Dear UK Parliamentary International Development Committee,

We, as representatives of low-income countries on the Global Agriculture and Food Security Program (GAFSP) Steering Committee, are submitting evidence to the UK Parliament's International Development Committee to demonstrate the impact that GAFSP, with the support from various key donors including the UK Foreign, Commonwealth and Development Office (FCDO)[1], is having on the lives of millions of smallholder farmers and their families in the countries we serve.

GAFSP was launched by the G20 in response to the 2007-08 food price crisis to sustainably address hunger, malnutrition, and poverty in the world's poorest countries. GAFSP finances projects to stimulate local communities' economic growth and resilience, strengthen their knowledge and capacity, generate rural employment, promote inclusiveness, and reduce poverty and food insecurity. 

Since 2010, GAFSP has pooled US$1.7 billion in donor funds to provide financial and technical resources to low-income countries to increase investments in sustainable agriculture and food security. To date, the Program has reached over 16 million smallholder farmers in 49 countries across all regions. These investments focus on smallholder farmers and the organizations that serve them to address issues related to climate change, nutrition, and income generation, paying particular attention to women's and girls' empowerment.

As one of the founding donors, the UK has contributed US$250.1 million (14.8%) to the Program since its inception. UK FCDO has also held a leadership position as GAFSP's Steering Committee co-chair since 2017. We highly value the role played by the UK on the Steering Committee in promoting GAFSP's goals. 

The UK's support to GAFSP plays a critical role in mobilizing and providing funds to smallholder farmers in the world's most fragile and vulnerable countries. As the number of people in extreme poverty grows due to climate change and the global pandemic, the UK's development assistance is more necessary than ever before. With the UK's support, GAFSP has demonstrated that well-targeted, timely, and flexible funding in the agriculture sector helps build pathways from extreme poverty to sustainable livelihoods for the most vulnerable communities, especially for women and girls, to enhance effective inclusiveness in addressing poverty alleviation and food security.

GAFSP welcomes continued dialogue with the UK Government on how to target funds more effectively to tackle extreme poverty and contribute to the achievement of SDG 1, Target 1.1. We fully support the UK's commitment to poverty reduction, food security, and gender equality in international development to create a sustainable and more inclusive future for all. 

Signed by GAFSP's Regional Representatives from Africa, East and South Asia, Europe and Central Asia, Latin and Central America, and Middle East and North Africa

Global Agriculture and Food Security Program (GAFSP)

Evidence submission to the International Development Committee (IDC) on the effectiveness of the development work of the Foreign, Commonwealth and Development Office (FCDO) impacts on SDG1, Target 1.1

Why is your continued support to GAFSP necessary to contribute to poverty eradication?

1. There is an unfolding food crisis that is reversing decades of gains in the fight against poverty and hunger. The time to act is now and continued collaboration is the way forward.

Food price inflation is rising; prices are currently only 3-5% below the peaks of the food price crisis of 2007-08.[2] In addition, global hunger has accelerated under the shadow of COVID-19.[3] In 2020, between 720 and 811 million people faced hunger –as many as 161 million more than in 2019– and an additional 320 million people did not have access to adequate food. This crisis is affecting low-income countries, particularly those affected by conflict and fragility, and vulnerable people disproportionately. GAFSP was set up to respond to such crises.

GAFSP supports resilient and sustainable agriculture systems that benefit smallholder farmers, particularly women and young people in the world’s poorest countries. The Program offers a flexible set of tools (large and small-scale grants, blended finance, technical assistance, and private sector advisory services) that are customized to meet the needs of our constituents, particularly smallholder farmers. This allows funding of public and private actors along the entire value chain, from farm to fork.

We welcome the importance that FCDO places in fostering in-country coordination to reduce the fragmentation of scarce ODA resources. As a founding member, FCDO helped ensure that GAFSP would rely on key implementing development partners, namely agriculture multilateral organizations and development banks with a presence on the ground,[4] with strong ties to national governments, producer organizations, and private sector actors. This enables GAFSP to leverage the expertise of these development partners while complementing their core funds, facilitating coordination at the country level. Most importantly, GAFSP is demand-driven: projects are designed and led by governments, the private sector, and producer organizations with the support of their chosen development partner. An independent group of experts competitively assesses projects, and the final selection is agreed upon for approval on a consensus basis by our inclusive, balanced Steering Committee.

As members of GAFSP's Steering Committee, we consider that the Program's inclusive and transparent governance is a major pillar in its success. We share the decision-making table with donors, civil society organizations (CSOs)[5], and development agencies and contribute our knowledge and expertise to advocate on behalf of smallholder farmers.

2. Agriculture is a key economic sector in our countries and must be at the center of building back better.

Growth in the agriculture sector is two to four times more effective than other sectors in raising incomes among the poorest. Given that 65% of poor working adults make a living through agriculture, it has the potential to create jobs and improve incomes by raising agricultural productivity, linking farmers to markets, and improving non-farm rural livelihoods. GAFSP's portfolio promotes remunerative farm and non-farm jobs as a focus area and aims to improve the incomes of 10 million people in rural households by 20% by 2025 (in the poorest countries that are furthest from achieving the Sustainable Development Goals).

GAFSP recognizes that farmers are innovative entrepreneurs. Public support must be designed to leverage private financing to help small farmers move from subsistence agriculture to more economically viable opportunities.

3. Diversified and customized public and private sector investments is a must to reach the most vulnerable and to address poverty reduction, food insecurity, and nutrition.

GAFSP channels funds through three financing mechanisms: large grants to governments; small-scale grants to producer organizations; and blended finance solutions to the private sector in collaboration with the International Finance Corporation (IFC). 

The world's lowest income countries depend on strong support from the multilateral community, through the International Development Association (IDA), and other similar dedicated funds managed by regional development banks and the UN International Fund for Agriculture Development (IFAD). However, our countries also need additional and complementary instruments targeted solely to agriculture and food security, given the prevailing needs of poor and vulnerable groups and the importance of this sector as an economic growth engine that can secure the livelihoods of millions of people across the world. By offering scarce grant financing, GAFSP enables its development partners to advance their missions, utilizing GAFSP financing to pilot innovative and frontier areas for aid delivery (e.g. agri-business advisory services in fragile and conflict-affected countries or more direct financing to Producer Organizations), and help implement riskier projects or mainstream cross-sector themes such as nutrition, gender or climate.

The majority of GAFSP projects, both private and public, operate in countries with the highest poverty rates (measured as incomes under US$1.90/day). GAFSP funds have been particularly critical for countries and emerging businesses with few alternative financing sources, including countries affected by fragility, conflict, and violence (see box below). Within the multilateral global financing architecture for agriculture, GAFSP remains one of the few instruments providing grants to low-income countries as multilateral ODA for agricultural development tends to be loan-based. This helps explain the high demand for GAFSP, which historically has only been able to fund a third of projects submitted for public financing. During the latest Call for Proposals in 2021, GAFSP attracted more than US$1 billion in funding requests across 40 country-led and 41 producer organization-led submissions – roughly four times the number of proposals typically received in previous calls and seven times more than what it could fund with available resources.

GAFSP funds play a critical role in target communities and has high development impact potential on the livelihoods of the smallholder farmers who are often left behind in the development space. We are providing below two examples of GAFSP's responsiveness to the priorities that its Steering Committee members bring to the table:

Targeting funding where it is most needed

In response to global evidence, in particular FAO's SOFI Reports 2017 and 2018, which highlighted the role of conflict in increased global hunger, GAFSP launched a Special Call in 2019 targeting fragile and conflict-affected countries. This Call, in large part led by UK FCDO, also reflected the Steering Committee's recognition that countries with high levels of need, but limited capacity, are often underfunded.  

Innovating delivery mechanisms

GAFSP CSO members championed the inception of the Producer Organization-led grant modality, designed by and for smallholder farmers. What started as a ‘lab’ in 2016 to test bold and new ideas has become a mainstream mechanism within GAFSP, which allocated US$30 million to 12 producer organizations in 12 countries in December 2021. GAFSP provides more direct funding to smallholders, who were until then unable to mobilize funds from traditional sources, so they become their own change agents. With access to finance, markets, and technology, they can strengthen their capacity to operate, organize, and serve their communities.

4. We must leverage additional funding from other partners to provide financing to smallholder farmers and small-and-medium size enterprises in the most underserved parts of the world.

FCDO emphasizes linking public and private sector activities to maximize the value generated from scarce grant funding by crowding-in and de-risking private investment. 

Leveraging and co-financing are at the core of GAFSP operations. Every additional US$1 of donor support to GAFSP public investments yields an additional US$2.40 in cumulative income for the poor every year, not calculating the spillover effect on the local rural communities. On the private side, every dollar attracts on average US$6.6 from Development Finance Institutions (DFIs) and private investment (including US$1.9 from IFC). GAFSP's private sector funding supports projects that may not attract commercial funding due to perceived or actual high risks.

5. Agricultural investments must address the climate and food nexus to solve daily challenges smallholder farmers face: nutrition and food security, livelihoods, and resilience to shocks.

GAFSP embraces a holistic approach to agricultural development. Given GAFSP's focus on sustainable and resilient agriculture and food systems, the Program has consistently supported climate change adaptation and mitigation efforts. As of December 2020, about 48% of GAFSP public sector financing (US$563 million), of which 40% are from adaptation (US$468 million) and 8% are from mitigation (US$95 million). Furthermore, about 81% of public sector projects (38 out of 47) have included climate elements. Client demand for climate interventions has grown from 40% in the first Call for Proposals to 100% for all proposals from 2017 onwards.

The UK's leadership in the G7 and COP26 presidencies and the fundamental importance of the agriculture/food/climate nexus are gaining in the global arena and are pushing GAFSP to do more. GAFSP is now raising its ambition on climate. As GAFSP offers financing at the country level and can adapt to country, producer organization, and private sector needs, it has the potential to directly align, support, and leverage national climate priorities identified in countries' National Determined Commitments (NCD), National Adaption Plans (NAP), and National Pathways developed through the United Nations Food Systems Summit (UNFSS) process.

GAFSP Public Investments outputs vs progress targets

Furthermore, GAFSP puts a strong focus on nutrition and food security. Close to 60% of GAFSP's public sector projects, totaling US$193 million, include nutrition-related activities. To help mitigate the threats of hunger and malnutrition, GAFSP projects have also put in place post-harvest interventions, such as training on processing and preserving techniques to improve storage and food shelf-life. In that context, GAFSP projects have constructed and/or rehabilitated 882 post-harvest facilities, processing over 75,000 tons of produce.

GAFSP-financed projects empower women by contributing to equitable access to agriculture-related productive assets, providing training opportunities, income-generating activities, and employment and helping promote women's leadership and decision-making in farmers' organizations and self-help groups. Of 16 million rural people reached to date, almost 40% (6.3 million) are women.

6. Smallholder farmers' needs are urgent; funds must be made available quickly and efficiently if we are to meet the goals of ending poverty and hunger.

We cannot overemphasize the pivotal role that the GAFSP Steering Committee plays in allowing the Program to be flexible and responsive in how it finances smallholder farmers' priorities. The Program delivers its financing through periodic Calls for Proposals that we tailor, its members, including UK FCDO, to address current needs. More importantly, we adjust each Call, taking lessons learned from previous experience, enriching how GAFSP works with an iterative approach that keeps the Program focused on serving its most important client, smallholder farmers. Since December 2019, the Program has allocated more than US$350 million in grants to reduce poverty, recover livelihoods and build the resilience of smallholder farmers to shocks in the context of COVID-19 and climate change. A few months after the pandemic hit, GAFSP made US$60 million funds available to its existing portfolio of projects to address immediate emergency needs.

We hope the UK will provide additional commitments for GAFSP's high-quality work. Now, and with new funds, GAFSP is ready to redouble its efforts in countries most affected by COVID-19 and facing pre-existing high pressures, including high rates of hunger and poverty, and climate vulnerability. We are confident that the information submitted demonstrates that, with the UK's support, GAFSP has built pathways from extreme poverty to sustainable livelihoods in line with the UK's development strategy to prioritize the most vulnerable communities around the world.

We welcome the opportunity for continued dialogue with the UK Government on the development effectiveness and how GAFSP can continue to help achieve a world free of poverty.

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