In this interview, learn how Norway is advancing food systems transformation through innovative finance, strategic partnerships and its leadership in donor coordination.
Anders Aabo
Senior Adviser, Department for Climate, Nature and the Private Sector, Section for Food, Norad
Anders Aabo is the Senior Adviser in the Department for Climate, Nature and the Private Sector, Section for Food, at the Norwegian Agency for Development Cooperation (Norad).
GDPRD/Michelle Tang: Norway plays a key role in development finance, particularly through initiatives like the Financing for Agri-SMEs in Africa (FASA). How does such a programme align with Norway’s broader priorities in agrifood systems and rural development?
Norad/Anders Aabo: It is great hear that Norway is recognized as playing a key role in development finance and rural development. That definitely aligns with our ambitions. Combating food insecurity is a key development priority for Norway. Practically speaking, this means we focus on supporting smallholder farmers, helping them achieve greater efficiency and productivity on their farms, integrating them into well-functioning value chains, and strengthening the markets they sell to. Traditionally, we have a very strong focus on smallholders, but we know it is also very challenging and costly to engage directly with this target group.
More recently, we have shifted toward creating stronger partnerships, enabling private sector growth and mobilizing more capital to invest in the food sector. This is where our focus on agri-SMEs fits in. These businesses are the critical connector between the farmer, rural development and the broader food system. They are an effective conduit to target our end beneficiary goal: supporting smallholder farmers.
Combating food insecurity is a key development priority for Norway. Traditionally, we have a very strong focus on smallholders, but we know it is also very challenging and costly to engage directly with this target group.
That is why we established FASA. It aims to solve several interconnected challenges. First, agri-SMEs are vastly under-financed largely because traditional banks view them as too risky. Second, investment funds targeting these businesses also struggle to raise capital. Third, mobilizing capital is becoming an important area for us development agencies. But we have struggled to find good ways to work together on these issues.
Our development priorities are now centred on system change, and FASA is designed to support that shift. It addresses the financing gap through catalytic private capital, such as first loss guarantees, and more importantly, serves as a multi-donor platform. We need scale to deal with the huge issues in food systems, and that requires coordination, not fragmentation. That’s the kind of system change Norad is aiming for, and FASA plays a central role in that vision.
We need scale to deal with the huge issues in food systems, and that requires coordination, not fragmentation.
Michelle: Given the significant shifts happening in the ODA landscape and the increasing recognition of blended finance and other innovative models beyond traditional approaches, how is Norad adapting its own strategy? What challenges and opportunities do you expect to face?
Anders: Good question. There are definitely changes happening across the global development architecture, and Norad’s thinking is evolving in response. While we have not launched a new formal strategy, we are moving beyond a traditional grant-based approach. We are exploring good deployment models that blend concessional grants with other sources of finance, including commercial finance.
Internally, we are building our capacity to do this by bringing in people from the private sector and financial communities, people who understand innovative finance, can speak that language, and help structure these deals. In the six years I have been at Norad, I have seen a significant shift toward working with the private sector, and that’s where I believe the greatest opportunities lie.
Blended finance also brings complexities. How do we ensure that our funding is truly additional and catalytic? How do we balance our development impact relative to the risks and costs involved? We have been facing the challenge of how to optimize capital deployment in a world where funding, especially ODA, is increasingly scarce. NORAD wants to act more as an investor with a development mandate rather than a traditional grant-giver.
More recently, we have shifted toward creating stronger partnerships, enabling private sector growth and mobilizing more capital to invest in the food sector. This is where our focus on agri-SMEs fits in.
Michelle: Can you share examples of successful donor coordination where Norway led or worked on initiatives that avoided duplication and encouraged complementary investments?
Anders: That’s another important question. Coordination is essential, especially in development where funding is so scarce and the risk of duplicating efforts is high. Unlike commercial markets where duplication can be absorbed, in development we risk competing for the same funding and partners. We don’t want that. We want to collaborate.
FASA is a great example of donors coming together—Norway, the US, UK, Korea, and the Small Foundation—to address a shared issue. It is a strong case of pooling capital together to solve a specific problem collectively.
Another example is Aceli Africa where Norad was one of the last to join. We had been funding a similar activity but once we learned about Aceli’s better approach, we realized it made more sense to join forces rather than run a parallel programme. That was a turning point for us in recognizing the value of collaboration over duplication.
We have been very focused on partnering with donors through open, constructive dialogue. GDPRD plays an important role here by providing a platform where we can actually talk together.
GDPRD is a trusted and practical space for coordination. What we value most is the ability to have real, concrete conversations among donors at a more technical level, but without the buzzwords or high-level discussions that often don’t translate into action.
Michelle: What are your thoughts on the GDPRD’s Thematic Working Group on Sustainable/Blended Finance for Food Systems and its collaboration with the Agri-SME Learning Collective (ASLC) around the Catalytic Capital Framework?
Anders: I think this is some of the most important work GDPRD is doing. We all talk about being “additional” and “catalytic” but we lack a common way to measure or define that impact.
The Catalytic Capital Framework is helping to solve that. Unless we adopt a new standard or framework, it's all for nothing. This is where the GDPRD can fill an important role, to be that standard setter and advocate for a shared language among donors on when and how we use concessional capital effectively.
What makes this collaboration unique is the blend of GDPRD’s policy-level coordination with the market intelligence from the Agri-SME Learning Collective. Without a tool like this, we are in the dark when it comes to allocating concessional capital. GDPRD is helping to shine a light on that challenge.
Michelle: What is the greatest value the Donor Platform brings to the donor community, and how can it remain relevant to members’ evolving needs? How do you see Norway contributing?
Anders: GDPRD is a trusted and practical space for coordination. What we value most is the ability to have real, concrete conversations among donors at a more technical level, but without the buzzwords or high-level discussions that often don’t translate into action.
GDPRD should continue serving as a knowledge exchange hub, talking about current and pressing issues, and be more than a discussion forum by demonstrating successes and milestones. It can be a real force of strength and focus on building strong alliances among existing members and actively pushing for joint funding and collaborative action on initiatives like FASA or Aceli.
At Norad, our contribution right now is to be an engaged and active member—showing up, listening, learning, being open to collaboration, and sharing what we have learned. That’s the spirit we bring to the Platform.
Michelle: One key message to share with the donor community?
Anders: We are much stronger when we work together. Only then we can achieve that scale needed to address the massive challenges we face.
Interview conducted by Michelle Tang, Secretariat of the Global Donor Platform for Rural Development (GDPRD) on 14 August 2025
