Is Climate Finance Helping Stabilise Food Prices in Sub-Saharan Africa?

Abstract

This study explores the potential impact of climate finance (cf) on food
prices in Sub-Saharan Africa (SSA) as climate change continues to create
food scarcity and increase food prices. The study analyses data from
43 SSA countries between 2006 and 2018 using a panel fixed effect model
with Driscoll-Kraay standard errors and methods of moments quantile regressions
(MMQR). The findings indicate that countries in SSA that receive
more cf, improve their fight against corruption, have good rainfall patterns,
experience reduced extreme temperatures, have depreciated currencies,
larger populations and higher GDP growth, reduce food imports, increase
domestic food supply, and demonstrate high governance and social
readiness are likely to experience stable or reduced food prices. Based on
these results, the study recommends that SSA governments prioritise anticorruption
efforts to earn donor trust and increase CF, ultimately leading
to lower food prices in the sub-region. Further, the findings indicate
that good rainfall patterns reduce food prices: this shows the need for SSA
countries to invest in policies that lead to reliablewater supply as irrigation.