New York - The 2024 edition of the State of Food Security and Nutrition in the World (SOFI) report, to be officially launched on July 24, takes a deep dive into salient themes regarding financing for development, in particular financing for food security and nutrition to meet the targets of Sustainable Development Goal (SDG) 2, with the aim of creating better identifying opportunities, strengthening accountability and traceability, and ultimately improving financing productivity.
Some aspects and findings of the UN flagship report were highlighted today at the Special Event on Financing to End Hunger, Food Insecurity and Malnutrition in All its Forms, within the UN Economic and Social Council High-Level Political Forum in New York.
The report notes that definitions of financing for food security and nutrition, and the differences among them, lead to inconsistent estimates, causing issues in identifying underfinanced areas, ensuring accountability and tracking intervention impacts. Therefore, a common definition and mapping are urgently needed, as current efforts lack adequate attention and clarity.
Speaking through a video message, the Director-General of the Food and Agriculture Organization of the United Nations (FAO), QU Dongyu, noted that more, better-targeted and less risk-averse financing is needed to move the world closer to eradicating hunger.
Countries have not been able to mobilize sufficient resources to fund the necessary policies, programmes and interventions, the Director-General added.
Failing to bridge the financing gap will have consequences that will also cost several trillion US dollars. "Financing zero hunger today is investing in a better future tomorrow," he said. SOFI 2024 makes it clear that the countries with the most alarming levels of hunger tend to be those with the least access to financing, highlighting the need for innovative, inclusive and equitable solutions to scale up investments in those areas, Qu noted.
The current financing structure for food security and nutrition is ineffective due to its fragmentation, lack of consensus on priorities, and the prevalence of numerous actors delivering mostly small, short-term projects. Greater success in scaling up financing for these areas could be achieved through better alignment and synergy among different funding sources. Given the complex and multisectoral nature of food security and nutrition, the financial landscape must move away from a siloed approach towards a more holistic perspective. This would enable financial stakeholders to integrate food security and nutrition objectives into broader funding flows and investments, according to Maximo Torero Cullen, FAO Chief Economist, who previewed the SOFI report at the New York event.
Charting a stronger course
With the aim of galvanizing both more and better-used resources, the SOFI report unveils a new definition for measuring the amount of financial resources dedicated to food security and nutrition. It implies the existing landscape and replace a plethora of often misaligned concepts that at times lead to enormous discrepancies in measured financing flows and hinder optimal targeting capacities, as well as obfuscate the accountability and traceability required to gauge effectiveness of investments. It also better reflects our collective understanding of the current drivers of food insecurity and malnutrition in all its forms, and how addressing the problems of today and tomorrow, in a sustainable manner, requires going beyond the narrow lenses of agricultural production or food distribution.
The new definition refers to public and private financial resources, both domestic and foreign, that are targeted to ensure the availability, access, utilization and stability of nutritious and safe foods, and practices that favour healthy diets, as well as health, education and social protection services that enable these.
It includes financial resources that aim to strengthen the resilience of agrifood systems and address the major drivers jeopardizing the zero hunger goal, namely persistent inequality, the lack of access to and affordability of healthy diets, increasing conflict, climate trends and economic slowdowns., .
This approach reveals that most official development assistance helping countries address their food insecurity and malnutrition challenges is flowing to support food consumption while relatively less is allocated to address the major drivers of food insecurity and malnutrition, and even fewer to health status.
A case study presented in SOFI 2024 shows that governments in low-income countries have particularly low spending capacity to address hunger's major drivers of hunger, and only around a third of total official development assistance contributes directly or indirectly to this cause.
The report also offers a mapping approach for financial allocations that facilitate a shift away from the typical sector-defined boundaries of agriculture and basic nutrition towards addressing the multi-dimensional nature of food insecurity and malnutrition. Understanding the scale and shape of finance for development is imperative in order to assure its proper role as a means of implementation to delivering the agreed goals.
The aim is to capture the holistic scope of effective outcome-defined solutions. For example, expanding energy access in a rural area may improve agricultural productivity through access to electricity for irrigation and mechanized equipment, as well as facilities to store and clean food.
Likewise, providing community-based animal health services and livestock vaccinations can, as demonstrated in areas of conflict in South Sudan and Sudan, offer an effective entry point for re-establishing intercommunity dialogue, leading to local-level peace agreements that have a profound impact on the main pillars of food security.
While significant data gaps must be filled to apply it globally, the new definition can help not just to unleash new funding but to better use existing funding.
SOFI 2024 recommends that grants and concessional loans are the most suitable tool for countries with limited ability to access financial flows, while countries with moderate abilities can increase domestic tax revenues and link taxation to food security and nutrition outcomes. Countries with high ability to access financing can embed food security and nutrition objectives in green, social, and sustainability-linked bonds and similar instruments.
Three recommendations
In his remarks, FAO Director-General Qu proposed three major themes that can improve the productivity of development finance.
First, coordination and consensus - Qu insisted on the importance of better targeting for the people most in need.
Second, donors and other global partners should become more risk-tolerant and involved in de-risking activities. That, he noted, befits the nature of agrifood systems themselves, which operate under risk and uncertainties that are continuing to increase.
Lastly, more blended financing is needed, as the scope of the problem to be tackled goes beyond the public sector's capabilities. Collaborative partnerships keyed to a blended finance approach, today still a modest contributor to development finance, can reduce the financial risks that otherwise too often make access to resources too expensive.
"If we act upon these three calls, we will move closer to SDG2," the Director-General said.
The State of Food Security and Nutrition in the World is an annual flagship report by FAO, the International Fund for Agricultural Development (IFAD), the World Food Programme (WFP), the World Health Organization (WHO) and UNICEF. The report will be released on 24 July during the G20 Global Alliance against Hunger and Poverty Task Force Ministerial Meeting.
