Generating Rural Employment in Africa to Fight Poverty

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Generating Rural Employment in Africa to Fight
Poverty

• Janvier D. Nkurunziza
• United Nations Economic Commission for Africa
• Sub-regional Office for Central Africa
• Yaoundé, Cameroon
• Email Jnkurunziza_at_uneca.org

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Outline

• Key message
• Poverty and Unemployment Facts
• Poverty, unemployment and growth
• Generating rural employment 3 issues
• Conclusion

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Key Message

• Africas high poverty rates are the result of
  past economic policies that have neglected rural
  economies. Fostering rural employment will have a
  lasting effect on poverty reduction

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Africa has highest poverty in world
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Poverty varies across countries
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Poverty is a rural phenomenon
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Unemployment is high
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Unemployment figure misleading

• Data collection problem
• High number of discouraged workers
• High number of working poor 56 percent
• Large variations across
• Age groups youth unemployment is twice the
  average
• Gender Female unemployment is underestimated
• Countries highest rates in Southern Africa
• Geographical areas rural is higher than urban

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Growth has not created jobs
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Growth has not created jobs

• Growing sectors are capital-intensive. In 2005
• Oil economies grew by 6.1 percent
• Non-oil economies grew by 4.1 percent
• Poor intersectoral linkages between growing
  sectors and the rest of the economy
• Terms of trade not favourable to labour-intensive
  sectors
• Policies favour capital rather than
  labour-friendly technologies
• Limited employability of the poor

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Does job creation have priority status?

• If job creation is high priority, this should be
  reflected in PRSPs
• Analysis of 21 PRSPs shows the following
• 33 (7 countries) have a low employment content
• 62 (13 countries) have a medium-low employment
  content
• 5 (1 country) has a medium-high employment
  content
• These findings contrast with several declarations
  at highest political level on centrality of
  employment creation
• Key issue is how to translate declarations into
  actions

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Creating rural employment

• Completing Africas demographic transition
• Structural transformation based on agriculture
• Fostering development of rural nonfarm activities

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Completing demographic transition

• Reduction in fertility rates will reduce working
  age population
• Low demand for jobs
• Shift from quantity to quality of jobs (decent
  jobs)
• Low pressure on land
• Higher agriculture productivity (see table 3)
• Higher economic transformation (see table 3)
• The surge of HIV/AIDS is profoundly affecting
  African economies, particularly rural areas

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Agriculture transformation sectoral linkages

• Agriculture is source of income for 90
  population
• Allocate sufficient resources to agriculture
• In Burundi, 99 of poor are rural agriculture
  sustains livelihoods of 90 but it receives 0.68
  of total credit
• Commerce receives 72 of total credit
• Good governance to make efficient allocation of
  resources possible rural populations are poorly
  represented
• Address land-related issues (see table 4) they
  include
• Property rights to those using land
• Redistribution of land to landless
• Encourage investment in land soil conservation
  measures
• Increase land productivity use of fertiliser
  high-yield seeds

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Developing rural nonfarm activities

• 30-50 of landless derive income from RNF
  activities
• 10 of rural force (47 in Eastern Europe) but
  42 of rural incomes big potential for
  employment creation
• Integrated with agriculture development (see box
  2 on Uganda) agroprocessing, services to
  agriculture, etc.
• Needs different types of capital to thrive
• Human social capital networks and information
  are crucial
• Financial capital more than for agriculture
• Physical capital electricity, roads, telecoms,
  etc. For example, electricity allows
  technological upgrading new activities
• Natural capital determines the nature of
  activities, for example tourism (see Box 3 on
  Zimbabwe)

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Conclusion

• Agriculture development is the backbone of rural
  employment in most African countries so, focus
  here
• Agriculture needs to create links with nonfarm
  activities to amplify the effects of agriculture
  growth
• To facilitate this economic transformation,
  Africa will need to
• Complete its demographic transition
• Invest in human, social, financial, physical and
  natural capital
• Making rural employment a priority will also
  require improvement in political and economic
  governance.

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Thank you very much