World: FAO’s Investment Centre doubles down on efforts to create more robust and sustainable agri-food systems

Country: World Source: Food and Agriculture Organization of the United Nations Q A with FAO Investment Centre Director 26 February 2021, Rome - Mohamed Manssouri, Director of FAO s Investment Centre discusses the Centre s work and expansion plans. What s the FAO Investment Centre? Simply put, the FAO Investment Centre creates investment solutions in sustainable food and agriculture. The Centre offers a range of investment support services helping countries to create long-term investment policies and plans, to design and implement investment projects with financing partners and to generate knowledge and build capacities related to investment. A distinctive characteristic of the Centre is that it works almost exclusively through partnerships with financial institutions and member country governments. Better investment in food and agriculture leads to more efficient and equitable agri-food systems as well as greater resilience in the face of climate change and other shocks such as COVID-19. What s new is that FAO members have recently agreed to inject significantly more resources into the Centre - enabling it to expand, provide more in-depth investment support to countries and strengthen its collaboration with international and national financial institutions and other development partners. As FAO Director-General QU Dongyu said: together, we are transforming agriculture and agri-food systems through targeted investment, innovation, knowledge and strengthened capacities. In 2020, working with partner international financial institutions and with our member country governments, we helped mobilize $6.6 billion of public investment projects to create stronger and more sustainable agri-food systems. That s an increase of $900 million (16%) compared to 2019 and an increase from 32 to 38 projects. In sub-Saharan Africa alone, last year we supported the design of $2 billion new public investments that will provide people with access to healthy food and create jobs. A good example is the Joint Programme to Respond to the Challenges of COVID-19, Conflict and Climate Change, benefitting six countries in the Sahel by investing in agricultural infrastructure, innovative technology as well as human and social capital in cross border areas facing security issues. Both FAO and World Food Programme (WFP) will be supporting the G5 Sahel Secretariat and International Fund for Agricultural Development (IFAD) in project implementation. The cost of the project is $180 million over six years of which 109 million financed by IFAD and $71 million by the Green Climate Fund. Also last year, we supported the implementation of projects worldwide in some 120 countries. This consists of providing critical technical support to governments during the projects implementation period (typically around five years) to make sure that investments are on track to deliver the desired outcomes. The Centre s multidisciplinary teams can address implementation issues related to all aspects of agriculture and rural development including infrastructure and irrigation, agriculture, livestock, fisheries, forestry, etc. The Centre also provides support to better soft investments in human and social capital and capacities, governance and institutions, farmer organizations and community development. You mentioned COVID-19. Could you tell us about the Centre s work in relation to this? Countries have been looking to FAO for policy guidance on responding to COVID-19 and technical assistance to ongoing projects. In response, we provided timely policy advice, undertook rapid impact assessments of COVID-19 on agri-food systems to inform countries decisions and solutions to mitigating the negative effects of the pandemic on their food and agriculture sector. With investment partners such as the World Bank - the Centre s oldest and largest partner - we developed response packages and reoriented ongoing projects to address the COVID-19 challenges. With the European Bank for Reconstruction and Development (EBRD), we established a ($3 million) technical response facility to help the agri-food sector to overcome COVID-19 challenges and to strengthen agri-food systems longer-term resilience. With the European Commission, we are undertaking rapid agri-food systems assessments in many countries - by end of 2021 we aim to reach 61 countries, among the most affected by food insecurity and malnutrition. The assessments are only the first step. The work will help to shape new policy recommendations in food and agriculture, and potential private and public investments in agri-food systems transformations in those countries. We are also working with many partners, including European Development Finance Institutions, to help de-risk investments in the agri-food sector - a sector marked by uncertainty and volatility even at the best of times. We are also integrating COVID-19 response activities into the Global Agriculture and Food Security Program (GAFSP) projects in countries such as Bangladesh, the Central African Republic, Ethiopia, Haiti, Senegal and Yemen. The Centre has also stepped up its actions to increase visibility and influence public debate on the need for investment in agri-food systems as the world works towards building back better. We have a good track record of bringing stakeholders together from the public and private sectors, including farmers and their organizations, to discuss policy issues and resolve bottlenecks. In parallel, the Centre has been key to the rolling out of the poverty-focused Hand-in-Hand Initiative in close to 40 countries. (Note: more info on the Centre and its work on COVID-19 here). Apart from supporting the COVID-19 response, could you give some other examples of the Centre s work and key achievements in 2020? Good investment design is fundamental, but you also need effective implementation to make a positive impact in people s lives. Our investment team plays a substantial role in supporting the successful roll-out of publicly funded investment projects - irrespective of whether we were involved in their design or not. This can range from supporting the modernization of digital land registries in Europe and Central Asia, long-term support to pastoralists in the Sahel, water management in the Caribbean or rural entrepreneurs and trade in the Pacific. The Centre casts a wide footprint when it comes to delivering impact at country level. We also forged new partnerships with financing institutions to expand our investment support, and new collaborations are being built with the European Investment Bank, the Asian Infrastructure Investment Bank and others. Mindful that public money alone is not enough to end poverty, we are creating new and innovative partnerships to transform how development is financed, especially through blended finance - the use of public or philanthropic money combined with private investment into businesses that generate social and environmental impacts alongside financial returns. For example, we are working with the European Commission, through the AgrIntel initiative, providing advisory services to impact funds and blended finance operations investing in small and medium agribusinesses through equity and loans. Blended finance is certainly an area to watch. Since we began, our team has supported the EU to review over 124 blended finance proposals worth EUR 609 million. Funding has already been cleared for 23 proposals worth EUR 96 million. In collaboration with the EU Delegation in Uganda*,* the Centre is strengthening the national Uganda Development Bank (UDB) to finance responsible private investments in food and agriculture. Blending FAO s knowledge and expertise with finance and working with national and international financial institutions will help our member countries achieve the impact at the scale required to achieve the SDGs. The Centre is also teaming up with research centres to advance knowledge in digital agriculture, human capital, and foster opportunities for rural youth and women across the food value chain. Another key area is green and climate financing, helping countries better tap into this type of financing. Both directly as FAO and with financing partners, we unlocked around $675 million of green financing with the Green Climate Fund between 2018-20. What s ahead for the Centre? What are some of the main priorities over the next years? We will continue to work with international financial institutions and banks on ways to strengthen the resilience of the agri-food systems. This means helping public and private actors to transition to greener and better production systems that offer better nutrition without harming the environment, and ultimately leading to a better life for all. We will also continue to enable and promote the use of new data sources and climate-sensitive technologies (like geospatial data, digital applications and drones) to create better investment planning, risk management and lower interest rates for farmers. We look forward to supporting national banks in more countries to enable them to finance more and better farmer and private investments in sustainable food and agriculture. What are the key ingredients for creating sustainable growth? I would sum it up as: a clear long-term strategy, improved policy environment and critical public investment to accelerate the adoption of innovation including digital and green technologies and practices, alongside basic infrastructure. Public investment is critical to catalyze private investment, particularly in finance. Meeting the SDGs - from ending poverty and hunger to building a more equitable, healthier and greener world - calls for more blended financing. Increasing efficiencies in the food system must also go hand-in-hand with reducing inequalities, creating decent jobs and livelihoods for women and youth especially. In this respect, public investment in human capital of the men and women who produce, process and trade food (especially small-scale farmers) is essential as an enabler for all the rest: growth, sustainability, equality and inclusiveness. There is a need for urgent action to transform agri-food systems. The resources - intellectual, financial and material - are there, but we must be better organized and coordinated so that the world s efforts are not too late and ineffective for too many people.

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