Agricultural development strategies that are put forward by individual
African countries delineate priorities for actions to enhance agricultural
and overall development. Understanding alternative agricultural
growth options and their linkages with poverty reduction and prioritizing
agricultural investments are the two key components of an agricultural development
strategy. However, the relationships between growth and poverty
reduction and between targeted growth and required public investment are
not straightforward, and solid research is needed to support an evidence-based
policymaking process. This monograph provides such a study using Rwanda
as a case. An economywide model is developed for the study and is applied
to the most recent economic data and public investment information to analyze
agricultural growth and investment options for poverty reduction in
Rwanda. The monograph shows that the country’s targeted agricultural subsector
growth, if achieved, would allow Rwanda to meet the Comprehensive
Africa Agriculture Development Programme (CAADP) target of 6 percent annual
growth in agricultural gross domestic product (GDP) by 2020. With comparable
growth in the nonagricultural sector, rapid economic growth would
result in the national poverty rate falling to 35.5 percent by 2015, a reduction
of 25 percentage points over the 1999 rate. Although the majority of
rural households benefit from rapid agricultural growth, the most vulnerable
households—those with very small landholdings and with few opportunities to
participate in the production of export crops—appear to benefit less. The report
shows that economywide growth led by the agricultural sector has a greater
effect on poverty reduction than does the same level of growth driven by
the nonagricultural sector. Among agricultural subsectors, growth driven mainly
by increased productivity in staple crops has the greatest poverty reduction
effect.