As Publisher

This Learning Brief offers a clear justification for the role of development assistance organizations like USAID in catalyzing private finance for climate action. It synthesizes lessons learned from a broad set of donor experiences and offers
practical ‘how to’ descriptions of donor-supported activities that lead to additionality and positive climate and human impacts.This is one of three complementary resources that includes a set of case studies that examine various models of blended finance for climate action and a guidance note that provides a framework for understanding the potential for additionality and human impacts for blended finance from USAID’s perspective.

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"Smallholder farmers around the globe are facing unstable productivity due to changing climate and weather patterns. The ways in which the private sector supports these farmers to build resilience to climate change and/or engage in efforts to mitigate climate change can have significant impact on the ability for farmers to make a living, the security of supply of smallholder crops, and the reputation of the private sector actors drawing loyalty of end consumers and investors.

As part of an effort to better engage the private sector in climate smart agriculture activities the Learning Community for Supply Chain Resilience, funded by USAID's Feed the Future program and in support of the Alliance for Resilient Coffee (ARC), interviewed 18 coffee companies to better understand how they think about climate risk and climate smart agriculture, the types of activities in which they engage, and the types of climate information they use and/or need. The results of this study are supplemented by results from a case study of Ugandan coffee companies, illustrating how their use of and need for climate information differs at the national level. The results give insight into the types of information that private sector companies are looking for to be able to design and implement effective climate smart agriculture programs. It also yields some insight on information and tools that would facilitate sector-level strategies."

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"Risk is an inherent feature of agriculture around the globe. The ever-present uncertainties in weather, yields, prices, government policies, global markets, and other factors can cause high volatility in farm income. In developing countries, smallholder farmers (and other small enterprises within the value chain) often do not have access to risk management products such as insurance to protect themselves from shock. Key barriers to the development of insurance markets in developing countries include: lack of awareness and understanding about insurance among households, high overhead costs associated with data collection and claims processing, and the limited availability of insurance products that meet the needs of poor and low-income farmers.

The use of digital tools in agricultural insurance has the potential to facilitate client uptake, reduce transaction costs, improve efficiency of the insurance process, and increase household resilience to respond to external shocks while ensuring stability, growth, and sustainability of agricultural value chains. Technology has its shortcomings, and the use of digital tools alone will not be sufficient to increase access to affordable, quality agricultural insurance for smallholder farmers. However, when strategically and thoughtfully inserted into existing Feed the Future programs, technology has the potential to accelerate and amplify USAID investments in sustainable agriculture and food security."

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"USAID's Partnering to Accelerate Entrepreneurship (PACE) initiative aims to catalyze private sector investment into early-stage enterprises and help entrepreneurs bridge the pioneer gap - thus unlocking the potential of thousands of promising enterprises around the world. Working in partnership with more than 40 incubators, accelerators, and seed-stage impact investors, USAID creates public-private partnerships dedicated to testing ways to help entrepreneurs overcome barriers to growth. These partnerships are expected to leverage $145 million1 in combined public and private investments over their lifetime."

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"Many of the available developmental evaluation resources focus on theory rather than practical experience. The DEPA-MERL consortium has documented early lessons learned from its experience and is pleased to offer guidance for organizations, managers, and evaluators that seek to implement this approach."

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