Diaz-Bonilla, Eugenio
Wo king Pape
Financing "a sus ainable ood u u e": Some hough s o
he G20
Economics Discussion Pape s, No. 2018-73
P o ided in Coope a ion wi h:
Kiel Ins i u e o he Wo ld Economy – Leibniz Cen e o Resea ch on Global Economic Challenges
Sugges ed Ci a ion: Diaz-Bonilla, Eugenio (2018) : Financing "a sus ainable ood u u e": Some
hough s o he G20, Economics Discussion Pape s, No. 2018-73, Kiel Ins i u e o he Wo ld
Economy (I W), Kiel
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Discussion Pape
No. 2018-73 | Oc obe 09, 2018 | h p://www.economics-ejou nal.o g/economics/discussionpape s/2018-73
Financing “a sus ainable ood u u e”: some hough s
o he G20
Eugenio Diaz-Bonilla
Abs ac
Achie ing a “sus ainable ood u u e” ( he i le o one o he h ee p io i ies iden i y by he
go e nmen o A gen ina o he 2018 G20 p esidency) equi es building ood sys ems ha , in line
wi h he ela ed Sus ainable De elopmen Goals (SDGs), suppo g ow h and employmen ,
ensu e social inclusi eness and equi y, p omo e clima e esilience and en i onmen al
sus ainabili y, p o ec biodi e si y, and gene a e heal hy die s o all. Many policy, ins i u ional,
echnological and in es men inno a ions a e needed o build such ood sys ems. This pape
ocuses on he inancing o he u iliza ion o adequa e echnologies and inno a ions in ag icul u al
p oduc ion, including he ones ela ed o soils, land, wa e , ecosys ems, and, in gene al, hose ha
ha e been called Clima e Sma Ag icul u e (CSA) o Clima e- iendly Sus ainable Ag icul u e
(CFSA). I explo es se e al op ions o mobilize inancial esou ces o suppo in es men s in hose
echnologies and sus ainable ood sys ems a he scale needed o ha e some meaning ul global
impac . In pa icula , i a gues ha he c ea ion o a p ojec p epa a ion and inancial s uc u ing
acili y o app op ia e scale would help le e age sca ce public-sec o unds o mobilize he much
la ge pool o p i a e inancial unds ha may be in e es ed in pa icipa ing in hese in es men s bu
now lack adequa ely s uc u ed p ojec s and in es men ehicles o do so.
(Submi ed as Global Solu ions Pape )
JEL F3 F35 G2 H5 O13
Keywo ds In e na ional inance; o eign aid; inancial ins i u ions and se ices; na ional
go e nmen expendi u es; ag icul u e; ood sys ems; Clima e Sma Ag icul u e (CSA)
Au ho s
Eugenio Diaz-Bonilla, In e na ional Food Policy Resea ch Ins i u e (IFPRI),
e.diaz- bonilla@cgia .o g
This pape d aws on Díaz-Bonilla, E., Lobogue e o, A. M., Ve cho , L., Viglizzo, L. and Mi zabae , A.
(2018). Financing “A Sus ainable Food Fu u e”. CIPPEC.; Díaz-Bonilla, E. (2018). El inanciamien o de
‘Un u u o alimen a io sos enible’: Algunas e lexiones pa a el G20. Agenda In e nacional, no. 40: 24.;
and Díaz-Bonilla E. and V. Callaway ( o hcoming). The G20, Global T ade and In es men Regimes, and
a Sus ainable Food Fu u e, chap e in “F om C isis Managemen o Vision and Leade ship? The G20,
Global T ade, and Sus ainable De elopmen ” ICTSD. Gene a.
Ci a ion Eugenio Diaz-Bonilla (2018). Financing “a sus ainable ood u u e”: some hough s o
he G20. Economics Discussion Pape s, No 2018-73, Kiel Ins i u e o he Wo ld Economy.
h p://www.economics-ejou nal.o g/economics/discussionpape s/2018-73
Recei ed Sep embe 25, 2018 Accep ed as Economics Discussion Pape Sep embe 27, 2017
Published Oc obe 9, 2018
© Au ho (s) 2018. Licensed unde he C ea i e Commons License - A ibu ion 4.0 In e na ional (CC BY 4.0)
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
2
INTRODUCTION
A gen ina has de ined h ee main p io i ies o i s 2018 P esidency o he G20: “The u u e o
wo k”; “In as uc u e o de elopmen ”; and “A sus ainable ood u u e.” This a icle ocuses
on he la e opic. Wi hin i , he A gen ine au ho i ies ha e highligh ed he issue o “imp o ing
soils and inc easing p oduc i i y.” He e, he impo an challenge ela ed o soils and
p oduc i i y is placed wi hin he b oade amewo k o he de elopmen and u iliza ion o he
adequa e echnologies and inno a ions, ela ed o land,1 wa e , ecosys ems, and, in gene al,
hose ha ha e been called Clima e Sma Ag icul u e (CSA) o Clima e- iendly Sus ainable
Ag icul u e (CFSA). This a icle also ecognizes ha he de elopmen and u iliza ion o he
adequa e echnologies and inno a ions a e only a componen (al hough a e y impo an one) o
a a ie y o ac i i ies needed o achie e he hi d p io i y highligh ed by A gen ina. Wi hin ha
con ex , his a icle looks a op ions o inance he ac i i ies needed o scale up he u iliza ion o
CSA/CFSA echnologies.
Wha ollows is di ided in o ou sec ions. Fi s , he e is a b ie discussion o he b oade
aspec s ela ed o he challenge o building a “sus ainable ood u u e.” Then, i ollows a b ie
discussion o some es ima es o he di e en cos s o build such u u e. The hi d sec ion, which
is he ocus o his a icle, discusses al e na i es o mobilize he inancial esou ces o suppo
in es men s in hose echnologies and sus ainable ood sys ems a he scale needed o ha e some
meaning ul global impac on p oduc i i y, incomes, and sus ainabili y. In ha sense, he
challenge is simila o he second p oposal p esen ed by he A gen inean P esidency ega ding
he need o mobilize inancial esou ces o in es men s in sus ainable in as uc u e. The ou h
sec ion concludes.
THE CHALLENGE2
Soil and land
The global de e io a ion o soils, land and ecosys ems poses a signi ican h ea o po e y
educ ion, sus ainable ood p oduc ion, and he adap a ion o, and mi iga ion o , clima e change.
Abou 52 pe cen o he land used o ag icul u e is mode a ely o se e ely a ec ed by soil
deg ada ion, a ec ing mo e han 1.5 billion people globally. Due o d ough and dese i ica ion,
12 million hec a es o p oduc i e land a e los annually. Soil e osion is he mos se ious o m o
land deg ada ion, wi h be ween 24 and 74 billion ons o soil los e e y yea . Due o popula ion
p essu e and o e use o ag icul u al lands wi h limi ed inpu applica ion, soil nu ien deple ion
is ano he se ious land deg ada ion p oblem in many pa s o he wo ld (see o example,
Nkonya, E., A. Mi zabae and J. on B aun, 2016).
_________________________
1 Land means he e es ial bio-p oduc i e sys em ha comp ises soil, ege a ion, o he bio a, and he ecological and hyd ological
p ocesses ha ope a e wi hin he sys em (IPBES, 2015).
2 Based on Díaz-Bonilla, Ve cho , Lobogue e o, Viglizzo and Mi zabae , 2018.
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
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Land deg ada ion is also a po e y issue, wi h a la ge pe cen o he poo di ec ly a ec ed by
hose p oblems. I also has ad e se implica ions o nu i ion. Cu en ly, abou 2 billion people
a e es ima ed o su e om di e en mic onu ien de iciencies (De elopmen Ini ia i es, 2017)
and soils ha e a ole o play in his p oblem. Mos essen ial nu ien s and mine als (e.g. zinc,
i on, iodine) canno be de i ed om biosyn hesis and mus be ob ained by plan s om soils and
acqui ed by humans h ough he oods hey consume. The e o e, local mine al de iciencies in
soils p oduce de iciencies in local ood sys ems, which clinically impac s popula ions.
The goal he in e na ional communi y should be o inc ease he a ea o heal hy soils ha p o ide
adequa e nu i ious ood, p oduce adequa e ibe and o he p oduc s, and suppo
ag oecosys ems in p o iding o he impo an ecosys em se ices h ough a biological app oach
o soil managemen . Achie ing his goal equi es enhanced awa eness o he biological aspec s
o soil heal h and imp o ed mechanis ic and quan i a i e unde s anding o he ela ionships
be ween soil heal h, clima e change, and esilience o ag icul u al p oduc ion sys ems.
Beyond soils and land
While, as no ed, in 2018 he A gen ine p esidency o he G20 ocused on soils, he p e ious
yea , wi h he Ge man p esidency, he emphasis was on wa e . The la e is indeed an essen ial
elemen o li e, di ec ly as po able wa e , o indi ec ly, as a c ucial inpu o ood p oduc ion.
Wa e is also widely used in ene gy p oduc ion ( om hyd oelec ici y o he p oduc ion o shale
gas), and, in mining and indus y. Clima e change and he wa e cycle a e also closely
in e ela ed, wi h complex di ec and eedback in e ac ions. In elligence analyses (such as he
s udy o he US O ice o he Di ec o o Na ional In elligence, ODNI, 2012) en ision wa e
sca ci y as a majo sou ce o con lic and u moil in di e en de eloping egions, wi h e y
nega i e global epe cussions (wa , o ced mig a ions, ailed s a es, and e o is h ea s). The
epo conside s ha his is al eady happening in se e al a eas o Middle Eas , he Ho n o
A ica and o he pa s o Sub Saha an A ica, and, less acu ely, in o he egions o he wo ld,
including Cen al Ame ica and Hai i. Floods a e also leading o majo disas e s wi h human and
p ope y losses. The ODNI epo sugges s ha he window o oppo uni y o add ess hese
issues be o e hey ge ou o con ol is no mo e han a decade o so.
Mo e gene ally, all he p oblems discussed a e pa o he mo e complex in e ac ion be ween
ag icul u e, clima e change, po e y, ood secu i y, and en i onmen al sus ainabili y, wi h
mul iple ecip ocal ela ionships among all hese aspec s. On he one hand, clima e change
a ec s he a ailabili y o wa e , p omo es he de elopmen o mo e pes s and diseases, and is
gene a ing ex eme e en s (d ough s, loods, hu icanes) wi h nega i e impac s on u al
popula ions, especially he poo es and mos ulne able, and on ood secu i y. On he o he
hand, ag icul u e and ela ed p ac ices, such as de o es a ion, gene a e a signi ican pe cen age
o global g eenhouse gas (GHG) emissions. The e o e, hese p oblems need o be add essed
wi h a comp ehensi e ision, which includes no only soils, land, and wa e , bu also o he
aspec s o he wide con ex o he bio-economy and ecosys ems.
On he posi i e side, he e is an inc easing s ock o knowledge abou bes managemen p ac ices
and echnologies ha ha e p o ed o ha e he iple impac o imp o ing p oduc i i y and
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income o p oduce s, acili a ing adap a ion o clima e change, and educing GHG emissions.3
While science has been making p og ess in unde s anding wha can and should be done, much
mo e is needed in e ms o de eloping and adap ing echnologies o he Ea h’s a ied
ag oecological egions.
The con inuous gene a ion and adap a ion o he needed echnologies equi e ein o cing
na ional and in e na ional sys ems ela ed o esea ch, de elopmen and inno a ion (R&D&I).
While he p i a e sec o con inues o in es in new ag icul u al echnologies, many o he
mul iple-win inno a ions equi ed ha e cha ac e is ics mo e ela ed o public goods and equi e
a s ong and con inuous in ol emen by na ional and in e na ional public ins i u ions.
Na ional esea ch ins i u es wo king on he echnological aspec s o he challenges iden i ied
abo e, would bene i om inc eased le els o unding o ag icul u al R&D&I. Table 1 shows
he numbe o de eloping coun ies di ided in o hose spending mo e o 2%; hose be ween 1%
and 2%; and hose below 1%.
Mo e han h ee ou hs o he de eloping coun ies in he sample spend less han 1% o hei
ag icul u al alue added (a e age 0.5% and median 0.4%). De eloping coun ies should y o
in es a leas 1% o hei ag icul u al GDP in ag icul u al R&D&I, and, e en be e , y o
achie e 2%.
A he in e na ional le el i seems impo an o main ain and inc ease he le els o inancial
suppo o public global ins i u ions such as he Consul a i e G oup on In e na ional
Ag icul u al Resea ch (CGIAR) sys em (see Box), in o de o expand he wo k on echnologies
ela ed o ehabili a ion o deg aded land, small i iga ion p ojec s, and o he CSA/CFSA
p ac ices, and o s eng hen he in eg a ion o he in e na ional wo k wi h na ional sys ems.
TABLE 1. Spending on Ag icul u al R&D (as a sha e o Ag icul u al GDP, %)
Numbe o Coun ies
A e age
Median
Abo e 2%
9
4.4
3.1
Mo e han 1% and less 2%
11
1.3
1.3
Less han 1%
68
0.5
0.4
Sou ce: au ho calcula ions om ASTI/ IFPRI da abase.
_________________________
3 See o example, he 2016 annual epo o he p og am Clima e Change, Ag icul u e, and Food Secu i y (CCAFS,
h ps://cgspace.cgia .o g/ es /bi s eams/118452/ e ie e) which includes all he Cen e s o he CGIAR, and i is led by he Cen o
In e nacional de Ag icul u a T opical (CIAT), along wi h IFPRI and o he in e na ional cen e s and pa ne o ganiza ions (see
www.cca s.cgia .o g).

Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
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Food Sys ems
Howe e , achie ing a "sus ainable ood u u e" equi es no only he de elopmen and
u iliza ion o app op ia e echnologies and inno a ions. Food sys ems include a a ie y o
componen s ha need o be conside ed. Figu e 1 shows he complexi y o ood sys ems wi h a
ocus on nu i ion, in which he p ima y ag icul u al componen is only one aspec o he whole
sys em. The analysis o he implica ions o po e y alle ia ion, employmen , en i onmen al
sus ainabili y and heal h equi es he conside a ion o he whole alue chain, plus di e en
componen s o he consume en i onmen and consume ’s beha io .
In ac achie ing a “sus ainable ood u u e” implies eaching a a ie y o Sus ainable
De elopmen Goals (SDGs): o example educing po e y (SDG 1); elimina ing malnu i ion
and imp o ing ag icul u al p oduc i i y (SDG 2); leading o be e heal h (SDG 3); acili a ing
gende equali y (SDG 5); educing inequali y in gene al (SDG 10); p omo ing sus ainable
p oduc ion and consump ion sys ems (SDG 12); helping wi h he mi iga ion o clima e change
(SDG 13); ensu ing he sus ainabili y o ishe ies (SDG 14); and managing o es s sus ainably,
comba ing dese i ica ion and land deg ada ion and p o ec ing biodi e si y (SDG 15), among
o he hings.
BOX: The CGIAR Sys em
The CGIAR is he main in e na ional o ganiza ion wo king on hese opics in a a ie y o con inen s
and coun ies in close collabo a ion wi h hund eds o pa ne s, including go e nmen s, na ional and
egional esea ch agencies, ci il socie y o ganiza ions, academia, de elopmen o ganiza ions, and he
p i a e sec o . I includes 15 cen e s: A icaRice, Bio e si y In e na ional, Cen e o In e na ional
Fo es y Resea ch (CIFOR), In e na ional Cen e o Ag icul u al Resea ch in he D y A eas
(ICARDA), In e na ional Cen e o T opical Ag icul u e (CIAT), In e na ional C ops Resea ch
Ins i u e o he Semi-A id T opics (ICRISAT), In e na ional Food Policy Resea ch Ins i u e (IFPRI),
In e na ional Ins i u e o T opical Ag icul u e (IITA), In e na ional Li es ock Resea ch Ins i u e
(ILRI), In e na ional Maize and Whea Imp o emen Cen e (CIMMYT), In e na ional Po a o Cen e
(CIP), In e na ional Rice Resea ch Ins i u e (IRRI), In e na ional Wa e Managemen Ins i u e
(IWMI), Wo ld Ag o o es y Cen e (ICRAF), and Wo ldFish.
All 15 Resea ch Cen e s a e independen , non-p o i , in e na ional o ganiza ions, employing mo e
han 8,000 scien is s, esea che s, echnicians, and suppo s a wo ldwide, which a e ec ui ed om
a ound he wo ld. The wo k o he CGIAR is o ganized in o hema ic p og ams ha le e age he
knowledge o a la ge numbe o pa ne ins i u ions in de eloping and de eloped coun ies. The
CGIAR In eg a ed Resea ch P og ams include: P og am on Clima e Change, Ag icul u e and Food
Secu i y; P og am on Fo es s, T ees and Ag o o es y; P og am on Wa e , Land and Ecosys ems;
P og am on In eg a ed Sys ems o he Humid T opics; P og am on Aqua ic Ag icul u al Sys ems;
P og am on D yland Sys ems; P og am on Policies, Ins i u ions, and Ma ke s; P og am on
Ag icul u e o Nu i ion and Heal h; P og am on D yland Ce eals; P og am on G ain Legumes;
P og am on Li es ock and Fish; P og am on Maize; P og am on Rice; P og am on Roo s, Tube s and
Bananas; P og am on Whea ; and P og am o Managing and Sus aining C op Collec ions. These
ins i u es ha e a long and ecognized ack eco d o wo king a ound he wo ld ocusing on he
analysis o policies, in es men s, ins i u ions and app op ia e echnologies and p ac ices wi h he aim
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
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FIGURE 1. Food Sys ems, Die s and Nu i ion.
Building ag o- ood sys ems ha deli e hese esul s equi es many poli ical, ins i u ional,
echnological and in es men e o s and inno a ions. This a icle conside s only some aspec s
o ha gene al challenge, ocusing on he mobiliza ion o inancial esou ces o build a
“sus ainable ood u u e,” and, in pa icula , o suppo in es men s in CSA/CFSA by small and
amily a ms a he scale needed o ha e some signi ican global impac .
Al hough jus a componen o he whole ood sys em his mo e limi ed ocus is s ill impo an .
O he some 500–600 million a ms ha ope a e a he wo ld le el, abou 90 pe cen can be
conside ed amily a ms ha con ol abou 70 pe cen o he wo ld’s land4 (Lowde , Skoe , and
Singh, 2014). P ima y ag icul u e alone employs almos 1 billion people (while he ag icul u al-
based ood and non- ood sys ems in hei en i e y, including a a ie y o small, mid-sized and
la ge en e p ises ela ed o ag i- ood in inpu s, equipmen , p ocessing, anspo a ion, and e ail,
may employ nea ly 1.8 billion people, o hal o wo ldwide employmen ) (Díaz-Bonilla and
Callaway, o hcoming). A he same ime, he wo ld ood sys em ( om ag icul u al p oduc ion
and land use changes o all p ocessing, anspo a ion, e ail, and consump ion ac i i ies) is
es ima ed o gene a e some 30 pe cen o global g eenhouse gas (GHG) emissions (Ve meulen,
Campbell, and Ing am 2012), wi h some 2/3 o ha o al coming om ag icul u e, o es y, and
o he land use (conside ing emissions minus o se s, acco ding o EPA in
h ps://www.epa.go /ghgemissions/global-g eenhouse-gas-emissions-da a).
Al hough, as no ed, many policy, ins i u ional, echnological, and in es men inno a ions will
be needed a he global, na ional, and local le els o build mo e dynamic, equi able, nu i ion-
_________________________
4 The au ho s conside by amily a ms mos o he wo ld’s smalle and medium-sized a ms, bu hey include some la ge a ms as
well o he ex en ha hey a e ope a ed by indi idual amilies and no co po a ions. Non- amily (o co po a e) a ms a e, on
a e age, la ge han amily a ms, ep esen ing abou 10 pe cen o he wo ld’s a ms and occupying 30 pe cen o he wo ld’s
a mland (Lowde , Skoe , and Singh, 2014).
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
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o ien ed and sus ainable ag i- ood sys ems, he e he ocus is on some speci ic policies ela ed o
mobilizing inancial esou ces, which a e likely o equi e collec i e ac ion on behal o G20
coun ies h ough he app op ia e wo king g oups (see also Díaz-Bonilla and Callaway,
o hcoming).
ESTIMATED COSTS
Focusing only on i iga ion, a s udy by IFPRI (Ringle , 2017) has es ima ed ha o mee he
expec ed expansion o ood demand by 2030, abou 7.9 billion dolla s o annual in es men s
will be needed in de eloping coun ies o expand i iga ion and o he sys ems, and an addi ional
2.4 billion dolla s would be needed annually o make cu en sys ems mo e e icien . The IFPRI
epo highligh s ha sub-Saha an A ica and La in Ame ica and he Ca ibbean (LAC) a e he
egions wi h he g ea es oppo uni ies o in es in expanding and imp o ing i iga ion
p oduc i i y.
A ecen s udy by IFPRI and he Uni e si y o Bonn Cen e o De elopmen Resea ch (ZEF)
(Nkonya, Mi zabae and on B aun (eds.), 2016), has es ima ed ha he annual cos o land
deg ada ion due o “land use and co e change” (LUCC) and he use o land-deg ading
managemen p ac ices on s a ic c op and g azing land is abou 300 billion dolla s (no including
all cos s ela ed o de e io a ion o all ecosys em se ices, which may inc ease he es ima es
signi ican ly; see o ins ance ELD Ini ia i e, 2015). The au ho s es ima e ha he cos o
comple ely ehabili a ing lands deg aded due o LUCC wo ldwide would be abou 4.6 illion
dolla s o e 6 yea s,—and i ac ion is no aken o ehabili a e deg aded lands du ing his same
pe iod, he wo ld will incu a loss o 14 illion dolla s, which sugges s ha such in es men s
ha e a e y posi i e e u n.
Conside ing o he CSA in e en ions, he in es men equi emen s a e signi ican ly highe (see
o ins ance he Wo ld Bank’s s udy by Sadle e al, 2016).
Mo e gene ally, ypical es ima es o he cos s o achie e he Sus ainable De elopmen Goals
(SDGs) needed o build ood sys ems ha deli e g ow h and employmen , social inclusi eness,
clima e esilience, en i onmen al sus ainabili y, and heal hy die s o all, all in he ange o
1.5–2.5 illion dolla s pe yea o addi ional in es men s in de eloping coun ies (Schmid -
T aub. 2015). E en ecognizing he me hodological limi a ions o hese ypes o es ima es
(De a ajan, 2015), aking he possible in e en ions and in es men s o scale and achie ing
signi ican impac s globally equi es a non- i ial e o o mobilize he public and p i a e
esou ces needed.
OPTIONS FOR FINANCING THE ACTIVITIES AND INVESTMENTS
NEEDED
How can he wo ld inance hese in es men s and ac i i ies? The e a e se e al op ions,
including adi ional bila e al de elopmen assis ance; mul ila e al lending; public budge s in
de eloping coun ies (including be e con ols on co up ion, illegal inancial lows, and ax
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
8
e asion o expand iscal esou ces); domes ic banking sys ems; uncon en ional mone a y
policies; and inally, p i a e inancial ma ke s, including impac in es o s and socially o ien ed
in es o s. This pape b ie ly discusses some o hem, and hen de elops u he he las op ion
(as discussed in Díaz-Bonilla, Ve cho , Lobogue e o, Viglizzo and Mi zabae , 2018).
Bila e al aid o de elopmen and de elopmen banks
A p esen , he bila e al de elopmen aid adi ionally p o ided by he iches coun ies is
limi ed by budge a y and poli ical easons. In nominal e ms, i eached a maximum o close o
150 billion dolla s (cons an US dolla s o 2010) in 2014 and dec eased o somewha mo e han
140 billion dolla s in 2015 and 2016 (es ima ed by he au ho om Wo ld De elopmen
Indica o s/Wo ld Bank, 2018). Figu e 2 shows ha aid o e ime, as a pe cen age o wo ld GDP
(le axis om he eade ) and GDP o de eloping coun ies ( igh axis).
Ne de elopmen assis ance and o icial aid has allen om a ound 0.35% o he wo ld GDP and
1.5% o he GDP o he de eloping coun ies in he 1960s, o 0.2% and 0.6%, espec i ely, a
p esen .
Non-concessional loans (i.e. hose ha do no ha e highly subsidized in e es a es and e y
long e ms), which a e he majo i y o Wo ld Bank and Regional Bank loans o middle-income
FIGURE 2
Sou ce: Au ho calcula ions om Wo ld De elopmen Indica o s, Wo ld Bank
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
2
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0.4
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
Ne De elopmen Assis ance and O icial Aid
(% o GDP)
% Wo ld GDP % De eloping GDP
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
15
and d) p o ide he suppo o he moni o ing and e alua ion ac i i ies ela ed o ha pipeline o
p ojec s.
The p epa a ion o hose p ojec s equi es mul idisciplina y wo k o unde s and, among o he
hings, he ma ke condi ions and he ope a ion o alue chains in which p oduce s a e, o can
be, inse ed; he echnological and ope a ional challenges o he p ojec s; he legal and
egula o y aspec s; he cons ain s and possibili ies o he pa icipa ing p oduce s and
communi ies; he en i onmen al, na u al esou ce, and clima e challenges; he objec i es and
incen i es o po en ial in es o s, and hei isk/ ewa d expec a ions; and he egula o y,
ins i u ional and poli ical amewo k wi hin which speci ic p ojec s ha e o ope a e.
The size o he PPSF depends on he ambi ion o scale up in es men s a he global le el.
Assuming a cos o p epa a ion pe p ojec o be ween 2–4% o he o al p ojec cos s, hen a
PPSF o 100 million dolla s, could help mobilize in es men s o abou 2,500–5,000 million
dolla s. The PPSF can be s uc u ed as a e ol ing acili y whe e he p epa a ion cos s a e
eimbu sed o he PPSF, by he app op ia e p i a e and/o public pa ne , upon he
implemen a ion o he p ojec .13 Wi h his mechanism, he PPSF can end up mobilizing unds
o speci ic in es men s ha will be a la ge mul iple o he alues men ioned abo e.
A possibili y is ha he PPSF be ope a ed by he CGIAR sys em and FAO, combining he
s eng hs o bo h in e na ional o ganiza ions o p o ide he economic, inancial, echnological,
and social analy ical capabili ies o suppo coun ies and local communi ies o p epa e hose
p ojec s and es ablish he needed inancial s uc u es, and adequa ely se e as nexus wi h public
and p i a e in es o s. In pa icula , he PPSF should help apply he la ge pool o CGIAR’s
echnical expe ise also o he p epa a ion and s uc u ing o scalable in es men p ojec s in
de eloping coun ies.
CONCLUSION
Achie ing a “sus ainable ood u u e” equi es building ood sys ems ha , in line wi h he
ela ed Sus ainable De elopmen Goals (SDGs), suppo g ow h and employmen , ensu e social
inclusi eness and equi y, p omo e clima e esilience and en i onmen al sus ainabili y, p o ec
biodi e si y, and gene a e heal hy die s o all. Many policy, ins i u ional, echnological and
in es men inno a ions a e needed o build such ood sys ems. This b ie conside s as a
necessa y ounda ion he de elopmen o adequa e echnologies and inno a ions, and an
adequa e in es men clima e.
The challenges a e signi ican and add essing hem will equi e he mobiliza ion o unds a he
equi ed scale, pa icula ly om he p i a e sec o . This pape has discussed se e al op ions o
he G20 o pu sue. Fi s , he G20 could encou age public expendi u e e iews ocused on
sus ainable ood and ag icul u al sys ems (o he ela ed SDGs) o ealign p io i ies and
spending in de eloping coun ies, bu also in de eloped ones. A second ecommenda ion o
_________________________
13 The Camdessus Repo sugges s a simila mechanism: he epo calls o he c ea ion o “a Re ol ing Fund o unds consis ing
o g an money o inance he p epa a ion and s uc u ing cos s o complex p ojec s.” (p.22)

Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
16
de eloping coun ies should be o e iew u al inancial ma ke s and inancing o alue chains
in o de o emo e some o he obs acles impeding he unding o he equi ed ood sys em
ans o ma ions. This would en ail expanding he wo k o he Global Pa ne ship o Financial
Inclusion o include a mo e comp ehensi e iew o he mac oeconomic, egula o y, ins i u ional
and ope a ional opics in ol ed. Toge he he public sec o and he banking sys em ep esen he
la ges sou ce o money a ailable o inancing hese in es men s. Finally, a hi d ac ion i em
could be he c ea ion o a P ojec P epa a ion and Suppo Facili y o de elop a pipeline o
p ojec s ha scale up he use o clima e-sma ag icul u al echnologies among small and amily
a ms. The cu in global GHG emissions needed o main ain he wo ld wi hin sa e le els while
ensu ing he addi ional p oduc ion equi ed by a la ge , weal hie popula ion, will no be
achie ed wi hou a signi ican con ibu ion om ag icul u e. This p oposal implies a modes
alloca ion o public unds ha can be le e aged o mobilize a much la ge pool o p i a e
inancial unds, which may be in e es ed in scaling up inno a i e p oduc i e p ac ices and
echnologies ha ha e he iple impac o imp o ing p oduc i i y and incomes o p oduce s,
acili a ing adap a ion o clima e change, and educing GHG emissions. I is no an exagge a ion
o a gue ha he u u e o humankind depends on how we add ess he challenges discussed he e,
o e ing p ac ical answe s ha achie e signi ican impac s globally.
Economics Discussion Pape (2018–73)—submi ed o Global Solu ions Pape s
17
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