Workstreams

Sustainable and blended financing for SDG2

The GDPRD and the Shamba Centre for Food & Climate have undertaken an enquiry on how to make donors and public funds more catalytic for food systems through sustainable and blended financing approaches. The investigation included a series of interviews which explored how donors, philanthropic organizations, public funds and blended capital funds can make their funding effective and act as an incentive for achieving SDG 2.

The GDPRD stands ready to lead. With 258 million people in 58 countries facing acute food insecurity, there is no time to lose.

The core message of the enquiry indicates that if donors and development banks take higher risks with their grants and lending, every donor dollar has the potential to generate four dollars in commercial finance. When this happens, agrifood small and medium-sized enterprises (SMEs) will have more financing, domestic lenders will participate, and markets will have more liquidity. This is the catalytic power of aid.

The final report “Unleashing the catalytic power of donor financing to achieve SDG2” presents four key findings and recommendations from the enquiry.

2023 Workstreams

Sustainable financing for food systems

The GDPRD and the Shamba Centre for Food & Climate have undertaken an enquiry on how to make donors and public funds more catalytic for food systems through innovative financing approaches. The investigation included a series of interviews which explored how donors, philanthropic organizations, public funds and blended capital funds can make their funding effective and act as an incentive for achieving SDG 2.

The GDPRD stands ready to lead. With 258 million people in 58 countries facing acute food insecurity, there is no time to lose.

The core message of the enquiry indicates that if donors and development banks take higher risks with their grants and lending, every donor dollar has the potential to generate four dollars in commercial finance. When this happens, agri-food small and medium-sized enterprises (SMEs) will have more financing, domestic lenders will participate, and markets will have more liquidity. This is the catalytic power of aid.

The final report “Unleashing the catalytic power of donor financing to achieve SDG2” presents four key findings and recommendations from the enquiry.

Workstream Activities

Co-Chairs Bruce Campbell (Swiss Agency for Development and Cooperation - SDC) and Federica de Gaetano (Italian Agency for Development Cooperation, AICS) are featured in the Devex 2024 Global Voices list, for their opinion piece on “How blended finance can catalyse private capital for agriculture”, originally published on 1 October 2024.

A new IFAD report outlines findings from 14 sample private sector engagement programmes across the Near East, North Africa and Europe region.

New report on the impact of migration, migrant remittances and diaspora finance on climate resilience in countries of origin from IFAD's Financing Facility for Remittances (FFR).

An interview with the Academic Advisor of the Thematic Working Group on Sustainable and Blended Finance for Food Systems, Sabine Desczka of Wageningen University and Research.

An interview with the Co-Chairs of the new GDPRD Thematic Working Group on Sustainable and Blended Finance for Food Systems, Tuleen Alkhoffash of the International Fund for Agricultural Development (IFAD) and Songbae Lee of the USAID Bureau for Resilience and Food Security.

This International Growth Centre (IGC) evidence review maps the existing body of practitioner and academic evidence on lending to agricultural small and medium-sized enterprises in developing economies and identifies research and learning priorities to fill key gaps.

This year's report is focused on financing to end hunger, food insecurity and malnutrition in all its forms. A definition of financing for food security and nutrition and guidance is provided with recommendations regarding the efficient use of innovative financing tools and reforms to the food security and nutrition financing architecture.

The 2024 State of the Sector report shares market insights drawing upon quantitative and qualitative input from 20 financial institutions and provides a deeper analysis of the risks agri-SMEs and lenders face, and how agricultural lenders can respond.

The global green transition is a critical priority, but it risks overshadowing another urgent crisis: the deepening poverty and inequality in low and middle-income countries.This report offers policymakers concrete ways of delivering on their commitments, to reconcile these competing priorities, improve the lives of billions while fostering a greener, more equitable world.

In an era in which almost 80 percent of the global population resides in urban and peri‑urban (U‑PU) areas, understanding and addressing the complexities of U‑PU food systems is more critical than ever.

Co-Chairs Bruce Campbell (Swiss Agency for Development and Cooperation - SDC) and Federica de Gaetano (Italian Agency for Development Cooperation, AICS) are featured in the Devex 2024 Global Voices list, for their opinion piece on “How blended finance can catalyse private capital for agriculture”, originally published on 1 October 2024.

A new IFAD report outlines findings from 14 sample private sector engagement programmes across the Near East, North Africa and Europe region.

New report on the impact of migration, migrant remittances and diaspora finance on climate resilience in countries of origin from IFAD's Financing Facility for Remittances (FFR).

An interview with the Academic Advisor of the Thematic Working Group on Sustainable and Blended Finance for Food Systems, Sabine Desczka of Wageningen University and Research.

An interview with the Co-Chairs of the new GDPRD Thematic Working Group on Sustainable and Blended Finance for Food Systems, Tuleen Alkhoffash of the International Fund for Agricultural Development (IFAD) and Songbae Lee of the USAID Bureau for Resilience and Food Security.

This International Growth Centre (IGC) evidence review maps the existing body of practitioner and academic evidence on lending to agricultural small and medium-sized enterprises in developing economies and identifies research and learning priorities to fill key gaps.

This year's report is focused on financing to end hunger, food insecurity and malnutrition in all its forms. A definition of financing for food security and nutrition and guidance is provided with recommendations regarding the efficient use of innovative financing tools and reforms to the food security and nutrition financing architecture.

The 2024 State of the Sector report shares market insights drawing upon quantitative and qualitative input from 20 financial institutions and provides a deeper analysis of the risks agri-SMEs and lenders face, and how agricultural lenders can respond.

The global green transition is a critical priority, but it risks overshadowing another urgent crisis: the deepening poverty and inequality in low and middle-income countries.This report offers policymakers concrete ways of delivering on their commitments, to reconcile these competing priorities, improve the lives of billions while fostering a greener, more equitable world.

In an era in which almost 80 percent of the global population resides in urban and peri‑urban (U‑PU) areas, understanding and addressing the complexities of U‑PU food systems is more critical than ever.

Background and rationale

Finance workstream webpage (2)

An additional US$33 billion in public spending is needed to trigger US$52 billion in private investment every year

The Ceres2030: Sustainable Solutions to End Hunger Summary Report, published in 2020, states that to achieve SDG 2, middle-income countries and donors will need to increase their spending on food systems each year by US$19 billion and US$14 billion, respectively.

Finance workstream webpage (9)

Donors, philanthropic organizations, and public funds are working to increase the impact of their funds.

As climate change, water scarcity and biodiversity losses intensify and are further compounded by economic uncertainties, food security remains a critical issue.

Finance workstream webpage (10)

The challenge is to accelerate the transition to sustainable global food systems and achieve the SDGs.

The time is now to figure out how to make donors and public funds more catalytic for food systems through innovative financing approaches.

Workstream objectives and activities

The workstream will explore how donors, philanthropic organizations and public funds are:

  • Making their funding more catalytic

  • Increasing allocations to foods systems from thematic programmes on climate, nature, gender, and SMEs

  • Working with private capital providers to increase investment in sustainable food systems

  • Assessing the performance and ‘additionality’ of blended capital funds and whether they serve as a critical strategy to increase investment in food systems

Workstream activities:

  • The Shamba Centre will conduct interviews with selected donors, philanthropic organizations, public funds, and blended capital funds to further explore these points, learn what has been their experience with blended financing strategies, and how they are making their funding more impactful.

Deliverables and results

  • Recommendations for donors will be developed from the interviews and research findings.

Talking about Finance

Talking about Finance

Climate, nature, water, nutrition and gender are not considered in credit risk assessments and investment decisions in sustainable food systems. This is a market failure that donors must address as non-sustainable businesses will suffer heavy losses as extreme weather sets in.

Climate, nature, water, nutrition and gender are not considered in credit risk assessments and investment decisions in sustainable food systems. This is a market failure that donors must address as non-sustainable businesses will suffer heavy losses as extreme weather sets in.

We need an extra US$330 billion to end hunger without harming the environment by 2030. This decade, our challenge is to use the catalytic power of governments and donors to unleash the financial power of capital markets for the benefit of everyone.

We need an extra US$330 billion to end hunger without harming the environment by 2030. This decade, our challenge is to use the catalytic power of governments and donors to unleash the financial power of capital markets for the benefit of everyone.

CONTACT | GDPRD

Maurizio Navarra

Secretariat Coordinator at the
International Fund for Agricultural Development (IFAD), Rome/Italy

CONTACT | GDPRD

Sierra Berardelli

Secretariat Consultant at the
International Fund for Agricultural Development (IFAD), Rome/Italy