Bilateral climate finance and food security in developing countries: A look at German donations to Sub‐Saharan Africa

Abstract This study seeks to assess whether the German bilateral climate finance (GCF) geared toward the agriculture sector of 35 SSA countries is helping achieve food security. In measuring food security, the study employed principal component analysis to generate an index for all four food security dimensions proposed by FAOSTAT‐food availability, access, stability, and utilization. A general composite food security index was also generated. System‐GMM was used to estimate the influence of GCF on all the food security components. The findings show that GCF improves food availability and general food security in SSA, but government expenditure is inadequate to do so. It was also found that agricultural technology or capacity moderates the effect of GCF on food availability and overall food security. Based on the findings of the study, it is clear that bilateral climate finance flow invested in agricultural technology coupled with an increase in government agricultural expenditure from the current 6% to 10% as proposed by the Malabo declaration will put SSA on a path to achieving food security. It is recommended that SSA countries deepen incentives to attract FDI inflows to the region due to its role in improving food security via food access.