The crucial role of finance resources for food security and nutrition

The annual flagship report entitled “The State of Food Security and Nutrition in the World 2024”, released in July 2024, jointly prepared by the Food and Agriculture Organization of the United Nations (FAO), the International Fund for Agricultural Development (IFAD), the United Nations Children’s Fund (UNICEF), the World Food Programme (WFP) and the World Health Organization (WHO), provides concerning findings on the financing constrains for food security and nutrition, suggests innovative financing tools to accelerate progress on Sustainable Development Goal (SDG) Targets 2.1 and SDG2.2 and guidance for its implementation.

“Estimating the gap in financing for food security and nutrition and mobilising innovative ways of financing to bridge it must be among our top priorities.” – FAO, 2024.

Alarmingly, the report demonstrates that despite progress made in the past, hunger and food insecurity have recently risen significantly putting the world far from achieving SDG Targets 2.1 (ending hunger and food insecurity) and 2.2 (eradicating all forms of malnutrition). According to the report “between 713 and 757 million people faced hunger in 2023”, highlighting the hazardous trajectory our agrifood systems are currently on.

To remediate this situation, the report focuses on the current levels and gaps in financing for food security and nutrition. Resource mobilisation is crucial to ensure all people have access to safe, nutritious, and sufficient food.

What is the status of financing for food security and nutrition, and what are the financial approaches to achieve food security and nutrition goals?

Overview of global food security and nutrition

Regardless of efforts in some areas, the world remains off-track in ending hunger and food insecurity and eradicating malnutrition in all its forms by 2030. Indeed, the report highlights that, in 2023, there were 152 more people facing hunger compared to 2019. In 2023, 2.33 billion people were moderately or severely food insecure including 864 million dealing with severe food insecurity posing grave risks to their health and well-being.

The report pinpoints economic downturns, inflation, income inequality, ongoing conflicts, political instability and climate change as factors responsible for this situation. For example, the Israel-Palestine conflict led to 96% of the Gaza population facing acute food insecurity.

Hunger, food insecurity, and malnutrition are socially and regionally unequally distributed with low- and middle-income countries, rural areas, women and marginalised groups on the front line. The report mentions that, since data first became available in 2015, the rate of food insecurity has consistently been higher for women compared to men, both globally and across all regions.

Lastly, although these drivers are unique, they often interact, and the compounding impacts conduct to the highest increases in food insecurity and hunger.

Using financing to end hunger, food insecurity and malnutrition

The report identified that financing has a critical role in addressing food security and nutrition challenges. As there was no common definition regarding financing for food security and nutrition, the FAO started by defining it to build a consensus. Defining financing for food security and nutrition and tracking its implementation is crucial for sustainability.

Public and private investments in food security and nutrition are insufficient to meet the growing needs. Although there have been efforts to increase investments in agriculture and nutrition, these efforts are often fragmented, lacking coherence and coordination among stakeholders. There is also a significant gap between the required funding to end hunger and achieve food security and the available funds. For example, the report stresses that meeting SDG Targets 2.1 and 2.2 would necessitate an additional investment from now until 2030 ranging from USD 176 billion to USD 3,975 billion. Nevertheless, it is important to emphasise that the cost of inaction will be significantly higher.

Furthermore, there is a misalignment between the priorities of funding organisations and the actual needs. Funds are sometimes allocated based on donor interests rather than pressing needs. For example, international aid and development funds are often inadequately aligned with the specific needs of food-insecure populations, resulting in inefficient use of resources. Many low- and middle-income countries face budgetary constraints that limit their ability to invest in food security and nutrition programmes.

Additionally, innovative financing mechanisms such as blended finance approaches, which combine public and private resources can leverage investment in food systems. The report also advocates for expanding social protection programmes, such as cash transfers and food vouchers, to help address immediate needs while supporting long-term food security.

Lastly, in the current context of climate change, climate finance, such as investment in climate-resilient agriculture and infrastructure, must be integrated into food security efforts to address the impacts of climate change on agriculture and food systems.

Strategic recommendations and approaches

• Reforming financing architecture

Governments should adopt an integrated food systems approach, including various sectors, that addresses the multiple dimensions of food insecurity and malnutrition. It is crucial to develop comprehensive food support programmes supported by coherent and innovative financial plans and policies linking agricultural policies with health, education, and social. This approach will have a lasting impact, not just during emergencies.

The report calls to prioritise funding mechanisms for the most vulnerable populations and regions affected by food insecurity, as they have the least access to funding.

• Improving data and monitoring

Investing in better data collection and monitoring systems is essential for understanding food security and nutrition dynamics. Additionally, accurate data helps to track progress and the effectiveness of financing strategies and their impact on food security and nutrition.

Ensuring transparency in the allocation and use of resources can enhance accountability and improve the efficiency of food security and nutrition programmes.

• Promoting sustainable agriculture

Research, technology and innovation in agriculture should be supported to build more sustainable and resilient food production systems. Hence, it is essential to invest in extension services, agricultural infrastructures, climate adaptation measures, reducing food loss and waste, and sustainable and climate-smart agricultural practices.

Smallholder farmers and rural communities, often left behind, must receive financing to improve their access to land, technologies, and markets, which will benefit their productivity and ultimately, reduce poverty and food insecurity.

All in all, financing for food security and nutrition is insufficient, inadequate and misaligned. Thus, the report underscores the urgency of addressing food insecurity and malnutrition through increased, adequate and more effective financing. By understanding the drivers of food insecurity, addressing financing gaps, and implementing strategic recommendations, it is possible to make significant progress towards ending hunger and food insecurity, and improving global nutrition.

Written by David Mingasson, SIANI reporter