Agricultural Growth and Poverty in Mozambique: Technical Analysis in Support of the Comprehensive Africa Agriculture Development Program (CAADP)

"Mozambique has experienced rapid economic growth over the last decade. National accounts estimates put the GDP growth from 2003–2007 at 8.4 percent per annum, with strong growth across all subsectors in the economy, including agriculture, industry, and services. Drought condition in 2008 and a spike in world prices had a negative effect on the economy, leading to a slowdown in GDP growth during 2007–2009. However, preliminary estimates point at a recovery during 2009–2010. Although never an outright priority in terms of the country’s development strategy, the agricultural sector has always played an important role in the Mozambican economy.This study uses an economywide computable general equilibrium (CGE) model for Mozambique to analyze the linkages and trade-offs between economic growth, poverty reduction, and caloric availability at both macro- and micro-economic levels. The following section provides background information on the data, the CGE model, and the two microsimulation components for estimating poverty and caloric availability changes, with additional technical detail provided in Appendix A. We then evaluate Mozambique’s recent agricultural growth performance, and specifically analyse yield performance of key staple crops at the national and regional level. Next, we present and discuss model results from our baseline and CAADP scenarios. The baseline scenario is calibrated under the assumption that Mozambique’s agricultural sector will continue along the same low-productivity growth path over the simulation period (2009–2019) as was observed during the preceding decade. The CAADP scenario, on the other hand, assumes more broad-based growth across all agricultural subsectors and attainment of the seven percent agricultural growth target. Finally, the conclusion highlights policy implications from the analysis."