Abstract
Agriculture plays a crucial role in the economy of Burkina Faso and other sub-Saharan African countries. It provides food for the population and is the primary source of employment in rural areas. The government of Burkina Faso has implemented a 2018–2027 Agro-Sylvo-Pastoral production sector policy to improve agricultural productivity and reduce poverty. This study uses a dynamic computable general equilibrium model linked to a microsimulation model, which evaluates the impact of subsidizing investment in agricultural capital on production, income, and poverty under three different fiscal financing scenarios. The results indicate that the agricultural mechanization subsidy program effectively reduces poverty, but the extent of the reduction varies depending on the financing method used. Financing the subsidy by reducing nonproductive public expenditure further reduces poverty, especially in rural areas. However, it is essential to supplement the subsidy policy with an agricultural extension service program for the program to have long-lasting effects.
Resumen
La agricultura juega un papel crucial en la economía de Burkina Faso y de otros países en África subsahariana. Proporciona alimentos para la población, y es la principal fuente de empleo en las áreas rurales. El gobierno de Burkina Faso ha implementado una política para el sector de producción Agro-Silvo-Pastoral 2018–2027 al fin de mejorar la productividad agrícola y reducir la pobreza. Este estudio utiliza un modelo de equilibrio general dinámico computable vinculado a un modelo de microsimulación, que evalúa el impacto de las inversiones subvencionadas en capital agrícola con respeto a la producción, los ingresos, y la pobreza, bajo tres escenarios diferentes de financiamiento fiscal. Los resultados indican que el programa de subsidio a la mecanización agrícola efectivamente reduce la pobreza, pero el grado de la reducción varía a según del método de financiamiento utilizado. Financiar el subsidio a través de una reducción del gasto público no productivo reduce aún más la pobreza, especialmente en áreas rurales. Sin embargo, es esencial complementar la política de subsidios con un programa de servicio de extensión agrícola para que el programa tenga efectos duraderos.
Résumé
L’agriculture joue un rôle crucial dans l’économie du Burkina Faso et d’autres pays d’Afrique subsaharienne. Elle fournit de la nourriture à la population et est la principale source d’emploi dans les zones rurales. Le gouvernement du Burkina Faso a mis en œuvre une politique du secteur de la production agro-sylvo-pastorale 2018–2027 pour améliorer la productivité agricole et réduire la pauvreté. Cette étude utilise un modèle d’équilibre général calculable dynamique lié à un modèle de microsimulation, qui évalue l’impact de la subvention de l’investissement en capital agricole sur la production, le revenu, et la pauvreté, sous trois scénarios différents de financement fiscal. Les résultats indiquent que le programme de subvention à la mécanisation agricole réduit efficacement la pauvreté, mais l’ampleur de la réduction varie selon la méthode de financement utilisée. Le financement de la subvention par la réduction des dépenses publiques non productives réduit davantage la pauvreté, en particulier dans les zones rurales. Cependant, il est essentiel de compléter la politique de subvention avec un programme de service de vulgarisation agricole pour que le programme ait des effets durables.
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Notes
CFA = Communauté Financière Africaine. The CFA franc is the common currency used by eight West African countries, including Burkina Faso. The exchange rate of FCFA to Euro is fixed at 1 EURO ≈ 657 CFA franc. However, the exchange rate with the US dollar is floating, and we currently use the rate of 1 USD for 550 CFA franc.
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Sawadogo, B. Can Burkina Faso’s Agricultural Mechanization Program Reduce Poverty in the Country. Eur J Dev Res 36, 1016–1036 (2024). https://doi.org/10.1057/s41287-023-00621-w
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DOI: https://doi.org/10.1057/s41287-023-00621-w
Keywords
- Poverty
- Agricultural mechanization
- Fiscal adjustment
- Dynamic computable general equilibrium model
- Burkina Faso