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Blended finance for agriculture: exploring the constraints and possibilities of combining financial instruments for sustainable transitions

Author

Listed:
  • Tanja Havemann

    (Clarmondial AG)

  • Christine Negra

    (Versant Vision LLC)

  • Fred Werneck

    (Clarmondial AG)

Abstract

Transitioning to sustainable agricultural systems is imperative to meet the global Sustainable Development Goals (SDGs). Achieving more sustainable agricultural production systems will require significant additional capital, however this cannot be covered by the current financial market setup, which dissociates public and private funders. Blended finance, where concessionary development-oriented funding is used to mobilize additional private capital, is essential. To ensure that the limited pool of concessionary funding is used efficiently and effectively, a shared understanding of the roles and limitations of public and private funders is necessary. In this paper, we describe the high-level funding gap for sustainable agriculture, the general landscape of agricultural finance, and the concept and potential roles of blended finance in this context. This paper introduces the conditions under which different financing mechanisms can contribute to addressing barriers related to sustainable agriculture investments. It highlights that multiple funding modalities must be utilized in order to achieve agricultural investment at a meaningful level and encourages greater exploration of the range of blended financing structures to increase SDG-related agriculture investments.

Suggested Citation

  • Tanja Havemann & Christine Negra & Fred Werneck, 2020. "Blended finance for agriculture: exploring the constraints and possibilities of combining financial instruments for sustainable transitions," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 37(4), pages 1281-1292, December.
    • Handle: RePEc:spr:agrhuv:v:37:y:2020:i:4:d:10.1007_s10460-020-10131-8
    DOI: 10.1007/s10460-020-10131-8
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    References listed on IDEAS

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    1. Carter, Patrick & Van de Sijpe, Nicolas & Calel, Raphael, 2021. "The elusive quest for additionality," World Development, Elsevier, vol. 141(C).
    2. Sarah Velten & Julia Leventon & Nicolas Jager & Jens Newig, 2015. "What Is Sustainable Agriculture? A Systematic Review," Sustainability, MDPI, vol. 7(6), pages 1-33, June.
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    Cited by:

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    2. Sharmiladevi Jekka Chandrasekaran, 2024. "Agricultural Value Added in BRICS: A Panel Data Study," International Journal of Energy Economics and Policy, Econjournals, vol. 14(3), pages 171-178, May.
    3. Labanya Prakash Jena & Amlan Bibhudutta, 2023. "Blended financing application in Indian cities’ clean transportation financing," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 25(1), pages 146-161, December.
    4. repec:ags:ijaeri:334605 is not listed on IDEAS
    5. Gerlinde Behrendt & Sarah Peter & Simone Sterly & Anna Maria Häring, 2022. "Community financing for sustainable food and farming: a proximity perspective," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 39(3), pages 1063-1075, September.
    6. Monica Laura Zlati & Andrei Mirel Florea & Valentin Marian Antohi & Marius Sorin Dinca & Florentin Bercu & Costinela Fortea & Stanciu Silvius, 2023. "Financing Romanian Agricultural Cooperatives’ Investments for the 2023–2027 Horizon," Sustainability, MDPI, vol. 15(3), pages 1-28, January.
    7. Omobolaji Omobitan & Aditya R. Khanal, 2022. "Examining Farm Financial Management: How Do Small US Farms Meet Their Agricultural Expenses?," JRFM, MDPI, vol. 15(3), pages 1-15, March.
    8. Omid Sabbaghi, 2024. "The United Nations Sustainable Development Goals and global finance: Recent evidence," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(5), pages 4020-4033, September.
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    10. Linus Nyiwul & Niraj P. Koirala, 2022. "Role of foreign direct investments in agriculture, forestry and fishing in developing countries," Future Business Journal, Springer, vol. 8(1), pages 1-12, December.
    11. Olga Mapanje & Selma Karuaihe & Charles Machethe & Mao Amis, 2023. "Financing Sustainable Agriculture in Sub-Saharan Africa: A Review of the Role of Financial Technologies," Sustainability, MDPI, vol. 15(5), pages 1-20, March.
    12. Charissa Bosma & Lars Hein, 2023. "The climate and land use change nexus: Implications for designing adaptation and conservation investment strategies in Sub‐Saharan Africa," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(5), pages 3811-3830, October.
    13. Yong Jiang, 2023. "Financing water investment for global sustainable development: Challenges, innovation, and governance strategies," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(2), pages 600-611, April.
    14. Leslie Lipper & Romina Cavatassi & Ricci Symons & Alashiya Gordes & Oliver Page, 2021. "Financing adaptation for resilient livelihoods under food system transformation: the role of Multilateral Development Banks," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 13(6), pages 1525-1540, December.
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    16. Patience Pokuaa Gambrah & Qian Yu, 2025. "Smallholder farmers’ network structure: a case study in Ghana," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(3), pages 1-17, March.

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