Inter-American Institute for Cooperation on Agriculture

Agriculture

Without smart financing, there is no transformation: the other side of tropical agriculture

Tiempo de lectura: 3 mins.

Carlos Ernesto Rodríguez Gómez, head of intelligence at Trust Funds for Agriculture (FIRA).

Tapachula, Mexico, 8 May 2026 (IICA). Behind many of the current debates on tropical agriculture —regarding productivity, sustainability, innovation— there is a variable that is becoming increasingly important, although it does not always feature prominently in the discussions: financing. Factors such as the way in which it is allocated, and the incentives and conditions involved, are becoming crucial.

This was one of the key issues addressed at the recent meeting on tropical agriculture held in Tapachula, Chiapas, where specialists and stakeholders analyzed not only production challenges, but also the economic conditions that can speed up —or hinder— changes on the ground. The event, entitled “Sustainable, Inclusive, and Competitive Tropical Agriculture: A Critical Path for Mexico and the Americas,” was organized by the Government of the State of Chiapas and its Ministry of Agriculture, along with the Inter-American Institute for Cooperation on Agriculture (IICA) and the Tropical Agricultural Research and Higher Education Center (CATIE).

Behind concepts like resilience and sustainability, a more profound change is taking shape whose impact is being felt within the financial system. It is no longer simply a question of producing more or producing better, but of demonstrating how production takes place, with what impact, and under what conditions.

“The challenge is to produce with resilience, demonstrate sustainability, and generate greater market value,” said Carlos Ernesto Rodríguez Gómez, head of intelligence at Trust Funds for Agriculture (FIRA), in summarizing the new equation facing the sector.

This change is significant. As Rodríguez Gómez explained, financial systems are beginning to incorporate environmental variables into their risk assessments, which modifies the way in which credit is allocated. Soil degradation, for example, is no longer just an agronomic problem: it is beginning to be reflected as a depreciation of productive assets.

“Degraded land is being viewed as high-risk,” the FIRA specialist pointed out, noting that these factors are beginning to impact balance sheets and financing decisions.

In this new scenario, one of the concepts that is becoming increasingly important is traceability. It is not enough to simply adopt sustainable practices: it must be possible to measure them, verify them, and translate them into useful information for the financial system and the markets.

“Sustainability has to be demonstrable,” Rodríguez Gómez contended, anticipating a trend that is already becoming a feature of markets in Europe and elsewhere, where detailed information is required not only from the producer, but from the entire value chain.

From the perspective presented by the FIRA at the meeting, the future competitiveness of the sector will depend on the ability to integrate three dimensions: innovation, traceability and smart financing.

In addition to his appraisal, Rodríguez Gómez detailed some concrete tools designed to speed up the transition. One of them is Agritec, a platform of digital services for producers —from climate information to satellite monitoring—, which aims to reduce barriers to access to innovation.

Another is ProSostenible, a scheme that links credit with sustainable production practices through financial incentives, allowing access to better financing conditions for those who adopt certain standards.

But perhaps the most illustrative example is SustentaMás, a program that aims to reduce the use of chemical fertilizers through an incentive scheme aligned throughout the chain.

The mechanism combines compensation to financial intermediaries, credit guarantees, and the provision of bio-inputs to producers, with the aim of facilitating the transition without affecting profitability in the short term, the official explained.

“The initial results are encouraging,” he noted. According to data presented during the meeting, the model is already being applied to some 20,000 hectares of crops such as wheat, corn, and sorghum, reducing fertilizer use by 15-30 percent.

One of the key points of this approach is that it is not limited to the producer, but involves the entire value chain. The idea, as explained in the presentation, is that transformation is only scalable if the incentives for those who produce, finance, and buy products are aligned.

This means working on strengthening supply chains, securing markets, and creating conditions that reduce uncertainty. It also calls for a change of approach with regard to profitability, incorporating long-term stability as a key factor, especially in systems more exposed to climate risks.

In this context, tools such as green bonds, credits linked to environmental metrics or carbon markets, are beginning to emerge, which could open up new opportunities for the sector.

The case presented by the FIRA shows that the transformation of tropical agriculture depends not only on new technologies or production practices. It also involves changes in the mechanisms that sustain the system economically.

In this regard, sustainability is beginning to emerge not only as a goal, but as an increasingly necessary condition for accessing financing and markets.

More information:
Institutional Communication Division.
comunicacion.institucional@iica.int

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