Countries face a series of crises that pose a risk to food security, a senior UN official has said.
Kaveh Zahedi, director of the office of climate change, biodiversity and environment at the Food and Agriculture Organisation, said countries had barely recovered from the coronavirus pandemic before a cost-of-living crisis hit and contributed to the fact 700 million people globally now face food insecurity.
Mr Zahedi told The National on Monday the situation was was being made worse by climate change and, when combined, these issues were “undermining hard-won development gains”.
It scares me. It is going to be hard to live in a number of countries. It is going to be too hot
Kaveh Zahedi,
director of FAO's office climate change, biodiversity and environment
“I don’t think you can separate the food crisis from the climate crisis or food security from climate solutions,” said Mr Zahedi. “They are absolutely intertwined.”
Last week, the UAE’s Cop28 presidency said agriculture and food production would take centre stage at the climate summit in Dubai from November 30 to December 12.
Mariam Al Mheiri, Minister for Climate Change and Environment, said it was the “strongest push ever given to food systems and agriculture in the Cop process” and came on the same day that UN Secretary General Antonio Guterres said food systems were “broken”.
Mr Zahedi said food systems can be part of the solution and not only in cutting emissions but boosting resilience, ensuring access to food and allowing farmers on the front lines of the crisis to adapt to a changing climate.
Crisis is growing due to droughts, floods and heatwaves
There was not one global threat to food security but an array of factors – from supply chains to conflict to governance – with climate change now intensifying the crisis because of droughts, floods and heatwaves, and with water scarcity and biodiversity loss compounding the issue, he added.
But he said the FAO was keen to focus on solutions such as the power of regenerative agriculture and soil restoration that can help farmers to adapt and cut emissions.
“If you look at the narrative around climate and agriculture, it is always that [the sector is responsible for] 30 per cent of greenhouse gas emissions,” he said.
“It is always the problem statement. You don’t see that solution orientation [such as] addressing the fact a third of agricultural land is degraded.
“What happens if we invest in bringing that back to health? That’s what we will take into Cop28.”
Finance remains a significant barrier
Mr Zahedi said finance is one of biggest barriers to addressing these issues.
It was crucial, he said, for countries to deliver on the long-promised $100 billion a year climate finance pledge agreed to in 2009 and funding the loss and damage facility established last year at Cop27.
“Where are those losses and damages most being felt? Probably the smallholders; people living on the margins and the most vulnerable. We are not going to solve the food system agenda in a meeting room,” he said.
“[But] countries can’t do it alone. Of course, we need much more than $100 billion. But signals are important.”
Waking up to the problems
Aside from the Cop28 presidency’s focus on the issue, he said there was a “real awakening” taking place regarding the role of food systems in the official negotiations.
Food systems and agriculture, for example, were highlighted in the Cop27 closing decision text.
“It hasn’t always been seen as a central part,” he said.
“The focus has so often been on energy but without [food systems solutions], we are not going to solve climate change.”
The scale of the challenge was laid bare in the recent Intergovernmental Panel on Climate Change report that showed how off track the world was in trying to address climate change.
“There was a throwaway line which shocked me,” Mr Zahedi said.
“It said under many of the scenarios, rain-fed agriculture would be no longer possible in large parts of Africa and South America. Can you imagine what kind of transformation you would need to cope with that?”
Despite the often bleak picture, Mr Zahedi said he was optimistic about the issue, particularly how the UAE presidency was “positioning” food and agriculture in the climate conversation.
Much like Cop27, Cop28 will have a pavilion dedicated to food systems and agriculture hosted by FAO, the International Fund for Agricultural Development, the Consultative Group on International Agricultural Research and the Rockefeller Foundation, where the focus will be on solutions such as drought resilience, regenerative agriculture, and tackling food loss and waste.
“It is extraordinary that a third of our food goes nowhere,” he said.
“That is a waste of water, energy and everything.”
When asked how the public can be galvanised into action, he said everyone is interested in having a liveable planet but the world was moving away from that.
“It scares me,” he said. “Why should people care? It is going to be hard to live in a number of countries. It is going to be too hot.
“Food is going to be unpredictable. It is an existential issue.”
Climate tipping points – in pictures
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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What is the definition of an SME?
SMEs in the UAE are defined by the number of employees, annual turnover and sector. For example, a “small company” in the services industry has six to 50 employees with a turnover of more than Dh2 million up to Dh20m, while in the manufacturing industry the requirements are 10 to 100 employees with a turnover of more than Dh3m up to Dh50m, according to Dubai SME, an agency of the Department of Economic Development.
A “medium-sized company” can either have staff of 51 to 200 employees or 101 to 250 employees, and a turnover less than or equal to Dh200m or Dh250m, again depending on whether the business is in the trading, manufacturing or services sectors.
Checks continue
A High Court judge issued an interim order on Friday suspending a decision by Agriculture Minister Edwin Poots to direct a stop to Brexit agri-food checks at Northern Ireland ports.
Mr Justice Colton said he was making the temporary direction until a judicial review of the minister's unilateral action this week to order a halt to port checks that are required under the Northern Ireland Protocol.
Civil servants have yet to implement the instruction, pending legal clarity on their obligations, and checks are continuing.
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