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Statement by IFAD President Kanayo F. Nwanze at "Finance for Food: Investing in agriculture for a sustainable future", Expo Milan

Location: Milan Italy

15 October 2015

Esteemed colleagues, 
Ladies and gentlemen,

For years I have said that farming at any scale is first and foremost a business. And for many of those years, I felt like a lone voice in the wilderness. Today, that has changed.

This meeting of Multilateral Development Banks and partners reflects the growing recognition that small-scale producers – women and men – and rural enterprises are genuine businesses, and that we must channel investment into them.

The needs are huge. The world's 500 million small farms collectively are the biggest direct investors in agriculture, but they operate with a huge handicap. Consider that more than 2 billion people are entirely excluded from the formal financial system. And most of these 2 billion live in the rural areas of developing countries. Consider that they are the main producers of food in developing countries. Yet paradoxically, and tragically, they are the ones who go hungry.

Increasingly, they have access to microfinance, but microfinance alone will not meet all the investment needs of smallholders and rural Small and Medium Enterprises.

In order for smallholders and small rural enterprises to invest in and grow their businesses, they will need access to larger and more diversified products.

At IFAD, we see every day that when policies, technologies and investments are directed towards the financial inclusion of smallholders, the results are very impressive: greater productivity, higher incomes, better food security and nutrition and better social cohesion.

The agri-food sector already represents $5 trillion, and investments in the sector are growing rapidly. It holds tremendous promise for producers in developing countries.

But as we continue with our discussions today, let us be clear that the growing global food sector will only meet its promise of ending hunger and poverty if smallholders are treated as partners, and not charity cases waiting for handouts.

Business relationships need to be equitable and transparent. And we need to ensure that smallholders, especially women, are not excluded, exploited or otherwise marginalised from business opportunities. 

Without this, our vows to end poverty and hunger will be worth no more than the paper on which they are written.

Ladies and gentlemen,

 I am particularly gratified that IFAD is co-hosting this event in partnership with the Ministry of the Economy and Finance of Italy, in the presence of the President of the Italian Republic.  Italy's leading role in the agricultural sector and in multilateralism pre-date the establishment of FAO 70 years ago.

It is no coincidence that the three food and agriculture United Nations agencies are in Italy. And that the only IFI in the UN system with the exclusive mandate to focus on rural transformation, IFAD, is headquartered here in Rome. I see today's event as the further strengthening of the robust partnership and engagement between IFAD and the Italian Ministry of Economy and Finance.

I hope that today's discussions will be a starting point for productive collaboration among the MDBs, governments and the private sector. Together, we can build on promising innovations in finance and bring them to smallholders and small rural enterprises.

IFAD stands ready to work with all partners gathered here and to take initiatives forward over the coming months and years.

Thank you.