Innovative financing for agriculture, food security and nutrition

Innovative financing for agriculture, food security and nutrition. Online discussion until 9 July 2012. 

Reaching the goal to feed a growing world population is threatened by an important lack of investment in agriculture and a decreasing Official Development Assistance (ODA) in agriculture. To tackle this issue, Innovative Financing Mechanisms (IFMs) are being discussed as a means to complement ODA without replacing it to provide reliable and predictable financing for development and specifically for agriculture and food security and nutrition, especially by catalyzing and encouraging new projects.

At its 9th plenary session in Bamako in June 2011, the Leading Group on Innovative financing for Development considered that innovative financing has the potential to contribute to increase funding for agriculture, food security and nutrition. An International Task Force was established.

The Task Force, supported by an Expert Committee, is expected to produce a report by the end of 2012 which will be presented to the 11th plenary session of the Leading Group on innovative financing for Development.

The literature and debate on Innovative Financing Mechanisms has by now become impressive and some of the proposals are listed in the Annotated List for ease of reference.

Questions of the online discussion:

• What would be innovative sources (public and private) of financing for agriculture, food security and nutrition? New taxes are normally suggested, as can be seen in the annex. Without excluding them, we would like to explore other options.
• What would be innovative uses of funding generated by mechanisms of innovative financing ? What should be their core target(s)?
• What could be new and suitable innovative financing tools for leveraging private investments for agriculture, food security and nutrition? And what could be their advantages/drawbacks?
• How could these identified tools or mechanisms be used for innovative areas of agriculture, food security and nutrition (e.g. climate smart agricultural practices, research, migration)?
• Which actors/stakeholders - at the various levels - would be relevant to mobilise and implement such instruments? What would be their roles and interactions with each other?

Related links and resources:

• List of Innovative Financing Mechanisma for Agriculture, Food Security and Nutrition
• Summary table Innovative Financing
• Leading Group on Innovative Financing for Development

Contribution of PAEPARD:

Several contributions from the participants such as Dimitra Zervaki, José Luis Viveroor PAEPARD have a research related component and indicate that in any case mechanisms have to be revolving and sustainable.

In this connection, one of the areas indicated in the annex refers precisely to this issue. The superiority of public spending on R&D has emerged from several studies as compared to spending in other activities related to agriculture (irrigation, extension, fertilizer subsidies). It is a country specific effort, but countries have in common higher internal rate of return of investment in research as compared to other agricultural investments.

The example of the Platform for African – European Partnership in Agricultural Research for Development proposed by PAEPARD, to involve a diversity of stakeholders (research, public, private partners, all from North and South) is very interesting in terms of R&D.