There is a lot of evidence that agriculture can contribute to poverty reduction beyond a direct effect on farmer's incomes. Increased productivity of agriculture raises ....

There is a lot of evidence that agriculture can contribute to poverty reduction beyond a direct effect on farmer's incomes. Increased productivity of agriculture raises farm incomes, increases food supply, reduces food prices, and provides greater employment opportunities in both rural and urban areas. Global Girl Child Youth Initiatives agrees with views that a productive agriculture is critical for employment creation and poverty reduction is now widely shared within the development community. Yet, this has not always been the case. In the runup to the 2008 world food price crisis, many development practitioners, government officials, and economists doubted whether agriculture could still play this role, especially in Africa. Agro-pessimism had set in during the 1990s and 2000s, with a decline in policy attention and agricultural investment. The food price spikes of 2008 brought a realization that more needed to be done to strengthen agriculture in developing countries. Today, world food prices are still 70 percent higher than before the food price crisis (or 40-50 percent in real terms) and the trade and policy environment is much more favorable to agriculture. But African incomes have also grown, poverty has come down and countries are more urbanized. So, what then is the role of agriculture for poverty reduction today and is the favorable inclination towards agriculture of the past years also backed up by the more recent evidence? Growth in agriculture remains more poverty reducing than growth elsewhere Growth in agriculture remains in general two to three times more effective at reducing poverty than an equivalent amount of growth generated in other sectors. This holds irrespective of the empirical method or the poverty metric used to estimate this. It is consistent with the findings reported in the literature so far. The poorest benefit most from agricultural growth The effects on poverty reduction of agriculture are largest for the poorest in society and the advantage of agricultural over nonagricultural growth in reducing poverty ultimately disappears as countries become richer (see graph). Furthermore, the lower the literacy rates, the stronger the progressivity in the poverty-reducing effect of agricultural over nonagricultural growth. This supports the current policy attention to agriculture in Africa and South Asia, which together house more than 80 percent of the world’s extreme poor today. comparative advantage of agriculture is not limited to landlocked countries The degree of tradability of the food (and nonfood) that experiences the increase in productivity is an important consideration in determining the reduction of poverty from growth in that sector. It affects the extent to which prices decline and thus the extent to which producers and consumers gain. Computable general equilibrium model simulations for around 300,000 households from 31 countries suggest that agriculture’s advantage holds, irrespective of whether food is considered tradable or not. Agricultural growth appears a priority for poverty reduction in landlocked and coastal economies alike. However, agriculture’s edge over non-agriculture varies by the latter’s subsectors There is substantial heterogeneity in the poverty reducing effects of non-agriculture across its different subsectors. Trade and transport services have poverty to growth elasticities closer to those of agriculture, and those for manufacturing, especially agro-processing, can at times even exceed them. Contrarily, the poverty-reducing effects of mining, finance, and business and government services are much more limited. Productivity growth in trade and transport services can have both direct linkages to the poor, but also indirect ones, for example, by reducing the transaction costs for the marketed products. This is particularly beneficial in sectors with higher margins, such as agriculture and food. Sustainable Livelihood Program: Providing and Expanding Access to Employment and Livelihood Opportunities The objective of the Sustainable Livelihood Program is to reduce poverty and inequality by generating employment among poor households and by moving highly vulnerable households into sustainable livelihoods and toward economic stability. It has two tracks: 1.The micro-enterprise development track provides participants with access to funds and training to set up their own microenterprise. 2.The employment facilitation track provides employable individuals access to locally available jobs through public-private partnerships.


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