Bonn climate talks signal need for good food finance

Food and climate are intimately intertwined. Food systems generate an estimated 1/3 of global heating emissions, while climate change degrades water supplies, ecosystems and biodiversity that are critical to agricultural production. The United Nations Global Crisis Response Group on Food, Energy, and Finance finds that the ongoing global food security crisis is colliding with environmental and geopolitical pressures, and with a cost of living crisis affecting people around the world.

According to their second brief:

“An estimated 1.6 billion people in 94 countries are exposed to at least one dimension of the crisis, and about 1.2 billion of them live in ‘perfect-storm’ countries which are severely vulnerable to all three dimensions – food, energy and finance…”

Food systems were not front and center during the SB56 round of United Nations Climate Change negotiations, though issues affecting food supplies and food security were raised in relation to many items on the official agenda.

  • Adaptation and Loss and Damage featured discussion of degraded lands and ecosystems, and related threats to livability and livelihoods. Avoiding maladaptation is a particular area of concern raised by many Parties around food systems and agricutural landscapes.
  • The Koronivia Joint Work on Agriculture process “noted the importance of considering sustainable land and water management for agriculture in a systemic and integrated manner informed by scientific, local and indigenous knowledge…”
  • There was recognition from both developed and developing countries that inclusion can serve as an accelerator of progress. Stakeholder participation helps to align high-level policy and investment with local needs, constraints, and capabilities.

The Koronivia draft conclusions recognized that improved agricultural strategies should be:

“implemented in a participatory and inclusive manner and taking into consideration regional, national and local circumstances to deliver a range of multiple benefits, where applicable, such as adaptation, adaptation co-benefits and mitigation, to ensure food security and nutrition.”

Farmers, for instance, may already possess the knowledge needed to assess how changes in ecosystems, biodiversity, and watersheds will affect food supplies in the short or medium term. Participatory policy processes and distributed financing models, which might aggregate the climate-related efforts of many small farmers can lead to new business models, new agricultural extension services, and new development finance opportunities.

Some of these business models are beginning to take shape and get to work. Data service intermediaries—who link satellite data to traditional production methods and the performance of smallholders in securing or restoring natural carbon sinks—are one example.

Other issues related to national capability for agriculture transition, which were discussed during the June climate negotiations in Bonn, include:

  • fiscal space and stability;
  • green finance instrumentation and mobilization;
  • technical capacity for aligning practice, policy, incentives, and investment;
  • trade-related pressures not under the control of the Parties in question.

The examination of “fiscal space and stability” questions is significant, in that fiscal stability is a macrocritical resilience indicator. In other words: If a nation cannot fund itself, many aspects of national governance can fail, and there was new recognition at the SB56 that climate-related macrocritical pressures need to be addressed by fiscal stability measures.

This is partly a response to the agreement among 196 nations in Glasgow last year that Special Drawing Rights—a fiscal stability measure—should be a new way of delivering climate-aligned financial assistance to countries in need. It is also a recognition that the worsening multifaceted global crisis situation is making it harder to meet climate and sustainability goals, and could undermine both trade efficiency and food security.

This is where it is important to note that the Bonn talks delivered a critical breakthrough in support of “non-market approaches” to cooperative decarbonization, under Article 6, Paragraph 8 (Article 6.8) of the Paris Agreement. “Non-market” effectively means any kind of international cooperation that is not “emissions trading” but which enhances overall global emissions reductions.

Citizens’ Climate International, in a comment on NMAs and food security, has noted:

“Article 6.8 effectively invites nations to become laboratories for creative climate policies that steer a greater and greater share of overall investment toward support for nature and nature-positive waste-free business models.”

Article 6.8 also calls for non-market approaches (NMA) to facilitate successful adaptation, build resilience, foster sustainable development, and advance poverty reduction efforts. There are many ways in which these goals, together, align NMAs with food security priorities. Food-related NMAs might operate through:

  • Carbon taxation and land use incentives;
  • Green-labeled finance, including direct investments in nature (without offsetting, emissions trading or other modifications to national carbon accounting);
  • Multiscale aggregated financial initiatives that support capacity building and the shift to climate-smart agricultural practices;
  • Deployment of data systems that allow sharing of information about the impact of specific practices or investments on nature;
  • Technology transfer activities;
  • Climate-aligned financial regulations and debt relief.

The pre-session synthesis report of consultations and formal submissions regarding Article 6.8 non-market approaches provides long lists of known existing NMAs and possible innovative NMAs which could emerge as the formal work programme advances and countries begin to mobilize these cooperative solutions. Among these are financing for adaptation, biodiversity assessments, and “Cooperative programmes that address agriculture, land, food security, biodiversity and climate change, as well as issues under related Sustainable Development Goals”.

The Good Food Finance Network has identified 14 Actionable Areas of Innovation related to green finance instrumentation and mobilization, which can already begin to advance food systems transformation. Many of these can serve as NMAs, to align, connect, and accelerate policies that affect national climate action capabilities.

The news from Bonn is that climate-aligned food-related finance is becoming a priority for local communities, national governments, and international cooperation. We can now start to see how new, precisely aligned tools, can support an unprecedented pace of innovation across sectors, to transform food systems, finance, national fiscal priorities, and trade.

This article was written by Joseph Robertson, EAT Senior Advisor for Sustainable Finance, a member of the GFFN Secretariat, and Executive Director of Citizens’ Climate International.

Published by GFFN Secretariat

The Good Food Finance Network Secretariat is comprised of the convening core partner organizations’ dedicated team members, who share responsibility for coordinating the Network and its activities. The convening core partners are EAT, FAIRR, Food Systems for the Future, UNEP, and WBCSD.

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