7 Conclusion

It is increasingly clear that preventing further setbacks in global development, and ensuring meaningful progress, will require deep, systemic changes in agrifood systems, supported by investments proportional to the scale of the challenge. The level of resources needed is vastly greater than what is currently being invested, but relatively small in comparison to global wealth and the likely future costs of a business-as-usual approach. An investment cost of approximately US$1.2-1.4 trillion per year, which would transform agrifood systems, could deliver at least a tenfold economic, social and environmental return. Investing in agrifood systems advances climate, health, jobs, gender, biodiversity and peace, simultaneously. No other sector offers this level of cross-cutting return and this level of progress towards global development goals and future prosperity.

The last decade has seen many new innovative and blended financing mechanisms emerge. These show promise and there is much to learn from them, but they are yet to catalyse large-scale private sector financing.

As articulated in the SOFI 2024 report, context is critical. The capacity to finance agrifood systems transformation varies dramatically between low-income and middle-income countries, with countries experiencing fragility and conflict facing particularly difficult challenges. At the same time, in MICs, rural areas that have poor infrastructure and natural resources also face significant difficulties in attracting larger scale private sector investment.

Although future opportunities for growth in the agrifood sector, combined with blended financing, has the potential to drive significant private sector investment, this is far from a universal solution. Governments and the donor community must face the reality that change still requires significant public investment, along with substantial policy reforms that transform agrifood systems, and address health and market externalities.

Despite being under severe pressure, development assistance must remain the bedrock instrument for catalysing action on agrifood systems transformation – supporting LICs and MICs, responding to crises and building long-term resilience. The multilateral system has a critical and irreplaceable role in ensuring that global public goods are available to respond to agrifood systems crises, particularly in low-income and fragile contexts, achieving economies of scale that no bilateral programme can match. Development resources targeted at agrifood systems must be maintained and increased, but they must also be deployed far more catalytically and in a coordinated manner to leverage other financing sources and to drive systemic reforms at global and national scales.

This means bilateral donors and IFIs shifting from fragmented, short-term projects to long-term systems-based programming, harmonizing requirements to reduce transaction costs for recipient countries, and strategically reorienting development assistance to crowd in private capital. National governments need to integrate agrifood systems resilience into national development plans and strategically allocate public budgets to attract donor and private sector co-investment. Private financial institutions and domestic banks, for their part, need to develop financial products that reflect the realities of smallholder and SME finance, ensuring the financial system actively supports sustainable agriculture, food security and resilience.

Key implications for donors are:

1. Engage in a much deeper debate about how to optimize the impact of limited development financing in years ahead.
2. Increase the use of innovative financing mechanisms, which can potentially be more catalytic than fragmented grant-funded bilateral projects, while being realistic about the scale of private finance that can be leveraged.
3. Increase the risk appetite for investments to more effectively de-risk private sector financing into the sector.
4. Advocate for increased ODA for agrifood systems transformation, given the wide range of global public goods than can be generated and the high future costs of not making change.
5. Invest in policy support initiatives which can assist countries, in particular MICs, in reorienting public financing to better support agrifood systems transformation.
6. Support the improvement of the monitoring of financing flows for agrifood systems and the effectiveness of innovative financing mechanisms.
7. Support brokering capabilities and processes needed to bring public and private sector actors together for innovative financing.
8. Recognize and respond to the growing challenges in LICs, particularly those experiencing fragility or conflict.

As articulated in this report, the logical and economic case for the global community to ensure effective financing of agrifood systems transformation is clear. However, further work could be done to provide more evidence on the specific return on investment for development investments. This requires a framework that would integrate perspectives on direct economic return, social returns in terms of food security, peace and stability, comparative development returns with other development investments, and on mutual benefits for donor and partner countries. Such analysis could also look at potential returns for different value chains, types of investment and geographic locations. This is an area of work that the GDPRD will explore during 2026.

The solutions to critical global challenges including tackling climate change, reducing inequality, protecting biodiversity and ensuring human health, all depend on transforming agrifood systems. Agrifood systems are the foundation for stability and peace and core to national security, especially in conflict-affected areas. Now is the time to invest in agrifood systems and the potential future returns for governments and business are large. Not making these investments risks undermining the foundations for future global prosperity, health, peace and stability.