An interview with Ines Rocha, International Finance Corporation (IFC), during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”.
Ines Rocha is the Regional Director Europe at the International Finance Corporation (IFC).
Michelle Tang/GDPRD: What are the building blocks for success in reforming the financial architecture for food systems?
Ines Rocha: Before we discuss the building blocks, we need to recognize that globally, food systems actually achieved quite a lot. If we just look at population growth, which went from 1.6 billion people in the early 1900s to 7.6 billion in 2020, that is a lot that food systems need to respond to.
However, there are also hidden social, economic and environmental costs behind food systems, estimated at approximately US$12 trillion. We need to be able to provide healthy foods for an estimated 10 billion people by 2050. This comes with some costs, including carbon footprint and natural capital loss.
Here are some figures to think about: Food systems produce about one-third of greenhouse gas emissions; agriculture uses about 70% of global water usage, making it one of the largest users of land and water in terms of sector; and it is estimated that about one-third of food is wasted or lost. This is in addition to the issue of nutrition, which is not just about providing food, but healthy food.
So, what are the building blocks?
First, reshaping public support. With incentives, we shift away from support for unhealthy types of food and destructive practices to supporting public goods.
Second, factoring in health, environmental and social risks when making investment decisions, thereby accounting for these hidden costs.
Third, scaling up financial products and models. For example, as discussed at the Donor Platform’s 2024 Annual General Assembly, this includes partnerships for supply chains and looking into more equitable food systems through sustainable rural infrastructure, fair prices, fair wages, and a stronger governance system.
These would be the key building blocks.
If we put our minds together and think what the power of partnerships between donors and institutions is, we can find solutions to these global problems.
Ines: The International Finance Corporation (IFC) focuses exclusively on the private sector and is part of the World Bank Group, the largest global development institution. To attract the private sector, we need to foster innovation. This includes not only financial instruments but also innovative technologies to help respond to climate change.
Climate change has a direct impact on food systems and agriculture as we've seen through floods and droughts. We need effective mechanisms of making more resilient food systems, for example, by financing climate resilient crops or regenerative agriculture that nurtures and restores soil.
Another key point is the integration of supply chains. This involves working in a more inclusive and sustainable manner with intermediaries, financial banks and financial institutions, to integrate the small farmers and those at the lower end of the spectrum in terms of end users on the supply chains. There are many examples on how to achieve this through public-private partnerships.
The World Bank has an incredible wealth of knowledge and we focus on training—at the client level and for institutional government counterparts—and knowledge sharing. It is also a knowledge bank and we partner with, for example, certification bodies for sustainable standards.
Group photo at the High-Level Session on "Catalytic Development Finance for a Sustainable and Resilient Future" during the 2024 Annual General Assembly. From left to right: Henry Bonsu, Agnes Johan, Georgia Apson, Ines Rocha, and Chris Isaac.
To attract the private sector, we need to foster innovation. This includes not only financial instruments but also innovative technologies to help respond to climate change.
Michelle: Given your background in fragile contexts and in this increasingly volatile world, how can development investments continue to be available and make the most impact in those contexts?
Ines: The World Bank operates in fragile and conflict-affected countries. I recently returned from a mission to Ukraine. It is very important that we continue to invest there so we have active programmes. In Ukraine, which I know particularly well, the IFC has invested just under US$2 billion since the start of the war supporting key sectors like agriculture. We do that by leveraging donor funds and working with our key partners and shareholders, and by mobilizing private sector investments, which is fundamental. In fact, a great part of the US$2 billion - around US$1 billion from our own accounts - involves mobilizing private sector funds as well as working with companies across different sectors. This includes infrastructure, greening of the energy sector, agriculture, trade, financial institutions and other real economy sectors like tech and IT which are important for innovation.
It's incredibly important to have a forum and events like the Annual General Assembly, so we can discuss the global challenges we face, such as climate change, and the need to promote more inclusive and equitable societies, particularly in fragile and conflict-affected states.
Michelle: What is the one message that you would like the donor community to take away?
Ines: It's incredibly important to have a forum and events like the Annual General Assembly, so we can discuss the global challenges we face, such as climate change, and the need to promote more inclusive and equitable societies, particularly in fragile and conflict-affected states.
A key message on agriculture systems is that if we are to respond to the big challenges based on climate and feed 10 billion by 2050, these forums are important to deliver global solutions.
If we put our minds together and think what the power of partnerships between donors and institutions is, we can find solutions to these global problems.
Learn more about the 2024 Annual General Assembly on "Financing Food Systems Transformation and Rural Revitalization" and the new GDPRD Thematic Working Group on Sustainable/Blended Finance for Food Systems.
Photos: ©Flavio Ianniello/IFAD
