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Prioritizing public investment in agriculture to spur Uganda’s inclusive economic recovery












FAO. 2022. Prioritizing public investment in agriculture to spur Uganda’s inclusive economic recovery. FAO Agricultural Development Economics Policy Brief, No. 45. Rome.



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    Productive public investment in agriculture for economic recovery with rural well-being: an analysis of prospective scenarios for Uganda 2022
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    This study highlights how, through a series of scenarios, public investments promoting agricultural productivity in Uganda could drive growth in agrifood production, with favourable impacts on the economy, on well-being and on poverty, especially in rural areas. Using a modelling tool to represent the Ugandan economy, with its multiple sectors and current fiscal constraints, the study ranked the subsectors of Uganda’s agriculture that, through the productivity impact of public investments representing 0.25 percent of GDP (on average, about 373 billion 2017 Uganda shillings) during the years 2023–2025, will generate the greatest socio-economic benefits, maximizing the cost-effectiveness of the public investments. Generally, economic growth and the welfare of households, as measured by their consumption, will be positively impacted, but the impacts will ultimately depend on the sector that receives the investment, which is shown in a ranking. The agricultural sectors targeted for government investment will increase their output (and food prices will thus fall), and this will stimulate growth in non-agricultural sectors, both by increasing final demand for non-agricultural products and by lowering input prices and fostering upstream processing. Lower food prices will have a significant impact since food represents a relatively large proportion of the consumption basket of poorest households. Furthermore, labour income for rural households will increase with productivity growth, and this will reduce rural poverty. The findings of this study provide important information about the priorities of Uganda’s National Development Plan (NDP) III and vision for agriculture, as well as new priorities to be considered for enabling economic recovery with increased well-being post-COVID-19.
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    Book (series)
    Productive public investment in agriculture for economic recovery with rural well-being: an analysis of prospective scenarios for Mexico 2021
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    Mexico's gross domestic product (GDP) contracted unprecedentedly as a result of the COVID-19 crisis. While the primary sector has relatively been the most resilient, the agriculture sector lacks sufficiently strong productive dynamism and has high rates of informal work and low wages. Investing more in the sector's productive infrastructure would help accelerate economic recovery while improving people’s well-being. A public investment policy should be developed on the basis of evidence, such as that provided in this study. In 21 prospective scenarios that simulate the allocation of additional public investment in productive infrastructure across subsectors of agriculture, equivalent to 0.25 percent of GDP (around MXN 50 billion) between 2021 and 2023, there is an improvement in total and agrifood GDP, and in the well-being of the Mexican people, as measured by private consumption and rural poverty reduction. However, it is recommended that new investment be focused on certain subsectors and that it be financed through foreign borrowing. According to a ranking of subsectors that receive new investment, the sugar cane subsector ranks first in three of the four variables considered (private consumption, total GDP, agrifood GDP and rural poverty). Cereals, mainly maize, but also others (rice, sorghum, oats, barley and other cereals), and the more export-oriented crops, such as flowers and coffee, also appear at the top of the ranking.
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    Policy brief
    Prioritizing investment in Paraguay’s agriculture is vital for recovery 2022
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    The findings reported in this brief have been adapted from the FAO Agricultural Development Economics Technical Study No. 19 Inversión pública productiva en la agricultura para la recuperación económica con bienestar rural: un análisis de escenarios prospectivos para Paraguay. This study presents prospective scenarios that provide information on where, within Paraguayan agriculture, the few public investment resources that would be allocated to the sector should be prioritized. A new public investment equivalent to 0.25% of GDP in the 2023–2025 period (1 798 billion guaranies in 2014), financed with external borrowing, would contribute to economic recovery. The increases in private consumption and GDP are between 0.1% and 0.2%, depending on the sector receiving the investment in agriculture. The increases in agrifood GDP are somewhat higher and the reductions in the national poverty rate vary between 0.2% and 0.5%.

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