Private Sector Investment in a Changing Climate

Overview

The Private Sector Investment in a Changing Climate: Resilient Rice Value Chain Development in Uganda (PSI-Climate) initiative explored how domestic private sector investment decisions can enable climate risk management by different actors along the rice value chain in Uganda. The initiative specifically focused on rice value chains because rice is one of the priority crops for achieving food security and improves household income, as stipulated in the National Rice Development Strategy 2008-2018.

The research was conducted through two case studies. The first case study focused on domestic private investments in quality rice seeds (including climate-resilient seeds) in Northern Uganda in partnership with a domestic seed company, Equator Seeds. The second focused on investments in financial products by a commercial bank, the Centenary Bank, in Eastern Uganda. Data collection in both cases was based on focus group discussions, interviews and dialogue processes with key actors along the selected rice value chains, as well as engagement with relevant experts.

The initiative was led by the International Institute for Sustainable Development (IISD) and implemented in partnership with the Economic Policy Research Center (EPRC) and the Ministry of Finance, Planning and Economic Development (MoFPED) during the period 2014- 2016.

Purpose and objectives

The PSI-Climate initiative aimed to help small and medium-sized enterprises (SMEs) and commercial banks make more informed decisions that lead to more sustainable outcomes. It also endeavoured to assist public sector actors with the development of policies and strategies that encourage private sector investment that promotes climate risk management along the rice value chains. The overarching research question for the project was: how can domestic private sector investments support climate risk management along agricultural value chains in Uganda?

Funding

The financial support for the initative was provided by the International Development Research Centre.

The overall approach for the PSI-Climate project consisted of six key steps:

1. Engagement, context setting and communications to identify case studies, secure ownership and support of key actors, and develop a communication strategy
2. Climate analysis to analyse the impacts of climate variability and change at each level of the selected rice value chains (from production to consumption)
3. Private investment impact analysis to understand the benefits and/or constraints associated with specific private investments at each level of the selected value chains and to assess how these benefits support or constrain the management of climate risks along the value chains
4. Identification of options for improving climate risk management along the value chains and maximizing the climate risk management benefits of domestic private investment
5. Prioritization of options identified in step 4 against decision-making criteria of key actors along the value chains and to determine what option, or combination of options, will be most robust to support climate risk management along the selected value chains
6. Policy analysis to identify policy incentives for businesses to support climate risk management along agricultural value chains

News Links

Public private partnerships could ease the risks of climate change on agriculture

Blog Links

Expanding private sector investment in agriculture value chains and climate change