Module 2: Analysis of Policy Context

1. Module 2: Analysis of Policy Context

2. Overview • To achieve their objectives in the food and agriculture sector, governments can use: • policies, and • supporting public expenditures • The MAFAP project focuses on three main monitoring domains: • incentives and disincentives resulting from policies in place • public expenditures, including national budget and aid flows • performance and development indicators.

3. Overview (continued) • The two first categories of indicators will require original analytical work so as to generate new information and core indicators of the MAFAP project • Third domain rests exclusively on secondary sources of data, indicators and policy studies. • Whenever possible the intention is to establish broad connections between the policy environment and the performance of the agricultural sector.

4. proposed description of the policy context • Brief description of the policy environment including summarized information on policies and policy decisions directly relevant to the food and agricultural sectors, • Indicators of performance and development in various domains, • Ancillary indicators relevant to interpreting the indicators on incentives/disincentives and public expenditures.

5. Outlines of the country report • Part 1: Background • Description of the economy, and the agricultural economy • F&A policy environment & political economy • Part 2: Findings based on in-depth analysis of agricultural and food policies and public investment in agriculture • Analysis of price incentives and disincentives in agriculture and degree of market development. • Analysis of public expenditures and aid directed to agriculture • Analysis of development and performance indicators and linkages • Part 4: Specific policy issues of interest to the country • Conclusions • Policy implications and elements for an evidence-based policy dialogue • Lessons learned and way forward

6. Purpose of the policy review • Country and global monitoring reports are used to improve policy dialogue in relevant policy fora at national, sub-regional and pan African levels • The policy review: • Describe the context of the analysis • Provides essential background to interpret the results

7. Elements of the review • Economic context analysis • Overall development issues • Agricultural sector development issues • Food security issues • Poverty issues • Policy context analysis • Policy objectives and agenda and country milestones • Key food and agricultural policies in the country • Main actors of the agricultural and food sectors

8. Economic context • Major features of the ag. & food economy : • Structure of the ag. & food sector • Natural resource base (endowments) • Crop production & production technology, • Development challenges & constraints. • Sector performance indicators

9. Economic context • Most important ag. commodities based on : • contributions to exports earnings • farm incomes (poverty reduction) • employment • food security • Use of secondary data and previous studies • recent indicators of the agricultural sector performance • Include supporting data (tables and graphs)

10. Policy Context Primary interest on the commodity focused policies Should include economy and sector-wide policies Policy context analysis can be organized in many ways Thematically on issues relevant to the policy monitoring process and the computation of indicators, e.g. pricing policy, trade policy, etc.. Commodity by commodity

11. Policy context: Major themes • Introductory overview of the policy context: • Overview of the Government: • Policy framework: Initiatives, strategies and programmes • Policy objectives and related instruments and interventions • Recent reforms of policies & programs • Policy making process (fora, etc.) • Main policy actors • Should cover the dynamic aspect (last, say, two decades) and review recent changes in the policy environment

12. Economy-Wide Measures: Examples • Exchange rate regimes • Tariffs • Marketing boards and monopolistic pricing • Export subsidies/taxes • Science and technology: research, extension and development • Agricultural credit • Export credit • Consumer taxes and subsidies • Input markets incentives (energy, fertilizer, seed ...etc.) • Trade restrictions such as quotas

13. Development and performance indicators (DPI) • Provide quantitative information on the setting within which incentives/ disincentives and public expenditures are being analyzed. • For example • indicator on percentage of rural roads paved will complement the analysis by linking the analysis of disincentives caused by (high) transportation costs and the government expenditures on infrastructure.

14. Considerations for selecting suitable (DPI) • The policy issues and national objectives under consideration (food security, economic growth, poverty reduction, etc.); • Simple yet meaningful indicators; and, • Data availability and quality.

15. Examples of DPI • A set of useful performance and development indicators (DPIs) can be defined and classified by building on ninecore thematic categories. • Wherever possible, the indicators should be disaggregated. • These indicators constitute a preliminary list which should not be considered as final but only indicative.

16. Sectoral performance & Market structure • Production, consumption, trade and changes in stocks • Agriculture as a share of rural and overall economic activity • Agricultural GDP and share of total GDP • Agricultural sector growth and economic growth

17. Costs in Output Markets • Share of rural roads that are paved • Development of water infrastructure

18. Costs in Input Markets • Share of farms with access to credit • Share of land for which there is legally recognized land tenure

19. Poverty, Inequality, & Food Security • Rural poor as a percentage of total poor population • Share of food insecure urban households vs. rural households and food insecure female-headed households vs. male-headed households • Gross per capita income rural vs. urban; male vs. female • Change (%) in land access for women and minority groups

20. Health • Life expectancy at birth • Prevalence (percentage) of underweight and undernourished children • Percentage of the population with access to safe drinking water • HIV prevalence

21. Labor & Employment • Percentage of rural labour force employed in agriculture • Share of women and men in the labour force • Earned income ratio female vs. male

22. Demography & Population • Population growth rates • Percentage of farmers who are members of community/producer organizations • Emigration rate (%)

23. Education • Education index • Enrolment ratio (%)

24. Environment & Natural Resources • Degree of deforestation • Irrigated land as a percentage of crop land • Frequency of drought and other natural calamities

25. Thank you!