This paper proposes a simple methodology to estimate the agricultural spending that will be required to achieve the Millennium Development Goal of halving poverty by 2015 (MDG1) in 30 sub-Saharan African countries. This method uses growth-poverty and growth-expenditure elasticities to estimate the financial resources required to meet the MDG1, considering both the direct and indirect impacts of agricultural spending on poverty reduction. The paper attempts to address a key knowledge gap by improving estimation of MDG costs at both the regional and country levels.

At the national level, dozens of African countries have pledged to implement the Comprehensive Africa Agriculture Development Programme (CAADP) of the New Partnership for Africa's Development (NEPAD) and the African Union (AU). This African-led plan aims to stimulate agriculture on the continent to achieve the first Millennium Development Goal (MDG1) of halving poverty and hunger by 2015. To do so, countries are expected to pursue 6 percent average annual agriculture growth at the national level, allocate 10 percent of national budgets to the agricultural sector, and improve overall policy efficiency through peer-review and accountability. The purpose of this paper is to evaluate trends in agricultural development, performance, and spending in Africa and to track corresponding progress in key poverty and hunger indicators following the recent food price crisis. The reason for tracking this information is that the recent food price crisis has the potential to derail the progress made toward reducing poverty and hunger in many African countries. This paper draws on policy research results in the literature to highlight some of the strategic policy options available to African governments for accelerating agricultural growth in line with the principles of CAADP. In this regard, the paper provides information on CAADP's agenda by reviewing the progress of implementation and performance against a number of key benchmarks.

This book contributes to the debate about the role of agriculture in poverty reduction by addressing three sets of questions: Does investing in agriculture enhance/harm overall economic growth, and if so, under what conditions? Do poor people tend to participate more/less in growth in agriculture than in growth in other sectors, and if so, when? If a focus on agriculture would tend to yield larger participation by the poor, but slower overall growth, which strategy would tend to have the largest payoff in terms of poverty reduction, and under which conditions?

West Africa is one of the poorest regions in the world. A full fifty-four percent of West Africans live below the poverty line, and if present trends continue, there will be more poor people in West Africa in 2015 than in 1990.1 At present, no West African state, except Ghana, is on trend to meet the first Millennium Development Goal (MDG) of halving poverty and malnutrition by 2015. Approximately 37 percent of children five years or younger in West Africa are under height for their age; 28 percent are underweight; and 10 percent of children are affected by acute malnutrition. Nutritional deficits are more common in women and children, and, geographically, in the Sahel states and the drier northern areas of coastal countries. USAID is committed through the Feed the Future (FTF) Initiative to regain momentum in addressing persistent poverty and hunger. USAID/West Africa's overarching FTF goal is to assist countries in West Africa in achieving MDG 1, Eradicating Hunger and Extreme Poverty. To achieve MDG 1, West Africa would need to annually reduce poverty by 5.2 percent. If the region's agriculture was to grow at 6.8 percent annually, West Africa as a whole would be able to halve poverty by 2015. Such rapid growth will require a substantial increase in public and private investments to transform production for West Africa's food markets and widen access. This document represents the U.S. Government's (USG) Multi-year Strategy under FTF. It reflects a highly integrated approach spanning the areas of Agriculture, Environment, Health and Trade and Investment, which accounts for its multi-faceted nature. USAID/West Africa (WA) will avail itself of the staff, expertise, and financial resources of these four offices to design and implement an interdisciplinary program that attacks poverty and food insecurity from a variety of angles.

"Agriculture and rural development must play a central role in stimulating economic growth, reducing poverty, and improving food and nutrition security in Africa. The food price crisis of 2007-08 highlighted the dramatic implications of world neglect of agricultural development over the past two decades. The current global economic recession now underscores the need for urgent attention to measures that could promote agricultural growth in Sub-Saharan Africa. Agriculture in Africa has not performed as well as expected during the past few decades. Agricultural growth rates in the region have increased modestly from about 2.4 percent a year in 1980-89 to 2.7 percent in 1990-99 and 3.3 percent a year since 2000.1 Only a handful of countries in Sub-Saharan Africa--Ethiopia, Mali, Mozambique, Nigeria, Senegal, and The Gambia--have surpassed the Comprehensive Africa Agriculture Development Programme (CAADP) threshold of 6 percent agricultural growth in recent years. Looking at poverty outcomes, whereas many developing regions, especially Asia and the Pacific, are on track to meet the first Millennium Development Goal (MDG 1) of halving poverty by 2015, progress in Sub-Saharan Africa has been slow. As a result, Sub-Saharan Africa is the only region of the developing world expected to have more poor people in 2015 than it did in 1990. Public spending is one of the most direct and effective instruments that governments can use to promote agricultural growth and poverty reduction, yet public agricultural spending in Africa has historically been very low compared with that in other developing regions. In recent years many Sub-Saharan African countries have pledged to increase government support to agriculture in order to achieve the goal of 6 percent annual agricultural growth, set by the New Partnership for Africa's Development (NEPAD) through CAADP. As part of the Maputo Declaration of 2003, African heads of state agreed to allocate 10 percent of their national budgets to agriculture. Yet many African governments are operating in an environment of scarce public resources, and so far only a few states have met these growth and spending targets. As African governments work to increase agricultural spending and boost agricultural growth, they face a dearth of information about which types of public investments contribute the most to development goals. How should scarce resources be allocated across different sectors of the economy--such as agriculture, infrastructure, health, and education--for maximizing development outcomes? Within agriculture, how should resources be allocated among, for instance, agricultural research, extension, irrigation, and input subsidies? In some cases African countries have clear principles on how to prioritize their scarce public resources, but they often lack the information needed to operationalize these principles. Drawing mainly on case studies from Africa, but also from Asia, this brief provides insights on the contributions of different types of spending to poverty, growth, and welfare outcomes in a variety of circumstances. These circumstances include, for example, Ethiopia's relatively large share of public spending allocated to agriculture, Nigeria's rich natural resource endowments, Ghana's relatively sound governance environment, Uganda's past success in economic growth and poverty reduction, and Tanzania's rapid transition from a planned to a market-driven economy." -- from Author's text.