TWN Info Service on Sustainable Agriculture
28 March 2025
Third World Network
www.twn.my
Dear Friends and Colleagues
Financing Agroecological Food System Transformation
The UN Food and Agriculture Organization has highlighted the huge potential of agroecology for mitigation and adaptation to climate change. Agroecological practices not only help in cutting GHG emissions, they also “repair the harm” by increasing the number and surface area of active carbon sinks by storing large amounts of carbon in the soil, in addition to increasing socioecological resilience.
Most governments however work on the assumption that there is a scarcity of funds rather than an abundance of money potentially available to tackle climate change and the larger polycrisis in which agri-food systems are centrally implicated. Very large pots of money in the financial system that are ignored by decision-makers provide a basis for ways to harness finance for agroecological transformations that significantly reduce GHG emissions, biodiversity loss, land degradation as well as reverse poverty and hunger.
This blog identifies technically viable, but politically ignored, options to raise large sums of funding for agroecological food system transformation, such as: taxing the ultra-rich, reducing military spending, disinvesting in industrial agriculture and redirecting funding away from greenwashed false solutions.
With best wishes,
Third World Network
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CALLING OUT THE FINANCIAL ELEPHANTS IN THE ROOM: TACKLING THE MYTH OF SCARCITY TO FINANCE AGROECOLOGICAL FOOD SYSTEM TRANSFORMATION
Michel Pimbert
https://agroecologynow.net/calling-out-the-financial-elephants-in-the-room-tackling-the-myth-of-scarcity-to-finance-agroecological-food-system-transformation/
February 2025
In this blog, Michel Pimbert lays out a slate of bold proposals to reframe discussions on how to finance agroecology to focus less on financial scarcity and more on the possibilities of abundance. Michel lays out technically viable, but politically ignored, options to raise large sums of funding such as: taxing the ultra-rich, reducing military spending, disinvesting in industrial agriculture and redirecting funding away from greenwashed false solutions. These very large pots of money are huge ‘financial elephants in the room’ that provide a basis for ways to harness finance for agroecological transformations that significantly reduce GHG emissions, biodiversity loss, land degradation as well as reverse poverty and hunger. There is a way, now we need the will.
History shows that governments often have had to take unprecedented and exceptional measures in times of war and global pandemics. Similarly, the existential threats of biodiversity loss and climate change cannot be tackled through business-as-usual approaches: extraordinary decisions are now required on a war-like footing.
Globally, agri-food systems are responsible for close to a staggering 40% of total GHG emissions. Recent research shows that if current trends in global agri-food systems continue, they will prevent the achievement of the 1.5°C target and threaten the achievement of the 2°C target by the end of the century – even if fossil fuel emissions were immediately halted in other sectors of the economy.
A rapid and substantial reduction in carbon dioxide, nitrous oxide and methane emissions is urgently needed on the farm as well as throughout the entire agri-food system and its global supply chains.
Agroecological solutions for climate repair
The good news is that there are climate-friendly alternatives to petrochemical farming and its energy intensive global supply chains. The UN Food and Agriculture Organisation (FAO and the HLPE) has highlighted the huge potential of agroecology for mitigation and adaptation to climate change. The IPCC’s Sixth Assessment report affirms with high confidence that the “adoption of agroecology principles and practices will be highly beneficial to maintaining healthy, productive food systems under climate change.”
Instead of uniform monocultures, agroecological practices rely on a diversity of plant, animal and microorganisms to grow food and fibre in polycultures, genetic mixtures, agroforestry, and agro-sylvo-pastoral systems. When adopted at scale, they can eliminate the need to use energy intensive inputs such as nitrogen fertilisers by designing agroecosystems to include nitrogen-fixing plants, green manures, and crop rotations to enhance and manage soil fertility. Today, production and use of synthetic nitrogen (N) fertiliser accounts for roughly 21.5% of the annual direct GHG emissions from agriculture. Agroecological transformations reduce carbon footprints by re-localising production, processing and consumption within territories – for example by creating short food chains and local public procurement schemes with farmers to provide seasonal and nutritious food.
Agroecological practices not only help in cutting GHG emissions to the air (i.e. “doing less harm”), they also “repair the harm” by increasing the number and surface area of active carbon sinks, – for example by expanding agroforestry and storing large amounts of carbon in the soil and in woody plants by creating mosaics of agricultural areas and patches of wild biodiversity at multiple scales. Climate repair means taking carbon out of the air and storing it so that it cannot return there so easily.
Financing agroecological transformations for climate repair
Recognising that time is running out to cool the planet, the World Bank has identified finance as a key game changer to achieve food systems transformation. However, questions around who should give how much money to whom, – and for what kind of agri-food systems and governance regimes -, are highly contested and unresolved. My research points to at least seven ways agroecological transformations could be financed for just and sustainable agri-food systems:
1. Disinvest from industrial agri-food systems
Government public subsidies are hugely out of step with the need for climate repair. The public is currently providing more than US $1 million a minute in global farm subsidies, much of which is driving the climate crisis and destruction of wildlife. Just 1% of the US $700 billion a year given to farmers is used to benefit the environment. Most of this total subsidy instead promotes high-emission livestock production, forest destruction, and pollution from the overuse of fertiliser. Removing subsidy support that drives high-emitting industrialised food systems is key action for governments.
Financing reductions of GHG emissions from pre- and post-production processes is also a priority for disinvestment. All the links in globalised industrial agri-food chains rely on a highly energy intensive infrastructure that includes oil and gas production, shipping and road transport, mining, and internet technology. Banks and financial institutions can de-fund this supporting infrastructure to help reduce GHG emissions from food and agriculture.
Cooling the planet depends on massively redirecting financial support to re-localised agri-food systems based on short food chains and circular economy models. Funds and fiscal policies that support these systems would not only significantly decarbonise agri-food systems in the next five to ten years – they could also help re-invigorate local economies and create new livelihoods.
2. Fund agroecology R&D
Worldwide, agroecological research receives a minuscule percentage of the total public funding for agricultural research and development (R&D) – the lion’s share supports industrial agri-food. Strikingly, there is very little public R&D funding that supports agroecological approaches. The support that does go for R & D to more sustainable food systems has a more superficial focus on agroecological change based on substituting harmful inputs and practices with less degrading ones, but within essentially unchanged monocultures.
The climate emergency requires discontinuing R&D funding for industrial agri-food systems as well as an immediate and substantial increase in public funds for R&D support to the decentralised and democratic co-creation of agroecological practices by smallholder farmers, indigenous peoples, scientists, and consumer-citizens.
3. Redirect climate finance away from greenwashing and false solutions
The Glasgow Financial Alliance for Net Zero (GFANZ) was created to meet the enormous investment needs in achieving net zero – these could total over USD 100 trillion over the next three decades. However, most of the finance now being made available is to support mitigation measures. Much less funding has been earmarked for adaptation to climate change and tackling biodiversity loss. Dozens of big agri-business polluters are now making “net zero” pledges to access this funding. By pledging a mix of emissions reductions and carbon credits, companies are allowed to compensate for their emissions, including through nature‐based solutions (NbS), carbon offsets such as reforestation, and adoption of greener renewable energy systems. However, these corporate strategies are deeply problematic because offsetting GHG emissions against NbS elsewhere postpones the real reductions in emissions needed now and transfers responsibility for reducing emissions to the poorest countries. Corporate-led NbS are also triggering a massive new wave of land and resource grabs from local communities, mainly in the Global South.
There is an urgent need to re-distribute and redirect the COP’s climate finance away from damaging corporate ‘net-zero’ plans based on greenwashing and instead support agroecologically-based climate change adaptation and mitigation.
4. Fund transitions to low-meat diets and agroecological livestock production
The need to shift diets towards plant-based consumption is now widely emphasised to combat climate change and improve public health. Per unit of food consumed, meat and dairy have anywhere between 3 to 100 times the GHG emissions of plant-based foods, depending on where and how food is produced. Beef, for example, generates 6 to 30 times more emissions than tofu. Globally, livestock production – including animal rearing and feed production – produces between 11% and 17% of all anthropogenic greenhouse gas emissions. Mobilising finance for change depends on at least four actions:
- Redirect funding and subsidies to phase out fossil-fuel intensive livestock factory farming and to support instead the agroecological production of high-quality, nutrient-dense livestock products (meat, milk and eggs) and plant-based proteins.
- Rapidly restructure and re-localise pre- and post-livestock production processes and global supply chains within territories to reduce their disproportionately high GHG emissions.
- Reverse the gigantic corporate power of the meat and dairy industries which currently blocks the development of climate-friendly alternatives.
- Fund a long-term cultural shift away from high to low animal product consumption and towards vegetarian diets
5. Mobilise additional finance for climate repair and equity
Globally, there is plenty of money to go around. But funds and financial wealth need to be more equitably re-distributed between and within countries to limit the increase in global temperature within 1.5° or 2°C above pre-industrial levels. Government revenue generation through taxes and similar policy instruments should also aim to reduce the gross inequalities associated with GHG emissions in and between countries. The world’s richest 1% are set to have per capita consumption emissions in 2030 that are still 30 times higher than the global per capita level compatible with the 1.5°C goal of the Paris Agreement. Meanwhile, the carbon footprints of the poorest 50% of the world population are set to remain several times below that level. To live up to COP 29 declarations, governments could decide to:
- Tax global wealth. The EU Tax Observatory has called for a modest 2% annual levy on the wealthof the world’s richest individuals as the starting point for a global minimum tax. It estimates that this measure could raise $250bn (£197bn) a year from the world’s 2,769 billionaires, who together were worth $13tn in 2024 (EU Tax Observatory, 2024). A strengthened global minimum tax on multinational companies, free of loopholes, would raise an additional $250 billion per year. In other words, developing countries’ requirement for an additional US $500 billion annuallyto address the challenges of climate change could be fully met by these two fiscal reforms. This amount of public finance would make possible the large-scale approaches needed for adaptation to climate change and mitigation, including agroecological re-structuring for territory-based agri-food systems and socio-ecological resilience.
- Impose a rising global price or tax on GHG emissions. Rather than impose a one-size fits all tax, new taxes for climate repair will need to target social groups and activities that generate the largest share of GHG emissions. An easy win is to introduce taxes on the record-high windfall profits which agri-food corporations, the armaments industry, oil companies have made during the COVID-19 pandemic and the ongoing wars in Gaza, Sudan and Ukraine.
- Close down fiscal paradises and tax havens, and tax speculative financial markets. The recently proposed Wall Street speculation taxis expected to raise up to US $220 billion in the first year, or more than US $2.4 trillion in revenue over the next decade from wealthy investors.
- Use debt cancelation and reparation for slavery as means to generate substantial funds for climate action and other pressing issues in developing countries. Reparations for transatlantic chattel slavery could generate substantial funds for climate action and other pressing issues in countries whose peoples were subjected to a long history of colonial exploitation and gross violation of human rights.
6. Reduce military spending
Exceeding US$ 2.4 trillion in 2023, the rising costs of militarism are preventing progress on global priorities like sustainability transitions for agri-food systems that are needed for climate repair, biodiversity conservation, land restoration, and achieving the right to food for all Reducing and redirecting military spending are urgently needed to end the environmental and human devastation caused by the State-backed military-industrial complex that thrives on war.
7. Finance democracy for climate repair
History shows that governments have faced massive economic disruption—and often military coups—when their policies threaten the profits and privileges of corporations and the hyper-rich.
However, governments can decisively counteract the actions of powerful actors by mobilising finance to expand democracy and citizen participation in policy making. Deepening political democracy can help shield governments from the actions of the agri-food industry and its lobby groups. The following policy choices are crucial in this regard:
- Ensure that global food governance continues to be based on multilateral decision making by governments and not replaced by multi-stakeholder governance structures favoured by corporations and financial institutions.
- Dismantle investment agreements that boost unaccountable corporate power.
- Significantly reduce the political and economic power of the super-rich class. In their letter to the 2025 World Economic Forum, a group of millionaires told governmentsthat “Wealth is no longer simply about worth. It is about control. If you, our elected leaders, continue to neglect the crisis of wealth extremism, the fractured foundations of our hard-won democracies will face further harm….. The defence and special privilege of extreme wealth cannot continue. We must draw the line.This should not be difficult. There is a simple solution that can be delivered quickly. You must tax us, the super-rich”.
- Finance more inclusive and participatory democracy. Enabling bottom-up decision-making procedures based on decentralised citizens’ assemblies and more direct, face-to-face democracy is absolutely key for navigating the unchartered territory of massive climate change and its growing impacts. Agroecological transformations for climate repair and planetary healing require putting decentralised, distributed, and democratic decision-making at the heart of the financial architecture that underpins agri-food systems everywhere.
From Scarcity to Abundance: Where to from here?
In closing, it is noteworthy that most governments work on the assumption that there is a scarcity of funds rather than an abundance of money potentially available to tackle climate change and the larger polycrisis in which agri-food systems are centrally implicated. Like elephants in the room, very large pots of money in the financial system are ignored by decision-makers, – they are simply not considered as possible sources of funds for agroecological transitions to more just and sustainable agri-food systems. My research shows that huge ‘financial elephants’ in the room become more visible when connecting real-world detail and broad structural analysis. In turn, this points to how finance can be harnessed for territory-based agroecological transformations that significantly reduce GHG emissions, biodiversity loss, land degradation as well as reverse poverty and hunger.
A narrow policy focus on changing subsidies and/or increasing R&D budgets in discussions on how to finance large-scale agroecological transitions is no longer enough to tackle today’s planetary emergencies. Whilst crucially important, these framings of finance reform are both limited and constricting. They demand too little and ultimately support the status quo by deepening consolidated power in the dominant agri-food regime. Instead, this analysis suggests that discussions on how to finance agroecology need to be re-framed to focus less on financial scarcity and more on the possibilities of abundance. Now is the time to call out all the big ‘financial elephants in the room’ and make them work for justice and the well-being of human and non-human nature.
This blog is based on two fully referenced publications which further detail the arguments made here:
Pimbert, M.P. 2024. Financing Agroecological Transformations for Climate Repair CAWR Policy Brief, Coventry University.
Pimbert, M.P. 2025. Financing agroecological transformations for territorial agri-food systems. Beyond the myth of financial scarcity (submitted for publication).