Global finance shapes the food system, and public and private financing decisions shape how the food system impacts people and the planet. Today’s global food system – valued at US$8trillion a year and accounting for almost 10 percent of the global economy – is fundamentally unviable as a result of its contribution to climate change, destruction of biodiversity, unstable food prices and security, and provision of low quality, low paid jobs. Indeed, these unpaid-for negative impacts have been estimated to be worth US$12 trillion by the World Bank – significantly more than the food systems’ annual economic value.
NatureFinance’s work on the Food Finance Nexus is seeking how best to ensure a rapid, fair, and safe transition. We need to move towards a system that produces affordable healthy food in ways aligned to climate and nature goals, whilst avoiding transition risks such as widespread bankruptcy, devastating rural unemployment, increased food prices, poverty and inequality.
Getting financialisation right is a pre-condition for an effective food system transition. Crowding in deeper levels of private capital at all stages of the food system is needed to support the transition. But ‘more private finance’ alone is an insufficient condition for ensuring that the transition is rapid, fair, and safe or that it will lead to an inclusive, sustainable, healthy food system.
