Maximizing finance for development, new World Bank report
The Sustainable Development Goals (SDGs) – from ending poverty and hunger by 2030 to protecting the planet’s resources for future generations – are ambitious, calling for innovative solutions and massive annual increases in public and private investment.
With more than three-quarters of the world’s poor living in rural areas and relying on agriculture for their livelihoods, improving the performance of agricultural value chains is crucial to meeting these goals.
Future of food: maximizing finance for development in agricultural value chains – a new report by the World Bank Group – looks at how to crowd-in more private investment to help achieve the SDGs while also improving the use of scarce public resources, promoting good governance and ensuring environmental and social sustainability.
The report identifies financing gaps as well as an ever-expanding source of private investors who can help fill those gaps, including farmers, the largest share of private investors in agriculture.
It also argues for the need to understand market failures that lead to inadequate levels of privately provided goods and services.
Public investment – for agricultural research, large-scale public infrastructure, etc. – also plays a crucial role in crowding-in private sector investment by improving incentives and reducing transaction costs.
The report details actions for maximizing finance for development – from promoting responsible food and agriculture investments to increasing the space for private sector activity to improving the policy and regulatory environment for private sector investment.
It recommends an approach to diagnostics that is more private-sector oriented as well as inclusive public-private dialogue to inform a reform and investment agenda that ensures impact.
And because agriculture relies on other sectors, such as water and energy, it advocates coordination and cooperation across ministries and agencies.
Read more about how innovative financing, included blended finance and social impact investing, is changing the landscape.