Improved information management and market systems, as well as involving farmers are essential to protecting the environment and crafting innovative and equitable financial instruments tailored to farming communities.
These are the main messages from a regional forum jointly convened by the Philippine government-hosted Southeast Asian Regional Center for Graduate Study and Research in Agriculture (Searca), Commission on Sustainable Agriculture Intensification (CoSAI), and International Union for the Conservation of Nature (IUCN) Asia, a news release said.
Titled, “Paying for Nature and Society: Dialogue on Innovative Financial Mechanisms to Promote Equity and Sustainability in Agriculture-Asia,” the online event was second in a series of regional discussions to understand how to incentivize farmers to protect and restore nature.
It drew attention to agriculture as a force for good in environmental conservation.
Dr. Dindo Campilan, regional director of IUCN Asia and Oceania Hub, pointed out the importance of innovation in financial instruments to promote environmental sustainability.
Meanwhile, Dr. Ximena Rueda of CoSAI and the Universidad de los Andes discussed the financial instruments developed for conservation that offer enormous opportunities for expansion into agricultural landscapes.
She pointed out that to be more effective, innovations must factor in political, technological and institutional factors affecting farmers and other target stakeholders.
Different perspectives and experiences with design or implementation of innovative financial incentives in agriculture were shared by a panel composed of leaders from the national government, Asian organizations, and private sector.
They tackled ways in which financial incentives are designed as well as aspects of replicability, scalability, and temporality of financial incentives in agriculture to support sustainable and equitable development.
Sri Lanka Agriculture Technology Secretary Gamini Samarasinghe shared that farmers in his country receive incentives from the Ministry of Agriculture through locally funded projects to help sustain production.
He added that to provide an enabling environment for the farmers, the Sri Lankan government also establish effective and inclusive market systems and strengthen information management systems of lands, production, subsidies and value chains.
The need to provide farmers with incentives was affirmed by Irish Baguilat of the Asian Farmers’ Association (AFA), citing how farmers’ organizations can play a key role in promoting innovative new green financial instruments.
A case in point she discussed was AFA’s joint project with UN Food and Agriculture Organization in Bangladesh, which promoted financial instruments in a larger scale.
Dr. Prasun Kumar Das, secretary general of the Asia Pacific Rural and Agricultural Credit Association (Apraca), one of the largest agricultural development banks in Asia, shared his experience in advocating for financial instruments through Apraca.
He noted that the challenges for farmers included insufficient income to prove credit worthiness, fear of getting deep in debt, lack of insurance coverage, volatility of borrowers’ businesses, and lack of technical know-how.
He affirmed Rueda’s observation that financial instruments must be able to contextualize environmental, social and governance factors in the target farming communities.
Erin Sweeney, lead for Sustainable Investment and Inclusion of Grow Asia, pointed out the need for greater collaboration across value chains to promoting known solutions and best practices.
She emphasized the need for better policies to bridge the gap between farmers‘ needs and requirements of sustainability standards
Eelko Bronkhorst, managing director of Financial Access, said one of the main challenges is in the disconnect between investment opportunities and requirements for investment in sustainable agriculture.
He noted that it is important to bring together the different models and pilots from across the globe and identify how they can be contextualized per target stakeholder to maximize the potentials of these financial instruments.
Searca Director Dr. Glenn B. Gregorio said the pandemic has highlighted the need for effective and innovative financial mechanisms that are accessible to food producers and farming families.
He expressed hope that the dialogue will help convince financial service providers to invest and offer products that are more supportive of sustainable agriculture.
He also reiterated that strengthening academe-industry-government linkages can provide the tools needed to promote equity and sustainability in agriculture, an advocacy in line with Searca’s focus on Accelerating Transformation through Agricultural Innovation, the Searca news release said.