Ending hunger by 2030: are we investing enough?

Sustainability

Ending hunger by 2030: are we investing enough?

Rory Meryon

Senior analyst, Policy & Insights team, Economist Impact

Rory Meryon is a senior analyst in the Policy & Insights team at Economist Impact, and is based in London. He previously worked at HM Treasury, the U.K. government's economic and finance ministry. Rory holds a master's degree in International Public Policy from University College London and a bachelor's degree in Biological Sciences from the University of Oxford

Read more from Rory Meryon

Ending hunger by 2030: are we investing enough?

“End hunger” [1]. The second UN Sustainable Development Goal (SDG2) leaves no room for doubt about the scale of its ambition. In 2015—the year the SDGs were agreed—this was not wholly unrealistic. Between 1991 and 2014, 72 countries succeeded in halving the size of their populations suffering from undernourishment [2]. Although it was unlikely that progress would continue at this rate, in recent years efforts to end hunger have been hindered in ways that few could have predicted. The covid-19 pandemic and escalating climate crisis forced 150m more people into hunger in 2021 than there had been in 2019 [3]. Given further socioeconomic and political disruptions to global food supplies in 2022, the UN now projects that nearly 670m people will face hunger in 2030 unless decisive action is taken today [4].

A major increase in funding is required

Restoring progress towards ending hunger will require a significant increase in funding. This will be necessary to bolster agricultural productivity, such as by investing in rural infrastructure and irrigation systems; build resilience, for instance by funding research into innovations that foster adaptive capacity, including novel digital tools; and expand social protection programmes, for example through food subsidies [5][6]. Although estimates for the requisite additional funding vary, there is broad consensus that current funding levels fall startlingly short of what is necessary to end hunger [7][8]. Constrained government budgets in many low- and middle-income countries (LMICs) mean that much of this shortfall must be met by overseas development funding. In 2020 Ceres2030—a partnership between academia, civil society and economists [9] —estimated that of the additional US$33bn of government and donor funding needed annually to end hunger by 2030, US$14bn would have to be provided by international donors—more than double existing donor contributions [10].

Of this additional development funding, Ceres2030 earmarked US$9bn for investment in agri-food (agriculture, forestry and fishing) systems [11]. Advocates for elevated investment in agri-food argue that it can help to reduce hunger by boosting agricultural productivity and production while increasing resilience to shocks, thereby improving the availability and affordability of food [12]. For example, by providing small-scale farmers with the capital necessary to purchase seeds and pest management products, donors can help them to improve yields and bolster food supply [13]. Similarly, funding for research and development (R&D) can facilitate the discovery of agricultural innovations related to food, water and land systems, which can support productivity in countries affected by hunger [14][15]. Crucially, R&D is vital for the development of innovative crop varieties that can safeguard agricultural production in spite of a rapidly changing climate. For example, heat-tolerant maize, which is currently under development in international agricultural research centres, has the potential to bolster the resilience of maize yields in climate-vulnerable regions of South Asia [16].

Our preliminary analysis of datasets from the Food and Agriculture Organisation (FAO) in ten LMICs supports the view that increased development funding for agri-food is needed to reduce hunger [17]. As shown in the graph below, until 2017 increased development funding for agri-food was associated with a significant reduction in undernourishment. This may be the result of gains in agricultural productivity. In 2001 the average value added of the agro-food industry (the output of the sector minus intermediate inputs) was US$96bn in the countries we assessed. By 2020, it had more than doubled, reaching $197bn [18].

A concerning recent increase in undernourishment

These correlations are far from conclusive, and do not imply a causal relationship between development funding, productivity and hunger. Despite a sharp uptick in funding since 2017, the prevalence of undernourishment has steadily risen. This worrying trend may be explained by a combination of factors. First, gains in agricultural productivity do not necessarily benefit those most vulnerable to hunger. Second, a huge portion of agricultural output is wasted (as much as a third, according to some estimates) [19]. Third, significant volumes of food are produced for export, rather than domestic consumption. And lastly, enhanced agricultural output cannot prepare populations for acute crises, such as conflicts, which are one of the principal causes of hunger [20]. As such, a myopic focus on funding agricultural productivity gains may obscure the mechanisms by which hunger persists today, as well as the solutions that will ensure its elimination.

In our upcoming research report, Economist Impact will investigate prevailing trends across a variety of funding channels for agri-food, such as government expenditure, donor funding, and foreign direct investment. In doing so, we will seek to discern how the size, direction and composition of these funding channels affect hunger and malnutrition (particularly undernourishment), as well as how new pressures, such as climate change, will influence demand for finance. Building on previous estimates of the additional funding required to achieve zero hunger, we hope to explore whether current funding trends are sufficient to realise the goal of ending world hunger by 2030.

[1] https://unstats.un.org/sdgs/indicators/Global%20Indicator%20Framework%20after%202022%20refinement_Eng.pdf
[2] https://education.nationalgeographic.org/resource/opinion-we-can-end-hunger-heres-how
[3] https://www.who.int/news/item/06-07-2022-un-report--global-hunger-numbers-rose-to-as-many-as-828-million-in-2021
[4] Ibid.
[5] https://www.fao.org/3/i4951e/i4951e.pdf
[6] https://ceres2030.iisd.org/wp-content/uploads/2021/07/ceres2030-nature-portfolio-.pdf
[7] https://ceres2030.iisd.org/wp-content/uploads/2021/07/ceres2030-nature-portfolio-.pdf
[8] https://www.fao.org/3/i4951e/i4951e.pdf
[9] A partnership between Cornell University, the International Food Research Policy Institute, and the International Institute for Sustainable Development, and funded by the Federal Ministry of Economic Cooperation and Development of Germany and the Bill and Melinda Gates Foundation. It aims to achieve a world without hunger, where small-scale producers enjoy greater agricultural incomes and productivity, in a way that supports sustainable food systems
[10] https://ceres2030.iisd.org/wp-content/uploads/2021/07/ceres2030-nature-portfolio-.pdf
[11] https://ceres2030.iisd.org/wp-content/uploads/2021/07/ceres2030-nature-portfolio-.pdf
[12] https://globalagriculturalproductivity.org/wp-content/uploads/2019/01/2014_GAP_Report.pdf
[13] https://www.agdevco.com/site/assets/files/1020/agdevcosdg.pdf
[14] https://www.gatesfoundation.org/our-work/programs/global-growth-and-opportunity/agricultural-development
[15] https://www.globalcitizen.org/en/content/why-smallholder-farmers-need-funding/
[16] https://www.cimmyt.org/projects/heat-stress-tolerant-maize-for-asia-htma/
[17] China (mainland); Colombia; Côte d'Ivoire; Ethiopia; India; Kenya; Nigeria; Peru; the Philippines; Ukraine. These countries were selected given their geographic spread, status as LMICs, and receipt of comparatively large volumes of development funding (to ensure the significance of across-year trends).
[18] World Bank data (agriculture, forestry and fishing, value added - constant 2015 US$); author’s calculations using ten countries listed above, except Cote d’Ivoire for which insufficient data were available.
[19] Food and Agriculture Organisation of the United Nations, Summary Report, Food wastage footprint: Impacts on natural resources. Natural Resources Management and Environment Department. Food and Agriculture Organisation of the United Nations. Rome, Italy, 2013.
[20] https://www.worldhunger.org/world-hunger-and-poverty-facts-and-statistics/

Related content

Resetting the agenda: How ESG is shaping our future

Sustainability

Resetting the agenda: How ESG is shaping our future

The Covid-19 pandemic has exposed a wealth of interconnections – between ecological and human wellbeing, between economic and environmental fragility, between social inequality and health outcomes, and more. The consequences of these connections are now filtering through, reshaping our society and economy.

In this setting, the need to integrate environmental, social and governance (ESG) factors when investing has become even more critical. Institutional investors must employ ESG not just to mitigate risks and identify opportunities, but to engage with companies to bring about the positive change needed to drive a sustainable economic recovery in the post-Covid world.

In order to understand how ESG could be both a new performance marker and a growth driver in this environment, as well as how institutional investors are using ESG to make investment decisions and to assess their own performance, The Economist Intelligence Unit (EIU), sponsored by UBS, surveyed 450 institutional investors working in asset and wealth management firms, corporate pension funds, endowment funds, family offices, government agencies, hedge funds, insurance companies, pension funds, sovereign wealth funds and reinsurers in North America, Europe and Asia-Pacific.

Download the report and infographic to learn more.

Read more

Sustainability

Charting the course for ocean sustainability in the Indian Ocean Rim

Charting the course for ocean sustainability in the Indian Ocean Rim is an Economist Intelligence Unit report, sponsored by Environment Agency Abu Dhabi and the Department of Economic Development Abu Dhabi, which highlights key ocean challenges facing the Indian Ocean Rim countries and showcases initiatives undertaken by governments and the private sector in the region to address these challenges.

Click here to view the report.

Read more

Sustainability

Fixing Asia's food system

The urgency for change in Asia's food system comes largely from the fact that Asian populations are growing, urbanising and changing food tastes too quickly for many of the regions’ food systems to cope with. Asian cities are dense and are expected to expand by 578m people by 2030. China, Indonesia and India will account for three quarters of these new urban dwellers.

To study what are the biggest challenges for change, The Economist Intelligence Unit (EIU) surveyed 400 business leaders in Asia’s food industry. According to the respondents, 90% are concerned about their local food system’s ability to meet food security needs, but only 32% feel their organisations have the ability to determine the success of their food systems. Within this gap is a shifting balance of responsibility between the public and private sectors, a tension that needs to and can be strategically addressed.

Read more