The United Nations Food Systems Summit in October 2021 already pointed out that any necessary transformation of food systems must pay particular attention to the impact on the poorest people, smallholders in rural areas, women and young people.

It also showed how climate change, conflict, and the global economic system necessitate adjustments so that more people can find their way out of poverty in the first place and become more resilient to crises.

In its 2021 Rural Development Report, IFAD makes a clear case for a more intensive focus on local businesses. This would enable smallholder farmers, who today produce most of the food for the world's population, to lift themselves out of poverty and process, store and market food themselves.

Governments could do a lot:

• set the right incentives,
  
• create more opportunities for small and medium-sized economic actors,
• encourage innovation,
  
• strengthen pricing systems, that better reflect real production costs (i.e., including environmental benefits and costs),
• help compensate for market deficits, and
• forge more partnerships with civil society, the private sector, academia, and rural representatives.

More employment opportunities would need to be created in small and medium-sized enterprises (SMEs) in the food sector.

More investment is needed to make small farms more profitable and productive.

More attention needs to be paid to social protection measures that promote healthier diets and give poor people and women in particular more opportunities to earn a living and become more economically independent.

“Transforming food systems will challenge established assumptions, mindsets, procedures, political and economic interests, and power relations. Deep policy reform and substantial investment will be needed.” (IFAD Rural Development Report 2021)

The report and additional information are available online at www.ifad.org/en/rural-development-report/ .

Background information

The Rural Development 2021 report was prepared by IFAD in close collaboration with Wageningen University over a two-year period.

The report describes the systemic problems that have led to our current situation, identifies priorities for transforming our food systems, and recommends actions for sustainable change.

With the huge increase in wheat prices, due in part to the war in Ukraine, and the resulting impact on many developing countries and the poor in those countries, the functioning of food systems is once again coming into focus.

The report provides detailed analysis and policy recommendations on these and many other areas, including balanced diets, food loss and waste, food processing, and specifically animal processing.

It also presents new results from quantitative global modeling that simulates the consequences of different types of transformative change on a range of environmental, social, economic, and nutritional indicators.