The Benefits of Climate Finance for Sustainable Livestock Systems in Low- and Middle-Income Countries

Introduction: Why livestock matters

The current climate finance architecture is grossly misaligned with the practical realities of sustainable livestock systems in low- and middle-income countries (LMICs). This is despite the overwhelming evidence pointing to livestock systems as multifunctional assets offering solutions for both climate change adaptation and mitigation. Reframing the narrative to recognise livestock’s inherent versatility and its capacity to deliver the climate ‘triple wins’ (climate mitigation, climate adaptation and socio-economic benefits) is crucial for unlocking targeted, impactful and climate funding as a strategic financial instrument in climate action. Livestock systems in LMICs are important in food production and instrumental in the transition toward circular and sustainable bio-economies. Livestock play a key role in nutrient cycling, material and draught power resources for production, landscape management and sustaining rural livelihoods. The sector’s contributions cover multiple dimensions:

• Nutrition and food security: Animal products are a source of essential proteins and bioavailable micronutrients that are crucial for vulnerable populations in LMICs. Ruminant livestock also upcycle inedible biomass such as forage, food waste and crop residues into high-quality food and thus reduce food waste and feed-food competition.
• Agriculture support, soil health and environmental conservation: In many developing economies, livestock provide essential draught power for agricultural activities, as well as manure. Manure is an organic fertiliser, reducing the need for synthetic fertilisers and enhancing soil organic matter content, water retention, biological activity and long-term productivity. In grasslands, grazing animals help control invasive plant species and reduce wildfire risk.
• Economic assets and livelihood support: Livestock are capital assets that serve as informal savings and insurance for households. The livestock sector supports 1.3 billion people globally,¹Philip Thornton et al., Livestock and Climate Change: Outlook for a More Sustainable and Equitable Future, Report (CGIAR Initiative on Livestock and Climate, 2024). predominantly in LMICs, contributing approximately 40% of agricultural GDP²Robyn G. Alders et al., “Livestock Across the World: Diverse Animal Species with Complex Roles in Human Societies and Ecosystem Services”, Animal Frontiers 11, no. 5 (2021): 20–29. and creating jobs throughout value chains while offering empowerment opportunities for women, youth and marginalised groups.
• Material value: Beyond food and energy, livestock produce a wide range of by-products used in construction, textiles, pharmaceuticals, cosmetics and bioplastics that reduce waste and provide renewable, biodegradable alternatives to synthetic materials.
• Cultural heritage: Livestock are deeply embedded in cultural heritage and rural identity. They foster community cohesion, sustain small farms and local economies and enhance human well-being through companionship, therapy and education.

Growing calls to cut down on meat consumption, the number of livestock and agricultural greenhouse gas (GHG) emissions fail to consider the importance of livestock keeping in LMICs. In most cases, decision makers and advocacy groups look at the livestock sector through the narrow lens of contribution to GHG emissions. This single-lens framing of the livestock sector fails to comprehensively capture its wider value to society.