Improving Agricultural Productivity Growth in Sub-Saharan Africa

Abstract

Improved agricultural productivity is central to achieving inclusive development, reducing poverty, and enhancing the living standards of most people in sub-Saharan Africa. Concerned by the declining state of agricultural productivity in this region, we pursue the question whether agro-processing activities and exports of raw agricultural materials have a backward linkages effect on agricultural production activities. And if the relationship exists how can it be more effectively used? The regression results indicate that increases in export of raw agricultural materials negatively influence productivity growth in agriculture. Consistent with the findings of other studies that agro-industrial growth in the sub-Saharan region faces several challenges, the response of agricultural production to agro-industrial activities was positive but inelastic. To overcome these challenges, improving the value of agricultural exports and thereby improving agricultural productivity growth are needed in policy, regulatory, and institutional frameworks across countries in the region that will enable agro-industrial development to become stronger; lead to the creation of opportunities for increased private sector engagement including through the formation of public-private partnerships for developing synergies; provide access to credit for participants along the agricultural value chain; provide rural infrastructure that reduces postharvest losses and transport costs and shorten transit time, while increasing overall rural mobility; support innovations and technology for developing competitive value chains; provide access to value-responsive markets; provide access to timely information for improving bargaining powers; establish organizations to reduce transaction costs; and lead to inclusion of women, poor, and/or marginal groups in the value chains. Overall, this strategy will be optimal when it concomitantly and yearly increases agro-industrial activities and decreases agricultural raw material exports by 2.5% of their existing values, given 1981 as the base year.