Since its inception, the Lab has worked hand in hand with finance institutions, governments and the private sector to launch 41 solutions to drive investment in climate action and sustainable development. Collectively, these solutions have mobilized $2.07 billion in sustainable investment to date, including over $800 million from the private sector and $370 million in original investment by Lab Member institutions. Notably, sustainable agriculture features prominently in the Lab’s suite of solutions, with 10 of the 41 instruments related to agriculture, forestry and nature based solutions.
The Lab works on the principle of championing and supporting high quality ideas with the greatest potential to be scaled up, all while leveraging the expertise of the global Lab as well as regional labs in Brazil, India and from the 2020 cycle, Southern Africa. Solutions are only backed following a rigorous appraisal process. The process begins with a call for ideas. Once all submissions have been made, they are judged according to their eligibility. Subsequently, the strengths and weaknesses of each proposal are identified and analysed before a shortlist of finalists is drawn up. Submissions are assessed against four key criteria, namely how actionable they are, their ability to catalyse investment, innovation and financial sustainability. During the 2020 cycle, there were 195 submissions in total, with 8 selected at the end of the process as the winning proposals.
Thanks to the second phase of the Adaptation for Smallholder Agriculture Programme (ASAP2), IFAD has funded the sustainable agriculture for smallholders in sub-Saharan Africa work stream for the past two years. This year’s winning proposal within this stream was the land accelerator: rural prosperity bond, which has the overarching goal of bridging the finance gap for small and medium enterprises specialising in selling inputs for land restoration, many of which are underserved by microfinance. It is anticipated that the proposal will reduce emissions from land degradation while simultaneously building smallholders’ resilience to climate change. The bond provides funding to small and medium enterprises that graduate from the World Resource Institute’s Land Accelerator programme to sell inputs for land restoration to farmer groups on credit. Farmers in turn repay in produce which is then aggregated and sold by the cooperative to large-scale buyers.
IFAD is very proud to be involved in the Lab as one of the key funding partners. However, the Fund’s involvement goes beyond providing funding. IFAD has been intimately involved in technically supporting the 2020 cycle of submissions.
For example, Oliver Page, IFAD’s regional climate and environmental specialist for Latin America and the Caribbean, was involved in the screening of the proposals received by the Brazil hub during this cycle. One such submission was the Conexus Impact Fund, which seeks to unlock available credit lines for community-led-enterprises that foster forest conservation practices by smallholders and forest dwellers. Conexus consists of a blended finance structured socio-environmental impact fund that will operate in a business platform offering tailored financial products to community enterprises across Brazil.
To find out more visit https://www.climatefinancelab.org/ or contact Sebastien Subsol (s.subsol@ifad.org) or Amath Pathe Sene (amath.sene@ifad.org).