STRATEGIC ANALYSIS UNDER CAADP PROCESS

Paul Guthiga, ReSAKSS‐ECA

Workshop on Strengthening Capacity for Strategic Agricultural Policy and Investment Planning and Implementation in Africa 

Safari Park Hotel, Nairobi on 25th‐ 26th April 2012

Key Issues in Agricultural Development

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Importance of Agriculture in African Economies

• Agriculture remains a key sector in most countries in Africa;

– Part of strategy for achieving economic growth, poverty reduction & foodsecurity

3Source: compiled by ReSAKSS based on the mostly recently available country sources

Low budgetary allocation…

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Sector Growth‐1

• After several decades of stagnation;– The continent posted positive overall GDP growth rates & agricultural

growth during the last decade

• Impressive progress in agricultural GDP growth; 

– Average rate of 4 percent between 2007 and 2009

• With differences in performance among countries…

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Sector Growth ‐2

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-10

-5

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5

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Bur

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DR

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Com

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Djib

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Egy

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Erit

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Eth

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Ken

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Liby

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Mad

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Mal

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Rw

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Sud

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Sw

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Sey

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Tanz

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Zam

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Zim

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AgG

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Average 1999-2001 Average2002-4 Average 2005-2007

Source: Authors’ computations based on data on ReSAKSS Website

Sector Growth…3 • The countries that met the CAADP target included;

– Rwanda (8.4%), Ethiopia (7.7%), Tanzania (7.3%) and Malawi (6.5%). 

• However, high growth rates in agricultural GDP have not 

invariably translated to reduction in poverty and hunger. 

– In some countries there is marginal or no reduction in poverty despite 

high growth in  agricultural GDP.

– Need for targeting investments subsectors or in geographical regions with 

potential for high impact on poverty

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Sector Growth…4

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Agricultural productivity…1 

• Ag. productivity growth in Africa, especially in SSA, has been impressive since the mid‐1980s

• Labor productivity risen faster than land productivity in the continent as a whole…

• But in SSA and in some countries land productivity has risen faster than labor productivity..

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Land and Labour productivity in SSA and Sub‐regions (1961‐2009)

Source: ReSAKSS ATOR, 2011 10

Labour and Land Productivity in Selected Countries (1961‐2009)

Source: ReSAKSS ATOR, 2011 11

Total Factor Productivity in SSA (1961=1)

• Slight improvement in 1960s followed by rapid deterioration till mid 1980s

• Very little technical change over the whole period

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Maize productivity…1

• Maize is the key staple in most countries in the region.  

• Maize yields in the majority of countries in the COMESA 

region are very low;

– Mostly less than 2 tones/ha compared to a world average of 5 

tones/ha

• Yield decline has occurred in several countries in the region 

over the past decade

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Maize Productivity…2

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2006 ‐ 2010 production growth rates 2006 ‐ 2010 Yield growth rates

Beans Maize Beans MaizeCOMESA  2.4 5.0 1.7 1.3East Africa  2.4 3 0.9 ‐1.4Burundi ‐0.8 2.0 5.0 ‐1.0Comoros 5.1 0.5DRC 0.9 0.0 0.0 ‐0.01Djibouti 0.8 ‐2.6 3.7 ‐12.4Egypt 0.3 4.2 ‐2.3 ‐3.1Eritrea ‐4.5 1.3Ethiopia 16.5 3.4 5.7 ‐0.1Kenya ‐5.2 ‐2 0.7 ‐4.7Libya 2.2 ‐1.5 0.1 ‐1.7Madagascar 1.0 0.5 ‐0.8 ‐4.0Malawi 8.0 8.9 9.8 7.3Mauritius 17.2 3.8Rwanda 2.9 51.1 5.5 36.9Sudan ‐2.8 ‐21 ‐0.4 4.1Swaziland ‐1.1 6.1 0.3 4.6Uganda 2.0 1.9 ‐0.4 ‐0.3Tanzania 3.1 5.6 ‐0.8 ‐0.6Zambia 18.2 5.1Zimbabwe ‐5.7 ‐7.2 ‐3.9 ‐3.3

Production versus Productivity Growth 

Production is growing faster than productivity

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Poverty trends

• Africa as a whole has experienced a moderate decline in the rate of poverty since 1990

• From 47.0 percent in 1990–95 to 46.5 percent in 1995–2003 and 44.3 percent in 2003–09. 

• The COMESA region experienced similar declining trend, with different levels of intensities across countries. 

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Poverty declining.. but still high (1)

Country Name Most recent year Most recent poverty rates 2011 EstimatedRates

Burundi 2006 81.3 78.3Comoros 2004 46.1DRC 2006 59.2Egypt 2005 1.9 2.2Ethiopia 2005 39.0 25.6Kenya 2005 19.7 19.8Madagascar 2005 67.8 55.2Malawi 2004 73.9 64.4

Rwanda 2005 76.8 77.1Swaziland 2001 62.9 45.7Tanzania 2007 67.9 58.3Uganda 2009 28.7 21.4Zambia 2004 64.9 62.2

International Poverty Line: Poverty rates $1.25 a day (PPP) (% of population)

Source: http://data.worldbank.org ; 2011 Estimates are authors calculations based on “business as usual scenarios” 17

Food Insecurity and Malnutrition

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05101520253035404550

Burundi

Comoros

DRC

Djibouti

Eritrea

Ethiopia

Kenya

Madagascar

Malaw

i

Mauritius

Rwanda

Sudan

Swaziland

Tanzania

Uganda

Zambia

Zimbabw

e

1990 2003 2010

Global Hunger Index (GHI)

Key: • 0 (No hunger)• 20.0‐29.9 (Alarming hunger)• 30 and above (Extremely Alarming)

Trends in GHI…hunger has reduced, but  increased in some countries

Country% Change in GHI values

1990‐2010% Change in GHI values 

2003‐2010Burundi 17.5 ‐10.3Comoros 5.7 ‐9.4DRC 60.8 9.0Djibouti ‐23.5 12.4Ethiopia ‐32.3 ‐18.8Kenya ‐15.7 ‐8.9

Madagascar ‐5.5 ‐8.1Malawi ‐43.5 ‐28.3Mauritius ‐8.2 76.3Rwanda ‐18.4 ‐15.1Sudan ‐18.4 ‐18.6Swaziland ‐19.4 ‐27.4Tanzania ‐20.7 ‐30.9Uganda ‐24.6 ‐19.5Zambia ‐14.4 ‐21.6Zimbabwe 3.5 ‐9.9

Source: Authors’ computation 19

Rising food prices worsen hunger situation…

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0

50

100

150

200

250

300

350

400

Jan‐07 Apr‐07 Jul‐07 Oct‐07 Jan‐08 Apr‐08 Jul‐08 Oct‐08 Jan‐09 Apr‐09 Jul‐09 Oct‐09 Jan‐10 Apr‐10 Jul‐10 Oct‐10 Jan‐11 Apr‐11 Jul‐11 Oct‐11 Jan‐12 Apr‐12

Ethiopia‐ Food Total FAO GLOBAL‐ Food Kenya‐ Food & Non‐Alcoholic Drink

Malawi‐ Food  MauritiusFood And Non Alcoholic Beverages  Rwanda‐ Food And Non‐Alcoholic Beverages

Tanzania‐ Food and Non alcoholic beverages Uganda‐ Food Zambia‐ Food

Djibouti ‐ Food

Market Access and Trade• Agricultural trade accounts for about a third of the total intra‐

COMESA trade • Regional trade in food staples has implications on regional 

food security • But.. Intra‐regional trade  especially agriculture remain low• Constrained by

– Trade barriers; Tariff & non‐tariff barriers– Poor infrastructure

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Trend in the Structure of Intra‐COMESA Trade

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Source: COmStat

Environmental degradation & climate change

• Environmental degradation is a prevalent problem;

• Broad consensus that climate change poses a serious risk toagricultural production and food security in Africa

• Impacts of climate change manifested through extreme andincreasingly variable weather conditions.

• High dependence on rain‐fed agriculture, coupled with weakcapacity to adapt pose huge threat for agriculture andlivelihoods

• But… little weight in policy

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POLICY ANALYSIS

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Agricultural Policy Making…1 

• Agriculture has regained policy prominence; hence policyinitiatives like CAADP.

• New approach; evidence‐based and inclusivepolicymaking processes

• Increasing economic integration hence more policymaking processes at the RECs level;– trade policies,

– macro‐economic policies,

– agricultural policy etc

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Agricultural Policy Making…2 

• But, …little understanding of policy‐making processesand political economy motivations.

• Entry of many new actors in the policy arena.

• Consensus that persistent problems of poverty and food insecurity can be addressed; correct identification of policies and their implementation.

• But the problem of poor policy formulation and implementation still persist.

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Agricultural Policy Making…3 • Policies are often;

– Formulated without evidence, 

– Likely impacts are poorly analysed and understood

– Good policies are hindered by poor implementation.  

• The changing policy environment require;– Increased understanding of policy making processes and

– Skills and tools to effectively participate in policy processes 

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Characteristics of public policies..1

• Problem‐centred: attempt to address specificproblems affecting specified groups in the society

• Based on scientific methods to be able toconvince stakeholders on reliability and somedegree of objectivity;

• Normative – Not completely objective as valuejudgement cannot be entirely eliminated;

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Characteristics of public policies..2

• Involves some art, craft and persuasion to marshal various interest groups especially the losers in a policy decision 

• Multi‐disciplinary: Good public policies incorporate ideas from different fields such as economics, sociology, biology, political science, etc

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Steps in Policy Analysis…1

• Define and analyze the problem– Questions ;Who is affected and how seriously?– may include looking for causes

• Construct policy alternatives – might be the most important step– want to encourage creativity

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Steps in Policy Analysis…2

• Develop evaluative criteria– effectiveness, efficiency, equity, political feasibility– assess potential of different criteria– will vary depending on the problem

• Assess policy alternatives– ask which is likely to produce desired outcomes

• Draw conclusions– some may advocate a single policy action, but others may not

– be sure of the information gathered

Strategic Analysis Under CAAD Process

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Strategic Issues…1

• What has been the past performance and outlook foragricultural growth and poverty reduction?

• What are the Strategic options and sources for growth andpoverty reduction?

• What growth rates are needed to achieve set developmenttargets?

• What investment options can generate the needed growth?

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Strategic Issues…2

• Which sub‐sectors within agriculture have the highestpotential to deliver on development goals e.g. povertyreduction?

• What levels of funding is needed to achieve the set goals?

• What kind of strategic analysis and knowledge supportsystems is needed to guide implementation of identifiedstrategies at country level?

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Major outputs from strategic analysis…1

• Country background papers and brochures and briefs utilized

in CAADP roundtables that examined

• The brochures and briefs have been utilized in countries such

as:

Benin, Burundi, Cape Verde, Ethiopia, Ghana, Niger, Nigeria, Mali,

Senegal, the Gambia, Liberia, Rwanda, Sierra Leone, Uganda, Tanzania,

Togo among others.

• Agricultural growth and investment options for poverty

reduction for countries such as:

Rwanda, Uganda, Mozambique, Zambia, Malawi, Ghana

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Major outputs from strategic analysis..2

• CAADP Monitoring and Evaluation (M&E) framework

• Development of high quality databases, advanced policymodelling tools, and detailed baselines.

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THANK YOU

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Fertilizer consumption Kg/ ha arable land

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LOW fertilizer use ; average 30kg/ha