Highlights:

The world is still far off track to achieve Sustainable Development Goal (SDG) 2, Zero Hunger. Around 28.9% of the global population, or 2.33 billion people, were moderately or severely food insecure in 2023.

Severe food insecurity affected 10.7% of the population in 2023. These are between 713 and 757 million people that might have faced hunger. Hunger is still on the rise in Africa (one person out of every five in Africa), but it has remained relatively unchanged in Asia, while notable progress has been made in the Latin American and Caribbean region.

The cost of a healthy diet increased to $3.96 per person per day in 2022, with over 2.8 billion people unable to afford such healthy diets. This issue is particularly severe in low-income countries, where 71.5% of the population cannot afford a healthy diet.

The world is not on track to meet any of the seven global nutrition targets by 2030. While stunting and wasting among children have decreased, the prevalence of obesity in adults and children is rising, with projections showing over 1.2 billion obese adults by 2030.

Financing for Food Security and Nutrition

Financing to end hunger, food insecurity, and malnutrition is the central theme of the report. In the absence of a coherent, universally accepted definition, the authors define it as the  sum of the public and private financial resources (both domestic and foreign) that are directed towards eradicating hunger, food insecurity and all forms of malnutrition. This includes the availability, access, utilization and stability of nutritious and safe foods, the practices that favour healthy diets, health, education and social protection services that enable these, and financial resources that are directed towards strengthening the resilience of agrifood systems to the major drivers and underlying structural factors of hunger, food insecurity and malnutrition. This new definition captures the multidimensional nature of food security and nutrition, shifting away from the typical sector-defined boundaries.

Public expenditure is critical on agriculture and food security in low-income and lower-middle-income countries, but is extremely low and has not shown significant growth. For instance, in low-income countries, the general domestic government expenditure on agriculture is only about USD 8 per rural inhabitant. This level of spending is insufficient to address the major drivers of food insecurity and malnutrition.

Official Development Assistance (ODA): Food security and nutrition receive less than a quarter of the total ODA and other official flows, which amounted to USD 76 billion per year from 2017 to 2021. However, only 34% of this amount directly addressed the major drivers of food insecurity and malnutrition, highlighting a significant gap in targeted funding.

Tracking private sector financing is more complex. These sources are less transparent and harder to quantify, leading to gaps in understanding the total financial landscape. Private financing from philanthropy, cross-border remittances from migrants invested in agrifood systems, and foreign direct investment may reach a combined total of USD 95 billion per year over the period from 2017 to 2022.

The Financing Gap: The report suggests that the cost of meeting SDG Targets 2.1 and 2.2 could amount to several trillion USD. However, the exact financing gap is difficult to quantify due to the fragmented and inconsistent data on available resources. Failing to bridge this gap by 2030 would have severe social, economic, and environmental consequences, further increasing the cost of inaction.

Recommendations for Catalyzing Scalable Financing

Innovative Financing Mechanisms: The report recommends adopting innovative, inclusive, and equitable financing solutions tailored to the specific needs of different countries. For countries with limited financial access, grants and concessional loans are deemed the most suitable. Countries with moderate access could enhance domestic tax revenues, linking taxation to food security and nutrition outcomes. Those with higher financial capabilities should leverage instruments like green, social, sustainable, and sustainability-linked bonds.

Blended Finance: Blended finance, which combines public and private funding sources, is promoted as a way to reduce the financial risks associated with large-scale investments in food security and nutrition. This approach is particularly relevant for countries with moderate access to financing flows, where collaborative partnerships can help bridge the gap.

Holistic and Coordinated Financing Architecture: The report calls for a shift from a fragmented financing system to a more holistic and coordinated approach. Enhanced coordination among international donors, governments, and private sector actors is crucial to aligning efforts with national and local priorities. Improved transparency, data collection, and harmonization are essential for better targeting and more effective use of financial resources.

Addressing Major Drivers: Financing strategies must be designed to build resilience against the major drivers of food insecurity and malnutrition, such as conflict, climate change, and economic downturns. This requires a comprehensive approach that integrates various financial instruments and focuses on long-term structural changes.

Universal Adoption of a Standardized Approach: The report emphasizes the need for universal adoption of a new, standardized definition of financing for food security and nutrition. This would involve creating a common framework for mapping financial flows and applying this framework consistently across different countries and sectors to ensure more accurate tracking and assessment of financing needs.

The Way Forward

To close the financing gap and achieve the SDG targets, the report underscores the importance of:

• Increasing political commitment to prioritize food security and nutrition in national and international agendas.
• Mobilizing additional resources from both public and private sectors.
• Enhancing the efficiency of existing financial resources through better alignment with identified needs and stronger accountability mechanisms.

The report concludes that achieving SDGs 2.1 and 2.2 will require unprecedented levels of coordinated and targeted financing. Without significant changes in how the world finances food security and nutrition, millions of people will continue to suffer from hunger and malnutrition, with profound global consequences.