EU - Agriculture

13 - EU bilateral ODA to AG

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Agriculture is among the EU’s top priorities for 2014 to 2020

In 2016, the European Union institutions (EUI; including the EU and European Investment Bank, EIB) spent US$1.8 billion of its ODA on agriculture (the latest year for which multilateral and bilateral OECD data is available), making it the largest donor to agriculture. This sector accounted for 9% of the EUI’s total ODA. In 2016, all of the EUI’s agricultural ODA was channeled as bilateral funding. This includes both funding channeled bilaterally (77%) as well as funding channeled as earmarked funding through multilaterals (23%), which is reported to the Organisation for Economic Co-operation and Development (OECD) as bilateral funding.  

The EUI’s bilateral ODA to the agriculture sector has gradually increased since 2012 and funding peaked in 2016 at US$1.4 billion, driven by large disbursements for its Nutrition for Growth commitment, an initiative where participating countries signed on to a ‘global compact’ to improve nutrition and made a range of international commitments. However, between 2016 and 2018, bilateral funding dipped by 26% to US$1.5 billion in 2018. 

EUI support multiple thematic programs and multilateral initiatives that contribute to the agricultural sector. These include the following initiatives: 

  • In 2017, under the European Investment Plan (EIP), the European Fund for Sustainable Development (EFSD), which is EU’s blended finance facility, started the implementation of programs aimed at mobilizing investment in Africa and the EU neighborhood. One of the five investment windows supported under this program was ‘Sustainable Agriculture, Rural Entrepreneurs, and Agroindustry’. In the same year, the EUI launched the Agriculture Financing Initiative ‘AgriFI’ for supporting investments on agri-business projects in low- and middle-income countries (LMICs). 

  • In 2018, the EUI launched the Development Smart Innovation through Research in Agriculture ‘DeSIRA’ initiative, aimed at supporting climate-relevant adaptation and sustainable transformation of agriculture and food systems in low and middle-income and committed to spending €270 million (US$319 million) on this initiative between 2018-2020. 

  • In February 2019, the EUI provided €45 million (US$53 million) through the EFSD for the Agri-Business Capital ‘ABC’ Fund, established for improving access to finance to smallholders and farmers' organizations.  

  • Most recently, in May 2020, as a part of the ‘European Green Deal’, the EC released its proposal for a ‘Farm to Fork’ strategy, the first comprehensive cross-sectoral strategy for food value chain policies, aimed at making the EU a global standard-setter on sustainable food systems. The policy strategy includes a significant international component with emphasis on Africa and research cooperation. The EUI has also consistently committed funding for the Consortium of International Agricultural Research Centers (CGIAR) and provided US$38 million for the 2020-2021 period to CGIAR. 

The EU highlights sustainable agriculture as one of five key development priorities for 2014 to 2020. Focus areas under this key priority are small-holder agriculture, the formation of producer groups, supply, and marketing chains, as well as government efforts to facilitate responsible private investment. The European Commission (EC) allocated €1.4 billion (US$1.7 billion) of the ‘Programme on Global Public Goods and Challenges’ (GPGC), funded through the Development Cooperation Instrument (DCI) for 2014 to 2020, to the priority area ‘Food and Nutrition Security and Sustainable Agriculture’. In accordance with its strategic priorities, the EUI’s bilateral development financing focused on agricultural policy and administrative management (24%), rural development (18%), and agricultural development (18%) in 2018.  

DG DEVCO’s Directorate on Planet and Prosperity leads policy in agricultural ODA 

Within the EC’s Directorate-General for Development Cooperation (DG DEVCO), the Directorate ‘Planet and Prosperity’ oversees policies related to agriculture ODA. Two relevant units in this regard are Unit C1 for ‘Rural Development, Food Security and Nutrition’, and Unit C2 for ‘Environment, Natural Resources, Water’.