Context

Agriculture is featured in the EU's domestic and external action food policy through its Farm to Fork strategy. This agriculture/food systems strategy emphasizes agroecology and includes an external dimension, with a particular focus on Africa.

The main focus areas in the sector are:

• Investing in small-scale farmers to reduce their vulnerability.
• Supporting governmental initiatives and programmes that encourage sustainability and innovation in the agricultural sector such as research and development projects striking the right balance between developing productivity and not jeopardising natural resources, while strengthening agricultural innovation systems for long term impact.
• Promoting agricultural practices and technologies that raise rural income while being sustainable in terms of water, soils and ecosystems, and biodiversity,
• Improving farmers’ access to productive assets, such as land, capital etc., notably by encouraging local cooperation and partnerships between farmers.
• Leveraging more private investments in the agricultural sector;
• Empowering women in agriculture.

Team Europe adopted conclusions in 2022 in response to global food insecurity stemming from the war in Ukraine. One of the strands of focus is production, resilience, and food systems transformation. The Council strongly encouraged the Commission and the Member States to increase support to sustainable, inclusive and resilient agri-food systems by investing in food value chains and agro-ecological and other innovative approaches in general, more efficient and sustainable use of synthetic inputs, such as fertilizers and pesticides, improved resilience to climate change, enhanced capacities of local producers, and access to finance by smallholder farmers and farmers’ organizations.

EU leaders have agreed to accelerate work on EU initiatives aiming to support Africa’s sustainable agri-food production capacities and support the development of input manufacturing capacity in developing countries, in particular sustainable fertilizers.

Some relevant Team Europe Initiatives are the TEI “Resilient Food Systems”, supporting R&I in agriculture for climate adaptation and improves crisis-reaction capacities at regional and national levels and the TEI “Plant Proteins Development in Africa”, supporting the production of plant proteins in 15 African countries including by promoting agro-ecological approaches. In addition, Team Europe pledged over EUR20 billion (US$24 billion) for the Africa-EU Green Energy Initiative of which EUR3.4 billion (US$3.6 billion) are grants from 2021 to 2027 from the European Commission.

ODA Spending

How much ODA do the EUI allocate to agriculture?

In 2022, EU agricultural ODA increased in absolute terms, but fell relative to other priorities such as costs of housing refugees and support to Ukraine. If compared to DAC donors, the EU would be the 2^nd largest donor to agriculture in absolute terms.

The overall decrease in ODA to agriculture between 2017 and 2022 results from an ODA budget constrained by competing issues such as COVID-19 recovery and pressures related to the war in Ukraine. Despite decreasing ODA funding, the EU continue to emphasize the importance of the sector, especially in relation to food security, as this is a growing priority for the EU. For example, the EU plans to invest US$19 billion in food security worldwide between 2020-2024.

How does the EUI allocate agricultural ODA?

Bilateral Spending

All the EUI’s ODA to agriculture is channeled as bilateral funding, including funds channeled as earmarked funding through multilaterals, which fell as a share of agricultural ODA in 2022.

Projects related to agricultural financial services, rural development, and agriculture development, received the largest shares of funding. Notably, Agricultural financial services increased 800% as a share of agricultural ODA in 2022, breaking with typical prioritizations from 2020-2023.

Multilateral Spending and Commitments

Until 2021, the EUI had not provided any core contributions to multilaterals working in agriculture. Recent pledges made to multilaterals working on this issue are summarized below. Some of these pledges are counted as bilateral funding, since they constituted earmarked funding through multilaterals rather than core contributions.

Funding and Policy Outlook

What is the EUI's current outlook on agricultural ODA?

Climate change adaptation and mitigation will continue to be important components of the EUI’s agriculture ODA. The EU’s Farm to Fork strategy outlines a plan to promote environmentally and socially just food systems. This strategy was proposed by the EC in May 2020 as a part of the European Green Deal. It includes an international component, with an emphasis on countries in Africa and research cooperations.

The EU will continue to support CGIAR. The EUI have consistently committed funding to the multilateral agricultural research network, CGIAR, including US$35 million for 2020-2021. In September 2021, the EC announced a new commitment US$166 million to CGIAR across the 2021-2027 EU long-term budget. The funding will come from the Global Challenges budget line in NDICI - Global Europe and from the geographical envelopes.

Funding for agriculture will continue to come mainly from the geographic envelope. Under the 2021-2027 MFF’s NDICI - Global Europe, most of the funding for agriculture will come from the geographic funding envelope. However, food security is mentioned as a subset of issues to be addressed in the Global Challenges – Planet thematic program.

In response to Russia's war against Ukraine and the food security crisis stemming from it, the EU has announced some investments in food security. In addition to the 2021-2027 MFF’s NDICI - Global Europe, in September 2022, the EC allocated funding worth US$632 million from the EDF for food security to countries in West, Central, East, and Southern Africa, the Caribbean, and Pacific. The funding was re-directed from funding for the 10^th and 11^th EDF. In November 2022, the EC announced an additional US$221 million in humanitarian assistance to help individuals in partner countries impacted by the global food crisis. The funding will be channeled to countries in West and Central Africa, East and Southern Africa, the Middle East, and Latin America, as well as to Afghanistan specifically. An additional US$27 million was pledged in January 2023 to several partner countries in Africa.

EUI supports blended investments in agri-business. Through its AgriFI, launched in 2017, the EU facilitates impact investments in agri-business projects in low- and middle-income countries. Through its ABC Fund, launched in February 2019, the EUI provided US$50 million through the EFSD to improve access to finance for smallholders and farmers' organizations.

Key Bodies