by Will Dickson
Combating the effects of climate change was at the top of the agenda at the first international summit of development banks held in early November. Organized by the French government, the summit comprised 450 banks and resulted in a renewed commitment to small farms in developing countries. Such farms will need at least US$240 billion every year to fight climate changes. Not only are these farming communities the most economically susceptible to climate change, their success also determines whether or not millions go hungry.
According to the UN’s International Fund for Agricultural Development (IFAD), small-scale farmers produce 50% of global food calories whilst in Asia and sub-Saharan Africa, their share of food production jumps to 80% of total production volume. The effects of climate change, particularly drought and erratic weather, threaten devastating consequences not only for the two billion people involved in rural farming communities but also for the populations they feed.
Figures from 2017 and 2018 show that, although annual funding to combat climate change exceeded half a trillion dollars, the vast majority of that money went towards reducing carbon emissions. Less than 2% of those funds, about $10 billion, reached small-scale farmers. However, a report released by IFAD during the development summit estimated that small-scale farmers need about US$240 billion every year to properly mitigate the effects of climate change.
Approximately 690 million people suffered from hunger in 2019, a 10% increase from just five years earlier. The effects of the COVID-19 epidemic alone could push the number of hungry people up by another 135 million by the end of 2020. With further estimates that climate change could decrease crop yields by 25% and drive 100 million food producers into poverty by 2030, the IFAD is pushing for both private investors and governments to invest directly into small rural farms.
In a joint declaration, the banks pledged their commitment to “align” their activities with the objectives of the Paris Agreement. While those objectives are wide-ranging, the pledge made clear the banks’ commitment to phase out investments in fossil fuels in a shift of focus.
The development banks claim they “will help redirect financial flows in support of low-carbon and climate-resilient sustainable development.” In support of this approach, separate loans totaling US$600 million from France’s development agency, AFD, and the Green Climate Fund were made in accordance with the pledge to refocus on sustainable development. The money will go directly towards assisting small-scale, at-risk farms.
Rural farming communities require investment in infrastructure and modernization in order to ensure their farms and crop yields can resist increasingly extreme climates and drought. Drought resistant seeds, improved irrigation, and the expansion of sustainable farming practices are all key elements in not only helping to make rural farms more resilient but also to become more competitive and attractive for future investment. Appropriate investment promises an improved standard of living for the billions who live in those communities, as well as greater food security around the globe as the planet continues to warm.
Following the summit, dozens of funds have been set up to help smallholder farmers whose livelihoods have been impacted by climate change. Affected farming communities exist in every corner of the planet, from Latin America and Africa to Eastern Europe. The IFAD’s Adaptation for Smallholder Agriculture Program (ASAP) has already provided US$300 million in assistance to farmers from 41 countries. Next year, the IFAD will launch ASAP+ with the aim of significantly increasing both the amount of funding and the number of beneficiaries.
