Alvario Lario, President of the International Fund for Agricultural Development (IFAD), emphasized the importance of investing in rural economies to achieve food security and economic growth during a keynote speech at the World Governments Summit 2026, organized by the Arab Authority for Agricultural Investment and Development (AAAID). He highlighted that food systems in the Arab world are deeply interconnected, spanning high-tech urban supply chains and millions of small-scale farmers, pastoralists, and food artisans who continue to produce food using traditional methods.
Lario stressed that supporting small-scale farmers and rural enterprises strengthens rural economies, expands employment opportunities, and contributes to regional and global stability. While small-scale farmers produce a large share of national food supplies, they remain vulnerable to climate shocks, water shortages, and market volatility. Strategic investments in the “first mile” of food systems can deliver strong economic returns and enhance food security. IFAD’s impact assessments indicate that its investments have increased rural incomes by 34 percent, agricultural production by 35 percent, and market access by 34 percent over three years.
He cited Morocco as an example, where modern irrigation techniques reduced water use by 30 percent, increased yields by 25 percent, and boosted household incomes by 50 percent, demonstrating that efficient allocation and technology can generate rapid returns in water-stressed regions common across the Arab and Gulf states. Lario also linked rural investment to peace and stability, noting that IFAD’s experience in Ethiopia shows that every one percent increase in land productivity correlates with a three percent reduction in conflict.
Lario highlighted the importance of partnerships to maximize the impact of rural investments. The Arab region, with its strengths in finance, innovation, and South-South cooperation, is a strategic partner for IFAD in shaping sustainable food systems. Since 2000, IFAD has collaborated with AAAID, combining AAAID’s financial resources and regional mandate with IFAD’s expertise and grassroots networks to mobilize investments and scale impact. He noted that IFAD projects leverage donor contributions to generate domestic and private investments, with every US$1 of donor funding helping to unlock approximately US$6 in investments on the ground.
