Climate Finance for Small-Scale Agriculture

This report by the Climate Policy Initiative, supported by the International Fund for Agricultural Development (IFAD), proposes a framework for measuring climate finance flows to small-scale agriculture in developing countries and provides a snapshot of international financial commitments for 2017 and 2018.

• Small-scale farmers, defined as those operating on less than 5 hectares of land, make up approximately 95% of global farms and 20% of global farmland. In Asia and Sub-Saharan Africa, these farmers are estimated to produce up to 80% of food, and the agricultural sector in these regions provides over 40% of all jobs and contributes around 15% of the GDP.
• There is a significant gap between the financial needs of small-scale agriculture and the actual climate finance provided. Global annual financial needs for small-scale farmers' agricultural and household-related requirements are estimated at USD 240 billion, with agri-enterprises in Sub-Saharan Africa alone requiring USD 132 billion per year. However, total climate finance for agriculture, forestry, and land use was only USD 20 billion per year in 2017/2018, representing 3% of total tracked global climate finance.
• Climate finance specifically targeting small-scale agriculture reached approximately USD 10 billion per year in 2017/2018, which is 1.7% of total tracked climate finance. This total includes USD 8.1 billion directly targeting small-scale farmers, agri-entrepreneurs, and value chain actors, plus USD 1.72 billion benefiting them through water management, sustainable rural transport, and renewable energy generation.
• Climate finance for small-scale agriculture is overwhelmingly public and grant-based. 95% of the funding comes from the public sector, with governmental donors contributing 39%, multilateral development finance institutions 32%, and bilateral development financial institutions 16%. Grants are the most common instrument (50%), followed by concessional debt (33%) and non-concessional debt (16%).
• The allocation of small-scale agriculture climate finance is focused on adaptation and infrastructure. 49% of funds went to climate adaptation projects, while 21% targeted mitigation only and 29% targeted both. The largest share of activity-based funding (36%) was for low GHG emission and climate resilient infrastructure, followed by farm-level production improvements (14%) and general rural community livelihood improvements (14%).
• Geographically, the largest recipients of climate finance for small-scale agriculture were Sub-Saharan Africa (36%), East Asia and Pacific (20%), and South Asia (16%). Additionally, USD 1.2 billion (12% of the total) was committed to transregional programs.

APA

Climate Policy Initiative (2020). Climate Finance for Small-Scale Agriculture. https://www.climatepolicyinitiative.org/publication/climate-finance-small-scale-agriculture/

Chicago

Climate Policy Initiative. Climate Finance for Small-Scale Agriculture. 2020. https://www.climatepolicyinitiative.org/publication/climate-finance-small-scale-agriculture/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Climate Finance for Small-Scale Agriculture |date=12 November 2020 |url=https://www.climatepolicyinitiative.org/publication/climate-finance-small-scale-agriculture/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2020climate, author = {{Climate Policy Initiative}}, title = {{Climate Finance for Small-Scale Agriculture}}, institution = {Climate Policy Initiative}, year = {2020}, month = nov, url = {https://www.climatepolicyinitiative.org/publication/climate-finance-small-scale-agriculture/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }