ROME, Italy, June 13, 2018 /PRNewswire-PRWeb/
-- Agriculture is stepping up in the fight against climate
change with help from the private sector. A new report from the
International Fund for Agricultural Development (IFAD) shows that
investing in climate-resilient agriculture can attract sizeable
contributions from the private sector.
The Business Advantage – Mobilizing Private Sector Led Climate
Actions in Agriculture, a study of IFAD investments through its
Adaptation for Smallholder Agriculture Programme (ASAP), shows that
for every dollar of ASAP investment, between US$0.77–2.85 was leveraged in private-sector
investments - helping countries reach climate finance commitments
scheduled under the Paris climate
agreement.
"IFAD works with the private sector on adaptation investments
that are both financially profitable and socially and
environmentally sound," said IFAD President Gilbert F. Houngbo. "Many of these adaptation
investments were deemed high risk by the private sector, but ASAP
operates as a de-risking or insurance instrument to encourage
business to invest in them."
Previously, in Bhutan the
private sector was wary of investing in small scale dairy farms due
to product quality concerns. With IFAD investment leading the way,
however, local farmers improved the quality of their milk and then
partnered with a local dairy company to create an assured market.
In the first year, the investment ($77,429) was close to 2.5 times the amount
invested by IFAD. The company's supply of milk was greatly improved
while farmers reported their income from dairy sales increased by
54 to 170 per cent.
In Vietnam, a grant scheme was
established by IFAD's partners to finance company business plans
that helped to develop climate resilience among smallholder
farmers. With this approach, the development of the companies was
bound to the development of the rural communities.
With upfront payments and revolving funds paid to farmers by the
project, farmers were encouraged to invest in good cropping
practices and select high-quality seeds, which eventually ensured
high-quality supply of agricultural products to business. The total
investment was close to $1.5 million,
of which IFAD contributed $0.4
million and the remaining $1.1
million was from private companies.
"This report is ground-breaking work that links the private
sector into climate change adaptation by finding opportunities for
partnership that benefit both businesses and smallholder farmers,"
said Bruce Campbell, Program
Director of the CGIAR Research Program on Climate Change,
Agriculture and Food Security, which led the research for the
report. "Public-private partnerships are an essential ingredient of
the agricultural transformation we need to address climate
change."
According to Margarita Astralaga,
Director of IFAD's Environment, Climate, Gender and Social
Inclusion Division, the private sector is becoming an increasingly
important partner in IFAD's work. "While the fundamental goals
underpinning IFAD's purpose have remained constant over the years,
the way by which IFAD is achieving these goals has undergone
changes, with business taking a more central role in the agenda,"
she said. "IFAD wants to include producers in these new
partnerships with business. Valuable lessons are being drawn from
IFAD's experience in partnering with the private sector, via
mechanisms such as public-private-producer partnerships (4Ps),
where business is increasingly recognized as a main force in
development."
For a copy of the Business Advantage Report click on this link:
https://www.ifad.org/web/knowledge/publication/asset/40321995
Contact: Brian Thomson, mobile
+39 3666121101, email b.thomson(at)ifad.org
IFAD has invested in rural people for 40 years, empowering them
to reduce poverty, increase food security, improve nutrition and
strengthen resilience. Since 1978, we have provided US$19.7 billion in grants and low-interest loans
to projects that have reached about 474 million people. IFAD is an
international financial institution and a specialized United
Nations agency based in Rome – the
UN's food and agriculture hub.
SOURCE IFAD