The Road to the SDGs

PURPOSE X Although MCs agricultural production has been relatively small, their agricultural exports have increased from US$ 33.5 billion (6.7% of global exports) in 1995 to US$ 110 billion (8% of global exports) in 2016. Imports have also risen from US$ 38 billion (7.3% of global imports) to US$ 155 billion (11.1% of global imports) over the same period. These figures indicate that MCs are active in global agricultural trade, albeit with a small share, more as importers than exporters. IsDB is now developing a Sovereign Agriculture Trade Fund that will support MCs to increase their shares in agricultural global trade. X The objective of the Fund is to support MCs’ agricultural development through trade financing, with the aim to: – Improve the competitiveness of MCs’ agricultural commodities and enhance their market share – Enhance inter-regional trade among MCs for improved food security – Provide alternative financing for the priority agricultural value chains identified in IsDB Group MCPSs. METHOD X Based on the GVC business model, the new MCPS 2.0 has been developed on the principle of “making markets work for development”. This means a greater integration of MCs into GVCs as well as the catalysation of markets to finance projects leading to this integration. Trade is emerging at the beginning and end of the GVCs and is therefore a pivotal segment to unleash the growth of MCs’ participation in global markets. X The Sovereign Agriculture Trade Fund will invest in agriculture-related trade finance, structured trade and supply chain financing assets of sovereign or semi- sovereign entities. X The Fund will focus on supporting trade finance of strategic commodities and production inputs (including machinery) where MCs have revealed global comparative advantage. X In its Global Agri-food Industry Report, IsDB has identified five key priority commodities, namely cocoa, palm oil, rice, fisheries and poultry. In addition, there are several other agricultural commodities of many MCs that are already connected to GVCs, including livestock, wheat, sugarcane, G lobal trade of agricultural products has significantly risen over the past four decades Since 1995, when the World Trade Organization was established, global agri-food trade has more than doubled, reaching US$1.5 trillion in 2018. IsDB-ITFC Sovereign Agriculture Trade Fund The Fund will support the trade of the strategic agricultural commodities identified under IsDB’s Agriculture and Rural Development Sector Policy/Strategy and Global Agri-food Industry Report [ 78 ] SDGs