Agriculture’s central role in stimulating

In most poor countries, agriculture is a major employer and source of national income and
export earnings. Growth in agriculture tends to be pro-poor – it harnesses poor people’s key
assets of land and labour, and creates a vibrant economy in rural areas where the majority
of poor people live. Agriculture connects economic growth and the rural poor, increasing
their productivity and incomes. The importance of agriculture for poverty reduction,
however, goes well beyond its direct impact on rural incomes. Agricultural growth,
particularly through increased agricultural sector productivity, also reduces poverty by
lowering and stabilising food prices; improving employment for poor rural people;
increasing demand for consumer goods and services, and stimulating growth in the nonfarm
economy.
A positive process of economic transformation and diversification of both livelihoods and
national economies is the key to sustained poverty reduction. But it is agricultural growth
that enables poor countries, poor regions and ultimately poor households to take the first
steps in this process.