New FAO publication sheds light on climate finance trends in the agriculture and land use sector

Climate change greatly affects the agriculture and land use sector, and its impacts result in disruptions to national economies and to the vitality of rural livelihoods, ecosystems, and biodiversity. In our interconnected world this constitutes a particular threat to food security and nutrition on a global scale.

At the same time, the agriculture and land-use sector is a major contributor to global greenhouse gas emissions. Global development finance plays a crucial role in fostering agriculture to mitigate and adapt to climate change, and it is a driving force in the achievement of the Paris Agreement on climate change goals, the Sustainable Development Goals, and Agenda 2030.

To address the knowledge gaps and develop a better understanding of how climate finance in the agriculture and land use sector has evolved over the past two decades, the Food and Agriculture Organization of the United Nations (FAO) Office of Climate Change, Biodiversity and Environment (OCB) together with the Resource Mobilization and Private Sector Partnership Division (PSR) recently released a study that looks  at the main features of climate finance, including the source and geographical destination of resources, climate objectives and gender sensitivity.

The report, titled Climate finance in the agriculture and land use sector – global and regional trends between 2000 and 2018 provides insights for UN agencies, international finance institutions, and governmental and non-governmental stakeholders.

“The report is timely, it will support government officials representing their countries in the upcoming COP26, where we expect it to contribute to climate finance discussions in the agriculture and land use sector”

Eduardo Mansur, Director, Office of Climate Change, Biodiversity and Environment, FAO

Key findings and trends identified in the report

Findings from the analysis show that between 2000 and 2018 the share of global climate finance in the agriculture and land use sector has decreased, passing from an average of 45 percent of the total flows at the beginning of the millennium, to 24 percent in 2013 where it has since remained. The total sum of contributions to the agriculture and land use sector between 2000 and 2018 amounted to USD 122 billion, representing 26 percent of the global climate finance flows to all sectors.

Most contributions to climate-related activities in the agriculture and land use sector are provided by OECD Development Assistance Committee members (78 percent), followed by multilateral development banks (18 percent) and other multilateral actors (7 percent).

When looking at region-specific climate finance allocations in the agriculture and land use sector, the principal recipients in the assessed period were countries in Africa and Asia, attracting 30 percent and 32 percent of flows respectively.

For all regions, 2010 marked the first year of reported allocations to climate change adaptation in the agriculture and land use sector. There was an overall decrease in allocations to mitigation in the agriculture and land use sector, and strong preference to allocate to projects with a cross-cutting objective.

In the assessed period 2000-2018, climate finance within the agriculture and land use sector, saw agriculture development and environment and biodiversity as the two largest funded sub-sectors in all regions. The forestry sub-sector received climate finance in all the regions, with particularly large shares in Asia, Africa and America, and Global and Interregional projects. The shares of allocations to crop production, livestock and fisheries sub-sectors were relatively low across the regions.

“FAO fully supports the recommendations of the report, and will continue assisting countries to strategically engage with the complex and evolving global climate finance landscape.  We need to keep in mind the need to increase access to range of resources, as well as continue to improve climate finance tracking and the methodological framework for measuring and monitoring the impact of climate finance."