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

This brief is a review of experimental evidence focused on the impacts of finance access on farmers’ investments and how it can enable investments in farms and businesses.

Note on the priority areas of the G20 Sustainable Finance Working Group under the South African Presidency.

The latest Global Outlook on Financing for Sustainable Development calls for a major overhaul of the global system to mobilise resources to build a sustainable future for all.

An interview with Tim Diphoorn, One Acre Fund, during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”.

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”.

An interview with Agnes Johan, Rabo Partnerships, during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”.

An interview with Natasha Hayward, The Global Agriculture and Food Security Program (GAFSP), during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”. GAFSP joined the Donor Platform as a new member in November 2024.

Genna Tesdall shares her vision for empowering youth through cross-sector collaboration. She discusses how the working group provides an ideal platform for this and highlights YPARD’s role in amplifying youth voices, promoting inclusive financing, and enhancing youth engagement in development programs.

An interview with Troels Mahieu-Sorensen, United Nations Development Programme (UNDP), during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”. UNDP joined the Donor Platform as a new member in October 2024.

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.

This brief is a review of experimental evidence focused on the impacts of finance access on farmers’ investments and how it can enable investments in farms and businesses.

Note on the priority areas of the G20 Sustainable Finance Working Group under the South African Presidency.

The latest Global Outlook on Financing for Sustainable Development calls for a major overhaul of the global system to mobilise resources to build a sustainable future for all.

An interview with Tim Diphoorn, One Acre Fund, during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”.

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”.

An interview with Agnes Johan, Rabo Partnerships, during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”.

An interview with Natasha Hayward, The Global Agriculture and Food Security Program (GAFSP), during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”. GAFSP joined the Donor Platform as a new member in November 2024.

Genna Tesdall shares her vision for empowering youth through cross-sector collaboration. She discusses how the working group provides an ideal platform for this and highlights YPARD’s role in amplifying youth voices, promoting inclusive financing, and enhancing youth engagement in development programs.

An interview with Troels Mahieu-Sorensen, United Nations Development Programme (UNDP), during the 2024 Annual General Assembly on “Financing Food Systems Transformation and Rural Revitalization: Opportunities and Challenges”. UNDP joined the Donor Platform as a new member in October 2024.

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.

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