Investment opportunities for climate-smart agrifood tech in Kazakhstan and the Kyrgyz Republic

EBRD and FAO’s Finance and Technology Transfer Centre for Climate Change (FINTECC) programme developed the reports, which are funded by the Global Environment Facility (GEF).

The two institutions highlight in the reports, opportunities for investment in selected crop-farming technologies and practices – including conservation agriculture, drip irrigation, pasture improvement, and precision agriculture – to stimulate economic growth and advance climate change mitigation and adaptation.

These practices come at lower cost compared to other climate technologies and practices, while supporting adaptation goals. The findings can guide policy-makers and inform public and private institutions towards investments in greening the agrifood sector. The FINTECC partners collaborated to develop a practical rapid assessment methodology to identify and prioritize climate technologies and practices in the agrifood sector, based on their potential to mitigate greenhouse gas emissions, support climate change adaptation, and contribute to economic development.

 “The aim of the research was to identify key climate technologies and practices which mitigate greenhouse gases, demonstrate good economic and environmental performance, and do not face major barriers to adoption. These constitute ‘low-hanging fruits’ for producers and small and medium sized enterprises as well as for investors and policy-makers,” said Nuno Santos, FAO economist, co-author of the studies.

The methodology wasfirst applied in Morocco in 2015–2016. During 2017–2018, the revised methodology was applied in Kazakhstan and Kyrgyzstan.

Agrifood systems: reducing emissions and building resilience

Agrifood systems are major contributors to greenhouse gas emissions and are increasingly under pressure to become more resource-efficient. The sector also faces increasing threats from climate change, due to its dependence on natural resources.

Addressing climate change mitigation and adaptation challenges in the agrifood sector requires radical changes in food production systems. Targeted investments in agrifood systems are urgently needed to decrease emissions whilst improving food security through increasing resilience to extreme weather events. Accelerating the adoption of climate smart technologies and practices is an essential element of this transition towards more sustainable food systems.

“We highlight opportunities and challenges to invest in the most promising climate technologies and practices to the required scale,” said Maria del Mar Polo, agricultural economist at FAO Food Systems and Food Safety, co-author of the reports. “For some technologies such as drip irrigation, or pasture improvement, regulatory frameworks must be strengthened. In other cases, the private sector must be made aware of the promising technologies, and supported technically to encourage adoption.”

Opportunities for climate-smart investments

The study weighed up 11 agrifood technologies and practices – grouped under crop farming, livestock, renewables and energy efficient technologies in the Kyrgyz Republic and Kazakhstan - and developed an overall ranking by considering their mitigation and adaptation potential as well as financial viability.  

Pasture improvement practices – including rotational grazing, infrastructure rehabilitation and maintenance – can lead to mitigation benefits through increasing soil carbon sequestration. These practices also bring adaptation benefits, such as higher pasture and livestock yields, and improved resilience to temperature and water stress, through reducing soil erosion.

Similarly, conservation agriculture brings mitigation and adaptation co-benefits through reducing greenhouse gas emissions and increasing agricultural production and crop resilience as a result of soil quality improvements.

“Climate-smart technologies and practices present opportunities for addressing climate change challenges, stimulating economic growth and promoting sustainable development within the food and agricultural systems in Kazakhstan and the Kyrgyz Republic,” said Gianpiero Nacci, Deputy Director, Energy Efficiency and Climate Change, EBRD.

The reports advocate for private sector investment in improved greenhouses, precision agriculture, drip irrigation, improved livestock production and conservation agriculture, which provide high rates of return and shorter payback periods. Financial support – in the form of matching grants or concessionary lending – should focus on those technologies that are less attractive from a purely private sector perspective, despite their large mitigation and adaptation benefits.

The reports also call for crucial state support to agricultural finance, innovation and knowledge management, and public investments in agricultural research. Further examination of the barriers to deployment faced by these technologies will help identify opportunities for policy enhancement.