By Lynda Kiernan
The Food Securities Fund has secured $15 million in capital commitments from the Global Environment Facility (GEF) Council.
Developed by Clarmondial in collaboration with Duff & Phelps (Luxembourg) Management Company S.A.R.L., Pictet Asset Services and Allen & Overy, and launched in late 2016, the Food Securities Fund is a novel blended finance vehicle designed to be an answer to the gap for affordable finance in established value chains.
The open-ended, AIFMD-compliant fund acts as a scalable, commercial, fixed income product and serves as an affordable credit channel to responsible producers committed to ESG-based practices.
“We are excited to launch this product, which links investors interested in sustainable agriculture investing and fixed income with the financing need of value chain stakeholders working with smallholder farmers to promote rural economic development, food security and climate smart agriculture,” said Tanja Havemann, director and founder of Clarmondial AG, in a November 2016 release announcing the launch of the fund.
Clarmondial had significant and quantifiable impact in mind with the launch of the Food Securities Fund, which through its innovative value chain finance approach will target five goals:
~ To positively impact the lives of farmers, especially smallholders and women;
~ To support local SMEs in growing their employee numbers and enriching their training, especially for women and youth;
~ To support the restoration of agricultural land;
~ To implement sustainable agricultural practices; and
~ To mitigate greenhouse gas emissions.
In recognition of the fund’s alignment with GEF’s focus on land degradation, biodiversity, and climate change mitigation, the GEF Council has approved a commitment of $15 million to the fund with Conservation International acting as its agency.
“The Global Environment Facility and Conservation International will provide critical support to the Food Securities Fund. Their commitment highlights the social and environmental credentials of the Fund,” said Fred Werneck, co-founder, Clarmondial.
This commitment follows upon the 56th GEF Council meeting held in Washington DC in June 2019, during which governments approved $1 billion in initiatives that will support vulnerable populations combat and adapt to climate change, and which will bring 608,509 hectares of land into climate-resilient management, according to the Council.
“The Global Environment Facility is pleased to support this innovative blended finance strategy that demonstrates the opportunity to mobilize private sector capital at scale for urgent environmental issues,” said Gustavo Fonseca, director of programs, Global Environment Facility.
– Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.
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