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Policymakers in Papua New Guinea face difficult choices as to how best to promote economic growth and reduce poverty in the context of vast differences in technology and infrastructure across the country. Fluctuations in world prices of petroleum, minerals, and export crops complicate the management of the economy because of their large impacts on export earnings and government revenues, as well as household welfare. Moreover, other shocks, such as the Covid-19 pandemic that shut down major parts of the economies of PNG and the rest of the world, have far-reaching effects on various economic sectors, as well as the health and welfare of the population. This paper presents an analysis of investment options in the agricultural sector and the effects of major economic shocks to the PNG economy using an economy-wide computable general equilibrium (CGE) model that provides estimates of the economic linkages between production, household incomes, consumption, investment, and trade. The model's base data, a Social Accounting Matrix (SAM) for 2019, and many of the parameters are derived from the national accounts, household surveys and other data for PNG. It is important to realize, however, that even though the SAM and model structure provide a framework that guarantees a consistency of many of the assumptions, there remain many uncertainties in the data. Thus, the results presented here should not be interpreted as exact estimates, but only approximations of potential effects of policies and external shocks. The plan of this paper is as follows. Chapter 2 provides an overview of agriculture and economic growth in PNG over the last two decades, highlighting the declining share of agriculture in GDP despite positive agricultural GDP growth rates and changes in the real exchange rate that have major implications for incentives in the economy. Chapter 3 then presents a summary of the economy-wide model used in the analysis. Details of the model are found in the annexes and in the references included in the paper. Design ...

AbstractWe use economywide models to examine the economic recovery from COVID‐19 shocks in Bangladesh and Nepal during 2020–2026. Declining labor productivity, capital underutilization, consumption shifts, and international investment shocks had significant and differential sectoral and country‐level impacts in these countries. By 2026, GDP will be 6.9% and 13.9% lower in Bangladesh and Nepal, respectively, and the two countries will have an additional 3.3 million people in poverty compared to a no‐COVID baseline. Regaining economic and welfare losses will require substantial investments in key industrial, agricultural, and tourism sectors, although tough policy decisions will be required given high levels of public debt.

Indonesia has managed to combine high rates of growth, rapid reductions in rural poverty and a significant structural transformation of its economy all at the same time without a big increase in urban manufacturing. Agriculture was a critical part of this transformation through two important channels. First, export-oriented agriculture, particularly palm oil and rubber contributed to rising foreign exchange receipts and helped make compatible rapid growth without balance of payments pressure on the macro economy. Second, through the release of workers from low productivity agriculture to more productive nonagricultural activities, structural change contributed between 25 and 50 percent of the rise in national labor productivity depending on the period. The government also played an important role in agricultural development and productivity growth. Public investments in irrigation in combination with subsidies for fertilizer and improved seeds increased agricultural productivity generating an adequate supply of food for domestic needs with less labor. ; Non-PR ; IFPRI1; DCA; ReSAKSS Asia; CRP2; 4 Transforming Agricultural and Rural Economies ; DSGD; PIM ; CGIAR Research Program on Policies, Institutions, and Markets (PIM)

Bangladesh has successfully improved national food security over the last two decades, primarily by increasing rice production and consumption. However, the country's food system remains vulnerable to periodic floods and droughts that seriously affect agricultural production and prices. While food imports can cushion the effects of these short-term climate shocks, there is always uncertainty about whether shortages in global commodity markets will coincide with domestic production shortfalls, leading to particularly adverse outcomes, especially for poor farmers and net consumers. This is one of the reasons why Bangladesh's government has maintained a long-standing public grain procurement and storage system, as well as a large social protection program that distributes subsidized rice and wheat to poor households. These programs, together with investments in farm productivity, have enhanced the resilience of Bangladesh's food system to climate and world market shocks. Heightened climate variability in recent years has also led the government to increase stocks and make substantial new investments to expand public grain storage capacity. ; Non-PR ; IFPRI1; IFPRP; CRP2; 1 Fostering Climate-Resilient and Sustainable Food Supply; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food Industry; 5 Strengthening Institutions and Governance; DCA; Capacity Strengthening ; DSGD; PIM ; CGIAR Research Program on Policies, Institutions, and Markets (PIM)

AbstractThe COVID‐19 pandemic resulted in severe income losses, but little is known about its impacts on diets and nutritional adequacy, or the effectiveness of social protection interventions in mitigating dietary and nutritional impacts. We first assess the likely impacts of COVID‐19 shocks in Bangladesh and Myanmar on poverty and food and nutrient consumption gaps. We then analyze the estimated mitigating effects of five hypothetical social protection interventions of a typical monetary value: (1) cash transfers; (2) in‐kind transfers of common rice; (3) in‐kind transfers of fortified rice enriched with multiple essential micronutrients; (4) vouchers for a diversified basket of rice and non‐staple foods; and (5) food vouchers with fortified rice instead of common rice. The simulation results suggest modest effectiveness of the cash transfers for mitigating poverty increases and little effectiveness of all five transfers for preventing increasing food and nutrient consumption gaps among the poorest 40%. Rice fortification is, however, effective at closing key micronutrient consumption gaps and could be a suitable policy instrument for averting "hidden hunger" during economic crises.

The Philippines is much more prone to climate change effects than are many other countries. The potential impact on the agriculture sector is of particular concern, given its vital role in the economy and for vulnerable households. Most research warns of the negative impact of climate change on yields for major cereal crops, which could threaten food security and hinder the long-run development process. Incremental adaptation through the introduction of new crop varieties, improved agricultural management practices, and more efficient irrigation are expected to reduce yield losses. However, efforts to promote systemwide adjustment would have broader effects, especially as the risk of climate change increases. This study proposes a new approach for adaptation strategies by exploring policy reform in agriculture as a transformative way to help economic agents adapt to climate change. We specifically explore the rice policy reform currently being pursued by the government through the abolishment of the rice quota program. We find this reform could help transform the agricultural and economic system by allowing scarce resources move from low- to high-productivity sectors, thus increasing the country's adaptive capacity. However, the rice farmer and vulnerable groups that are prone to climate shocks are adversely affected by the policy. Thus, we introduce alternative intervention policies to complement the reform agenda by providing a cash transfers program to vulnerable groups or a subsidy to support rice farmers. Both offer less impact in economic efficiency gains, but the cash transfer program is superior in terms of supporting the vulnerable group in coping with climate change under the rice reform policy. This shows that the transformational adaptation strategy may create a welfare loss to certain agents but that adding government intervention could act as the second-best policy and become a transition pathway before the whole system transforms to reach the optimal efficiency point when the intervention program is eventually phased out. ; Non-PR ; IFPRI1; CRP7; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food Industry; 4 Transforming Agricultural and Rural Economies; CRP2 ; DSGD; EPTD; PIM ; CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS); CGIAR Research Program on Policies, Institutions, and Markets (PIM)

Agriculture continues to play a vital role in Indonesia's economic development. The sector contributes significantly to the country's gross domestic product, provides jobs for nearly 30% of the workforce, and has the essential function of providing food security. The report assesses the country's agricultural investments and policies, and evaluates the economy-wide impacts of alternative agricultural scenarios. The results show that Indonesia can virtually end hunger by 2030 with an appropriate mix of investments in agricultural research and development, irrigation expansion and water use efficiency, and rural infrastructure. The report makes key policy recommendations to support government efforts to mobilize these investments, which will also contribute to the country's economic growth. ; Non-PR ; IFPRI2; CRP2 ; EPTD; DSGD; PIM ; CGIAR Research Program on Policies, Institutions, and Markets (PIM)