Regional UN forum steps up efforts for financing for sustainable agricultural mechanization


In Jeonju, Republic of Korea, policymakers, academics and researchers, farmers organizations, private sector and industry association representatives from across the Asia-Pacific region concluded a regional forum underscoring the need to boost investments in mechanization-based solutions for resilient agricultural on 27-29 November, 2019.

The 7th Regional Forum on Sustainable Agricultural Mechanization in Asia and the Pacific also discussed innovative approaches to increase financial inclusion among smallholder farmers as well as how these approaches can be adapted to local needs of different countries in the region. The Forum was organized by the Centre for Sustainable Agricultural Mechanization (CSAM) of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) in collaboration with the National Institute of Agricultural Sciences of the Rural Development Administration, Republic of Korea.

"CSAM provides a platform for ESCAP member States and stakeholders in the region to exchange knowledge and identify solutions for the promotion of sustainable agricultural mechanization. At this year’s Forum, the focus on financing opportunities aims to give improved access to smallholder farmers to the technologies that can improve their livelihoods and boost food production. In this way we can contribute to poverty reduction and food security, and support progress towards the 2030 Agenda for Sustainable Development in the Asia-Pacific region,” said Ms. Li Yutong, Head of CSAM.

The lack of access to financing for suitable machinery and equipment is one of the key constraints to inclusive and balanced sustainable agricultural mechanization development, particularly in rural areas of the region’s developing countries. Given information asymmetries and lack of confidence in receiving timely repayments, investors or providers of financial services often impose high interest rates, require substantial collateral and restrict lending to those with sound financial standing or proven track records of repayments. However, such practices pose limitations and usually exclude the poorest farmers, including smallholders and women farmers due to lack of collateral and sensitivity to interest rates.

Sustainable agricultural mechanization can play a key role in addressing the economic, social and environmental dimensions of sustainable agricultural development. It can help in increasing agricultural productivity, reducing the drudgery of agricultural work, enhancing climate-resilience, and combating land degradation. Making more sustainable and appropriate machinery available to the millions of smallholder farmers, who are the main contributors to food production in the region, contributes towards achieving Sustainable Development Goal (SDG) 1: No Poverty and SDG 2: Zero Hunger.

The Regional Forum is held annually with the aim to promote high-level policy dialogue and regional cooperation on relevant shared or emerging issues of member countries in Asia and the Pacific. Since 2013, six Regional Forums have been successfully organized and have facilitated active discussions on the topics of public-private partnerships, custom hiring and machinery rental practices, human resource development, climate-smart mechanization, sustainable agricultural mechanization strategy, and creating enabling environments for the private sector.