Bilateral climate finance and food security in developing countries: A look at German donations to Sub-Saharan Africa

This study seeks to assess whether the German bilateral climate finance (GCF)
geared toward the agriculture sector of 35 SSA countries is helping achieve food
security. In measuring food security, the study employed principal component
analysis to generate an index for all four food security dimensions proposed by
FAOSTAT-food
availability, access, stability, and utilization. A general composite
food security index was also generated. System-GMM
was used to estimate the
influence of GCF on all the food security components. The findings show that
GCF improves food availability and general food security in SSA, but government
expenditure is inadequate to do so. It was also found that agricultural technology
or capacity moderates the effect of GCF on food availability and overall food security.
Based on the findings of the study, it is clear that bilateral climate finance
flow invested in agricultural technology coupled with an increase in government
agricultural expenditure from the current 6% to 10% as proposed by the Malabo
declaration will put SSA on a path to achieving food security. It is recommended
that SSA countries deepen incentives to attract FDI inflows to the region due to
its role in improving food security via food access.
KEYWORDS
food security, German bilateral climate finance, principal component analysis, Sub-Saharan
Africa.