Commitments to action

Coalition of Action for Inclusive and Sustainable Food System Finance – The Public Development Banks (PDB) initiative

International Fund for Agricultural Development, IFAD, AFD, France, CDP, Italy

Catalytic investments in agriculture and the food economy are critical to realizing the 2030 Agenda and Paris Agreement on CC. Finance is recognized as a cross-cutting enabler of all the ATs of the 2021 FSS. Given PDB’s role in the UN Financing for Development process and countercyclical mandate, PDBs have a critical role to play in increasing and redirecting financial flows towards more sustainable and inclusive outcomes, including finance for smallholder farmers and agri-SMEs, and gender-inclusive finance.
In order to build a broader, more inclusive, and sustainable financial ecosystem for food systems transformation, we need to go beyond finance, which requires enabling policies and regulations allowing, for example, PDBs to take risks according to their mandate. Public and private sector actors need to come together to support development objectives at the country level, and a strong connection to research institutions and the development of evidence from the ground is also needed. CSOs should be actively involved to ensure accountability and monitoring of results. On the demand side, the private sector, SMEs, and other rural institutions can inform the changes that are needed for ecosystem effect.

This Coalition builds and expands on these efforts to develop a more robust ‘platform’ of PDBs to channel existing and additional investments from all sources for more sustainable, inclusive food systems outcomes, with a focus on ensuring small-scale producers are not left behind, as well as interfacing with this platform in the coming months and years to come to make sure that its effects are as transformative, actionable and impactful as possible.

The Platform will provide a space to build partnerships, help to share knowledge and accelerate learning among the PDBs, supporting them to increase their participation in inclusive and sustainable rural finance, namely three self-reinforcing pillars: (i) TA pillar designed to help banks build their capacity to effectively tackle their key operational and governance challenges, including better assessment and monitoring of risks and development impacts, by matching TA needs with providers, leveraging instruments such as SSTC; (ii) Communication and Learning pillar to effectively spread best practices between the PDBs, ensuring that the planned increased volume of rural financing by PDBs is targeted to better projects using sustainable banking methodologies and (iii) Leveraging PDB agricultural Financing pillar, to support – based on demand – the participating PDBs design their rural outreach strategies, obtain advise or how to optimize balance sheet resources for greater lending to agriculture.

Constituency

Member state(s)
Other

Action Area(s)

Means of Implementation

Location

Global

Key contact

Christian Fusillier, International Fund for Agricultural Development
[email protected]

Keywords

Public development banks
Green and inclusive investments
Sustainable finance

Downloads

NA

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