranches, can improve the risk-return profile of small-scale agriculture investments.
Invest with integrity. International and domestic climate flows should stimulate the transition of agri-businesses and its finance service providers towards low emission supply chains. Public, development, and private sectors must work together to further enhance their reporting of climate finance for sustainable foods systems under a common definition and set methodology.
By focusing on these priorities, we can finance profitable businesses that promote biodiversity and conservation, improve productivity, nutrition, and resilience, while also benefiting farmers and their communities.
The UN Food Systems Summit is a great opportunity to harness science, finance, and collaboration to make significant progress towards our 2030 food security goals.
Dr Barbara Buchner is an Austrian economist, with a doctorate in economics from the University of Graz. She specializes in climate finance, and is Global Managing Director of Climate Policy Initiative