The level of investment in agriculture is positively correlated with production growth, poverty reduction and food security. Regrettably, the evidence shows a declining trend over the last decades on the levels of agricultural investment in developing countries, notably public spending and overseas development aid. FAO estimates that 83 billion dollars per year of additional investments in food, agriculture and rural development are required for the world to feed its growing population in 2050 – in other words, investment needs to rise by 50 percent.

Many developing countries are making strenuous efforts to attract and facilitate foreign investment into their agriculture sectors. For them, foreign direct investment (FDI) is seen as a potentially important contributor to filling the investment gap and providing developmental benefits, for example through technology transfer, employment creation and infrastructure development. Whether these potential developmental benefits are actually likely to be realized is a key concern, as FDI has also the potential to harm host countries. Care must be taken in the selection and formulation of business models that are capable of meeting the needs of both host countries and investors. In addition, appropriate policy and regulatory frameworks need to be in place to ensure that development benefits are maximized and the risks minimized. FAO promotes responsible investment in agriculture, including building international consensus on Principles for Responsible Agricultural Investment (RAI Principles).