Impact of Public Agricultural Investment on Crops Production, Households’ Welfare, and Employment Generation Opportunities in Togo, West Africa

Interventions to maximize food production and improve households’ welfare and job creation are key targets of governments’ policies in implementing the national development plans of most developing countries, including Togo. We assess the impact of public agricultural investment (PAI) on crop production, employment generation, and households’ welfare in Togo using a computable general equilibrium model, given its appropriateness in handling economy wide and the welfare effect of specific policies. We consider three scenarios: a 10% and 25% increase in PAI as engaged by the African heads of state in 2003 in the Maputo Declaration on Agriculture and Food Security in Africa and re-engaged in Malabo in 2014, and the recommendation of the Food and Agriculture Organization of the United Nations, respectively, while 5% increase in PAI is used as the optimist scenario. We find that PAI positively affects food and cash crop production, breeding and hunting, fishing, silviculture, and lumbering. Increasing PAI by 10% boosts annual food and cash crop production by 81.17 million US$ and 14.75 million US$, respectively, while a 5% annual increase improves households’ welfare (8.71%) and job creation (5.96%). Fishing and food crop production are the most promising sub-sectors with significant impacts on job creation and households’ welfare. These findings have important policy implications and serve as a benchmark in decision making in considering the importance of PAI in households’ welfare in developing countries, where agriculture is still seen as a cornerstone of countries’ economies. We recommend investment reallocation at 10% or at least 5% of the national budget to agriculture to boost food production and improve households’ welfare while generating decent jobs in the economy.