Agriculture and Food Security

20 April 2012 | Minutes

Panelists: Sasanka Thilakasiri (Policy Advisor, IFI Economic Justice, Oxfam International), Neil Watkins (Head of Policy and Campaigns, ActionAid America), Julian Oram (Senior Political Advisor,  Greenpeace International), Christopher Delgado (Food Security Advisor, World Bank), and Mark Constantine (Principal Strategy Officer, IFC)

A discussion of IFI financing gaps for sustainable agriculture to meet current and long-term global food security needs. Key issues: reforming agriculture research, technical support, instutitional and legal reforms, and accountability gaps. A discussion on the Bank’s strategy on agriculture in the year of Rio+20.

Organizers: Greenpeace International, Oxfam International, Bank Information Center

Julian Oram

  • Why should there be investment in ecological agriculture? Several reasons: reduced input costs,; income diversification, seasonal spread and greater income potential; yield increases; climate change mitigation and increased resilience; improved food nutritional security and health amongst rural poor; and conservation of agricultural resource base (soil, seeds, water)
  • Smallholder agriculture is key
  • Some or the constraints are: it is knowledge intensive, lack of data,  and land rights concerns
  • Also presents fewer opportunities for agribusiness / large scale agriculture
  • There is also institutional caution and inertia
  • This has implications for donor funding, but very little information on the role of multilateral donors
  • There is a need for better indicators for monitoring and evaluation
  • Donors can help identify private sector partners
  • World Bank needs institutional strategy to eco agriculture
  • Also need better baseline data and reporting to provide transparency and data

Neil Watkins

  • The Global Agriculture and Food Security Program (GAFSP) was established Apr 2012, with nearly USD 1bn in funds, small secretariat at WB
  • Principles of country led agricult investment plans as country ownership, strong monitoring and evaluation element, with provisions for transparency and civil society participation
  • Governance structure: public sector window – innovative, governed by steering committee, equal split donors and recipient countries. WB as non voting member. CSOs: 2 farming organisations, and Action Aid non-voting members.
  • Inclusive process and strong emphasis Civil society participation, can present in steering committee meetings
  • Post project approval civil society reps can travel to projects
  • Farming organisations are involved from beginning until implementation CSOs developed participation guidelines on request from the steering committee, including scoring
  • Challenges: representation uneven on country level
  • Could do more to incentivise innovative projects, actively targeting the poorest and most margilnalised
  • Private sector window not the same governance model, no CSO role
  • Could incentivise farmer and CSO engagement on country level in particular
  • Agroecological approaches could be promoted
  • Lessons for other donors and CSOs, could use ideas from or other processes
  • Should support country plans

Sasanka Thilakasiri, Oxfam

  • New report Risky Business: Intermediary lending and development finance, on the use of financial intermediaries (FIs) in development lending, eg land investments
  • Raises questions in regards to food security
  • Lending to FIs provide funding to commercial banks, PE funds, hedge funds
  • Can be positive, eg helps to provide market access to SMEs, but particular issues in terms of land
  • Overall priorities need to be looked at, including conflict of interests
  • FIs primarily profit driven, not poverty eradication
  • Lot of funding go to markets that are over capitalised
  • Sometimes to fail achieve the leverage, in terms of reputational leverage
  • No performance standards, and once funding disbursed leverage function gone
  • Risk categorisation, eg. Category A projects need 60 days notice, but FIs different categories and also disclosure only after funding has been lent.
  • Metrics and development indicators big omission
  • Opportunities for redress lacking
  • To date two CAO cases, both on land, on FIs, could be more with better awareness
  • No standardised way of which FIs gets selected, needs screening eg including safeguards – otherwise shouldn’t do any land based investments by FIs

World Bank respondent

  • There is a consensus regarding food security about the role of small scale farmers (SSFs)
  • Problem, too many people hungry, 70% more food needed
  • Many constraints for SSFs – prices volatility, production costs go up, yields grow too slow, increase in land and water constraints, climate change
  • WB in WDR on agriculture argued that it is beneficial for growth – since then increase in agricultural spend to around USD 7bn per year
  • Core priority to raise agricultural productivity
  • Regarding ecological farming, many poor are ecological as can’t afford fertilisers
  • Rising yields, improve access to markets, improving agricultural practices are important
  • Amount of trust funds devoted to agriculture doubled in past few years, eg importancde of GASFP
  • Agree more needs to be done to target poor and marginalised farmers
  • Safeguards core, a lot can be improved, but powerful

IFC respondents

  • Agribusiness has 2 conflicting areas: stress areas and development, food security and hunger
  • Food security, need increased investment and enhanced productivity, incl inclusivity, small holders women in particular
  • Environmental and social elements should be a business driver, not compliance
  • Strategy to increase investment, tailor investment
  • GASFP private sector window with relaunch this weekend
  • Struggling with donor contributions to private sector window, partly due to struggle to defining what to do with the funding
  • Designed to take higher risks, concessional funding below market pricing (IFC goes in at the market rate) – blended finance products, private plus GASFP funding to get private sector into the market, in particular in IDA countries where there is hesitation
  • Need more collaboration between public and private sector window
  • Development outcome tracking needed, balanced with cost
  • IFC processes incl governance implemented in GASFP
  • environmental and social tools, pilot with matrix on FI clients
  • working on handbook for agricommodities’ supply chain
  • developing child labour monitoring tool
  • Updated performance standards has been updated and effective 1 Jan 12, now categorisation for FIs
  • Regarding more funds and strategy for ecological agriculture – need to show where it can be done on scale
  • Re transportation, recognise linkages as a lot of food available that doesn’t get delivered due to lack of transportation, etc.
  • Good farming systems, better management practices would make a big difference to negatives of agriculture