The state of food security and nutrition in the world described in this report presents a concerning picture but also provides ample cause for hope. While global levels of hunger and food insecurity have essentially not changed for two years, there has been encouraging progress in many subregions of the world. With respect to nutrition, the rising trends in adult obesity and anaemia among women aged 15 to 49 years are worrying, yet in many countries, fewer children are affected by stunting and wasting, increasing their chances of achieving their full potential for growth and development. The global prevalence of child stunting has declined by one-third in the last two decades, showing that positive change is possible and is happening at scale across countries and regions. This is the potential we need to harness: the potential for positive change and the full realization of the right to adequate food and a standard of living that guarantees the dignity, health and well-being of all people, especially future generations.
This report once again reminds us that real transformative change is the only way to get the world back on track, moving in the right direction towards meeting the Sustainable Development Goal (SDG) Targets 2.1 and 2.2 of ending hunger, food insecurity and malnutrition in all its forms by 2030.
In many low- and middle-income countries in particular, conflicts, climate variability and extremes, and economic slowdowns and downturns continue to occur more frequently and often together. Hunger is higher and has increased the most in countries affected by the major drivers, and hunger increases are higher in poor countries affected by more than one major driver. Because agrifood systems in these countries are not resilient to these external forces, hunger, food insecurity and malnutrition are still on the rise and disproportionately affect children. Moreover, underlying structural factors such as lack of access to and unaffordability of nutritious foods, unhealthy food environments, and high and persistent inequality further worsen the negative effects of the external drivers on food security and nutrition.
Business as usual is not an option in the face of the major drivers of food insecurity and malnutrition, and their growing occurrence and intensity. Past editions of this report have clearly laid out what must be done. Different policies, interventions and investments as well as legislation changes are proven to work in diverse contexts and in different combinations; however, there seems to be a binding financing constraint to implement them at scale and with better targeting. Paradoxically, pinpointing the financing gap to support efforts towards meeting SDG Targets 2.1 and 2.2 is a daunting task since there is no coherent picture of the financing flows available for, and being spent on, food security and nutrition.
A serious problem is the lack of a common definition or standard for measuring financing for food security and nutrition. It is hard – if not impossible – to manage what cannot be adequately measured. In the case of financing for food security and nutrition, it is not possible to adequately assess the existing levels and gaps, let alone monitor progress or setbacks in financing efforts to meet SDG Targets 2.1 and 2.2. This predicament poses a multitude of problems, including identifying underfinanced areas, ensuring accountability of institutions, and tracking the effectiveness and impact of the interventions financed, among others. Hence, the urgent need to move towards a common definition of, and measurement guidelines for, financing for food security and nutrition has been timely noted and addressed in this edition of the report.
This report has taken an important step forward by advancing a definition of financing for food security and nutrition together with detailed guidance to implement it. While this step is very important, the report has also starkly shown that the current structure and availability of financial data impede the application of the newly proposed definition to the public and private financing flows globally available for food security and nutrition. In other words, due to serious data constraints, it is not possible to arrive at the global measurement of the financing for food security and nutrition that is currently available and of the financing gap that must be bridged to support efforts towards meeting SDG Targets 2.1 and 2.2.
At best, it is possible to know that not even one-quarter of all international development funding flows go to food security and nutrition, and this share is not growing. Flows broadly appear to target well those countries where hunger, food insecurity and malnutrition are higher, and they mostly support food consumption and health. However, relatively fewer flows go to addressing the major drivers of food insecurity and malnutrition, namely conflict, climate variability and extremes, and economic slowdowns and downturns, and their underlying structural factors, lack of access to and unaffordability of nutritious foods, unhealthy food environments, and high and persistent inequality.
Assessing public domestic financing for food security and nutrition is problematic as there is no global financial database with sufficient data for the analysis. Public spending on agriculture is available globally, but this accounts for only a fraction, and sometimes a very small one, of all the public spending on food security and nutrition. There are not readily available data for all the countries in the world to estimate the public spending that is supporting food security and nutrition. An analysis of ten low- and middle-income countries shows that public spending on food security and nutrition was growing before the COVID-19 pandemic, with support to food consumption taking the greatest share, but this trend could not be sustained in some countries. Governments in some middle-income countries also seem to be spending relatively larger shares of their budget on addressing the major drivers of food insecurity and malnutrition compared to low-income countries.
Private financing, both domestic and foreign, is thought to represent the largest financing flow to agrifood systems and sectors that impact food security and nutrition, yet it is impossible to properly verify and account for this flow due to missing information. Philanthropic flows to food security and nutrition are not large; cross-border remittances are much larger, but they support food security and nutrition mostly through food consumption rather than investments in agrifood systems. Among international commercial private financing flows, foreign direct investment is the flow type with the most comprehensive data source. However, there cannot be a full accounting of private financing, since, as this report has shown, comprehensive and relevant numbers on market finance (i.e. issuance of stocks and corporate bonds), international bank loans and domestic private equity are extremely difficult to obtain. Furthermore, where there is access to these sources of private financing, their contribution to food security and nutrition cannot be taken for granted, as many of the investments being financed – particularly those by large international food and beverage companies – may not always help reduce hunger, food insecurity and malnutrition. The main source of funding for companies in sectors relevant to food security and nutrition, at least for farmers and small and medium enterprises, appears to be self-funding, on which no data exist.
Against such a backdrop, this report lays bare the dismal state of the availability, accessibility and adequacy of financing flows data that would allow a proper assessment of financing for food security and nutrition. Addressing this gap must be a top priority, and this report sends a strong and urgent call for global and national actions to address this problem as part of the SDG global agenda for action. This call falls squarely within the purview of SDG 17 – Strengthen the means of implementation and revitalize the Global Partnership for Sustainable Development. Finance and financial inclusion are among the key means of implementation in SDG 17, therefore this report’s call to address the financing data gap must be prioritized as a key action to be taken immediately.
Of course, beyond the data gap there is an important financing gap to bridge. While this report has demonstrated that it is not possible to fully apply the newly proposed definition of financing for food security and nutrition to all relevant financing flows available due to data constraints, existing model-based scenarios suggest that different policies and interventions to reach SDG Targets 2.1 and 2.2 bear a cost in the trillions of USD. No matter the estimate, more financing for food security and nutrition is needed, particularly in countries with the greatest needs. Moreover, there needs to be a serious rethinking of how existing financing is being allocated because in several instances the current financing is not cost effective, and this is resulting in lost opportunities to reduce hunger, food insecurity and all forms of malnutrition much faster. There are also inequalities in the access to financing for food security and nutrition both between countries and within countries. Such inequalities are further exacerbated within countries by a lack of inclusive and gender-sensitive financing.
Countries that have the greatest need for financing are those that struggle the most to actually access financing. Around 63 percent of the countries with high and/or increasing hunger, food insecurity and malnutrition struggle to access financing for food security and nutrition and have limited or moderate ability to access financing. Most of these countries (82 percent) are affected by one or more of the major drivers of food insecurity and malnutrition. This is quite at odds with the fact that very few of the international official development flows going to these countries are directed towards addressing these drivers. Scaling up financing towards countries with the highest levels of hunger, food insecurity and malnutrition and those most affected by the major drivers is essential.
Countries facing limited ability to access financing also have high levels of sovereign debt and must spend important amounts of public revenues on servicing debt. Multilateral development banks (MDBs), development finance institutions (DFIs), international financial institutions (IFIs) and all international lenders in general need to support these countries so that, through debt swaps and debt relief measures, their governments can reallocate resources towards food security and nutrition. In countries with more moderate ability to access financing, utilization of concessional finance and commerce-oriented instruments following a blended finance approach will still be essential for de-risking investments and providing the right incentives for private actors to participate in these markets. However, while moving towards lower levels of risk, it is expected that public and private actors can progressively increase their engagement, making financing more widely available.
Official and public sources of financing alone will not be sufficient to fill the financing gap to end hunger, food insecurity and malnutrition. Scaling up private financing, including through private–public partnerships, will also be essential to supplement the efforts for meeting SDG Targets 2.1 and 2.2. Economic development is essential for the private sector, but it is difficult to achieve and sustain where large segments of the population are unproductive and unhealthy due to hunger, food insecurity and malnutrition.
The current financing architecture for food security and nutrition makes the scale-up and effective implementation of financing for food security and nutrition unfeasible. It is highly fragmented, exhibits a lack of consensus about the priorities, and is characterized by an over-proliferation of actors delivering mostly small, short-term projects. Donors, MDBs, DFIs, IFIs and philanthropic foundations have increased in number, but this has created further coordination challenges, both among actors and with recipient countries, whose political and financial priorities are not always considered. Therefore, more can be achieved in scaling up financing for food security and nutrition if there is better alignment and synergy among the different sources of financing.
Ending hunger, food insecurity and all forms of malnutrition is also unnecessarily in competition with many other development objectives. Considering the complex and multisectoral nature of food security and nutrition, the financial landscape must shift from a siloed approach towards a more holistic perspective, in which financial stakeholders can streamline food security and nutrition objectives into broader financing flows and investments. A starting point is breaking the sectoral silos within food security and nutrition, from complementary but separate “food security” and “nutrition” objectives towards a single “food and nutrition security” policy goal. Embracing this new narrative can be catalytic in recognizing the interconnected dependency of both – one without the other prevents the achievement of either. A new narrative for financing for food security and nutrition across sectors and financial stakeholders can help lead to a new finance governance that promotes the complementarity of the different financing flows towards food security and nutrition. For example, a closer nexus between humanitarian, climate and development finance must be promoted, as these are essential for meeting SDG Targets 2.1 and 2.2. This requires improving the transparency of the international financing for food security and nutrition to enhance coordination and efficiency among the different stakeholders.
This report has also warned that the challenges relate not only to mobilizing more resources, but also to using existing financing more effectively. Executing more effectively available national budgets for food security and nutrition; repurposing existing public support to enable more resilient, sustainable and equitable agrifood systems; and optimizing national budgets allocated to the food and agriculture sector will allow countries to achieve better food security and nutrition at no extra cost. However, this will only help reduce, but not fully fill the financing gap for food security and nutrition.
Estimating the financing gap for food security and nutrition is an unavoidable step going forward. Not bridging it by 2030 means millions of people will still be undernourished, millions will have been pushed into crisis or worse levels of acute food insecurity, and insufficient progress will have been made to meet all global nutrition targets. The resulting social, economic and environmental costs will be unmeasurable. There is no time to lose, as the cost of inaction greatly exceeds the cost of action this report calls for.
It is hoped that this report’s calls to action will inform the sustainable development and financing discussions at the Summit of the Future in September 2024 and all the upcoming SDG global discussions, including the political processes of the Fourth International Conference on Financing for Development in 2025. A world without hunger, food insecurity and malnutrition is a world worth saving, and a world worth financing and investing in.
