FfD4: IFAD calls for smarter finance to boost rural growth and unlock 4.5 trillion dollars’ worth of opportunities in agrifood systems

As the international community gathers in Seville for the Fourth International Conference on Financing for Development (FfD4) amid rising geopolitical tensions, the International Fund for Agricultural Development (IFAD) is urging a fundamental rethink of how development is financed - with a focus on agrifood systems to boost rural growth through job creation and tap into 4.5 trillion dollars’ worth of business opportunities.

“Rural development, specifically rural jobs, is one of the areas with the highest return on investment in development today. Every dollar invested in sustainable agriculture can yield up to 16 dollars in returns. We must stop thinking of rural development as charity,” said Alvaro Lario, President of IFAD.

The numerous activities and opportunities along the ‘from farm to fork’ value chain are a pathway to create more jobs, enhance food security and help farmers adapt to climate change. Coordinated investment could create over 120 million rural jobs worldwide.

With an investment of approximately 0.5 per cent of the global gross domestic product, we could unlock business opportunities worth up to US$4.5 trillion a year by 2030, significantly boosting incomes among the poorest rural communities compared to other sectors. Yet food systems remain underfinanced.

As some development budgets shrink despite a massive US$4 trillion shortfall to finance development, IFAD demands a smarter and fairer financial system that delivers real impact, especially in the world’s rural areas, where 80 per cent of the world’s poorest live.

Smallholder farmers, herders, fishers, and Indigenous Peoples, who produce one-third of the world’s food, remain among the most vulnerable to poverty and ever-increasing extreme weather events. IFAD has shown that targeted investments in these communities deliver notable impact. Between 2019 and 2021, IFAD-supported projects reached over 77 million rural people, with participants reporting an average income increase of 10 per cent.

The Seville conference is a unique opportunity to reshape global finance and recommit to development as a strategic investment in global peace, prosperity, and planetary sustainability, according to IFAD’s president. “The solution isn’t always more money,” said Lario. “We need to reform the system to make better use of what we already have, with fairness, accountability, and a clear focus on impact.”

The Compromiso de Sevilla, outcome document of the conference, states the need to facilitate private investment in agriculture and food systems. “We need to make private capital work for rural development,” said Lario. “We must collectively address market failures and support private capital mobilization in a sustainable way.”

Through de-risking tools, blended finance and concessional lending, institutions like IFAD are already attracting private capital into scalable, coherent and viable high-impact rural investments, with interventions driven by results on the ground and not just financial perspectives.

Public development banks (PDBs), with over US$23 trillion in assets, are critical partners in reaching rural communities. However, many lack the tools to support small-scale producers. Through the AgriPDB Platform, co-led with France’s development agency, IFAD is helping build capacity to align efforts and investments with climate-resilient, inclusive food systems.

Remittances are another powerful and often overlooked financial flow. In 2024, migrant workers sent US$685 billion to their home countries, surpassing both official aid and foreign direct investment; approximately one-third of these flows went to rural areas.

For 76 countries, remittances are a vital financial inflow. In 30 of these, remittances represent over 10 per cent of GDP. IFAD is advocating for lower transaction costs, better financial inclusion, and national policies that integrate remittances and diaspora investment into development strategies. IFAD has financed over 75 remittance-related projects in more than 50 countries. These projects have supported more than 1.8 million people in accessing financial education, new financial products and services, and access or benefit from diaspora investments.