| In earlier debates on economic development, the role of agriculture in national economy was somewhat controversial. While dualistic models highlighted the importance of agriculture in national economy the mainstream literature placed a greater emphasis on the creation of a modern industrial sector. Soon agriculture role disappeared from the mainstream development literature to re-emerge recently with a variety of multiple-sector growth models emphasizing the key role of agriculture in national economy.This thesis examines the role of agriculture in economic development of developing countries (DCs) in particular China and Sub-Sahara Africa (SSA). The aimed of the paper is to see in which measure agriculture contribute to national economy of DCs: China and SSA countries and identify the elements of a strategy that the DCs could implement to exploit their growth, their agricultural potential by improving their economic development. China is the largest DCs and Africa referring to SSA is the continent or region with the greatest number of DCs. In this paper the term SSA will be used to refer to Benin, Burkina Faso, Congo, Gabon, Cameroon, Chad, Central Africa Republic, Togo, Mali, Senegal, Niger, Cote D'ivoire, Equatorial Guinea, and Bissau Guinea.The place of agriculture in an economy of China and SSA, as well as the changes in its role over a period of time, generally follows a uniform pattern. In China and SSA economies, agriculture occupies an important place in terms of its share in the GDP, workforce and foreign trade. On all these counts, the share of agriculture declines with the growth in the economy. All DCs economies are no exception to these general tendencies. However, the pace of such decline varies from country to country, largely depending on the pace and pattern of economic growth, the production base, and activity mix of agriculture. This can be best illustrated in the context of these countries.Agriculture plays a crucial role in the national economy of China and SSA, provides the main source of food, income and employment to their rural populations. Improvements in agriculture and land use are fundamental to achieving food security, poverty alleviation and overall sustainable development.The agriculture sector is the single largest contributor to income and employment generation and a vital element in the country's challenge to achieve self-sufficiency in food production reduce rural poverty and foster sustainable economic development.Agriculture is the backbone of production; the dynamo of economic development. It has a significant effect on overall employment, on income, export revenue and then on GDP.In "typical" DCs, agriculture provides 25 - 40 percent of GDP, employs 60 - 80 percent of the labor force, and accounts for 30 - 60 percent of exports. In addition, a "typical" family in such a country spends 50 - 75 percent of its total income on food. The agricultural sector is thus uniquely central to governments' efforts to promote both poverty alleviation and national economic growth. This role derives in part from agriculture's prominent place on both the production and consumption sides of the economy. Yet, this dual role leads to a fundamental dilemma for development policy.Agriculture is a way of life, in most developing agrarian economies. Rapid growth of agriculture is essential for ensuring food security and alleviation of poverty. In DCs agriculture still contributes significantly to their overall GDP and it employs a large proportion of the work force. Agriculture can make significant contributions to attaining the development in DCsIn China for example, the annual rate of growth for the period 1965-2002 was higher than 8 per cent. China has had a good record of growth in GDP over a long period of time and agriculture has been the primary sector of national economy. However, compared to SSA countries, the rate of growth in agriculture was also rather low, at 2.1 per cent per annum and the performance of China in this regard was superior. The rate of growth in 'value added' in agriculture was equally impressive. It was above, or near, 4 per cent per year in China. During the period of 1978-2003 actual average growth rate of GDP was as high as 9.4%. Although agriculture (4.5%) failed to attain a comparably high growth rate to that of either industry (11.6%) or service sectors (10.3%), as the basis of national economy, stable growth of agriculture continues to provide a vital foundation for high growth in the overall economy, and for smooth implementation of reform in China. By 2003 the share of agriculture in GDP dropped to 14.6%, and the share of employment in agriculture dropped to 49.1%. The greatest contribution of agricultural growth is that it solved the problem of feeding a 1.3 billion nation.In SSA the agricultural sector's contribution to the Gross Domestic Product (GDP) was estimated at 33%. Thus, agriculture's contribution to GDP decreased in some countries in 2002, whereas that of industry doubled and that of services increased by about 20 % during the same period. For example in Congo the share of agriculture in the GDP has been a little 10.0 % and the sector's contribution to the country's exports is less than 1%. Gabon's agriculture has been characterized by the same trend as that of the Congo. Its share of the GDP is estimated at 4.5%. In Ivory Coast the share of agriculture in total GDP fell from 30 percent in 1985-1994 to 27.4 percent in 1999 etc...The feature that should interest us is the rate at which the share of agriculture declines in the total GDP. The declining share of agriculture during the process of economic growth is one of the best-documented relationships in all of economics... it holds for countries over extended periods of time and across countries at a point in time. The declining importance of agriculture is uniform and pervasive, a tendency obviously driven by powerful forces inherent in the development process, whether in socialist or capitalist countries, Asian, Latin American, or African, currently developed or still poor.In 1980, in most SSA countries and in China, value added by agriculture in the GDP was around 30 per cent or more, it was around 25 per cent in these countries. By 1998 in none of these countries was the share of value added by agriculture more than 30 per cent, except in Congo. There was a drastic fall in the share of agriculture in the GDP. Generally, there was rapid decline in the share of agricultural GDP in total GDP in these countries that started with a large agricultural sector. The decline got slower as the share of agriculture got reduced. This tendency can be clearly observed in all these countries.Chenery and Syrquin (1975) find that the share of agriculture in GDP decreases with the process of development. Chenery- Syrquin relationship holds on average for the whole world, and for developing and developed countries separately. Moreover, it holds not only across countries, but also within countries. But agriculture's share in the average of DCs in particular China and SSA countries has tended to decline significantly more slowly than in other DCs, which is due to these countries lower average share of agriculture in national GDP.The study relies on data collected from various sources: the statistical database of the Food and Agriculture Organization of the United Nations (FAOSTAT, 2004), World Bank (2004), Africa Development Bank, China statistical yearbook 2005 and China Agricultural Yearbook (various issues). Other data was obtained from Internet sites for government ministries and communities and researchers who have completed relevant studies. We have been able to access and download all the necessary data from the Web site of the FAO.An econometric model was used to see the contribution of agriculture in national economy of DCs and after analyze the influence of agriculture in GDP of China and selected SSA countries and then, examine the relation between agriculture and non-agriculture sector in these countries. We used Ordinary least squares method to draw the best-fit regression line, In case of SSA, three countries were selected through random sampling: Cameroon, Congo and Burkina Faso for the purposes of our disaggregate analysis.The results of the estimations carried out allow it to be concluded that:The regression analysis show that in China and SSA agriculture tends to have an impact on national economy growth and that is greater than its simple share in national GDP. A positive impact of agricultural growth on national economy, especially in the SSA is also clearly evident. The reason for this lack of symmetry between agricultural growth and national economy varies from country to country .The econometric model results show in China, historically a 1 percent increase in agricultural growth leads to between a 0.12 percent and 0.15 percent (for selected SSA countries) increases in nonagricultural growth. There appears also a reverse effect: a 1 percent increase in the nonagricultural growth rate leads to a decrease in agricultural growth in selected SSA. In countries (like Cameroon, Congo, Burkina Faso) nonagricultural growth appears not to be related one way or the other to subsequent agricultural growth.At look at individual countries shows wide variation. A substantial heterogeneity exists between countries, as illustrated by the case of all these countries. In all these countries except China, agricultural growth is positively related to subsequent nonagricultural growth and having very high elasticities of cross-sector growth impacts and this relationship for selected SSA countries is considerably above the regional average cross-sector growth elasticity of 0.12. Comparing China and SSA, we can note that: China has the strongest linkages (particularly forward) and the strongest cross sector growth elasticity. Cameroon has weaker linkages than China but stronger ones than Burkina Faso and Congo, and it has a cross-sector growth elasticity double that of the regional average. Burkina Faso and Congo have some similarity and has the weak linkages and cross-sector growth elasticity equal to the regional average.Furthermore we extended the definition of agriculture to include the food processing sectors. Using the same breakdown of these countries, the results indicate that China average cross-sector growth elasticity from agriculture to nonagricultural increases from 0.12 (excluding food processing) to 0.18 (including processing).In the case of China, this strongly suggests that the positive spillovers of agriculture are stronger when the sector's downstream industries are included in the "rural" economy. By contrast, adding the food processing industries to SSA agricultural sectors reduces the average cross-sector growth elasticity. This suggests that, in SSA, much of the subsequent growth in non-agriculture that is related to current primary agricultural growth is found in processing industries more closely related to agriculture. That is, a substantial part of what is measured as the non-agricultural growth correlated with agriculture is in the food processing sector. In China it appears that forward links have a longer reach into industries beyond food processing, probably due to level of economy development.If we consider both the direct contribution of agriculture (its share in GDP) plus its indirect contribution to other sectors, for China agriculture contributes about 12% its size in national economic as agriculture the basis of national economy, stable growth of agriculture continues to provide a vital foundation for high growth in the overall national economy.These changes have provided a major contribution to China's remarkable overall economic performance in the past 25 years, which has seen growth in real GDP average above 9% between 1990 and 2004 with even more rapid growth in trade and investment. A unique element of China's experience is that the bulk of the shift in employment has taken place within the rural economy, as agricultural workers moved to newly-developed non-agricultural industry, rather than through migration from rural to urban areas.For SSA one finds that agriculture "contributes" about 10% the size of the sector to national economic. The situation deteriorated sharply in SSA for which statistics were available, their average annual agricultural production growth rate fall from one period to the other which resulted to some extent in a smaller contribution by the agricultural sector to GDP, whereas the considerable proportion of the population working in the sector remained almost unchanged and moved from the rural sector to urban areas. For the best contribution, it will be important that development initiatives under any component, given its fundamental role in economic development in SSA. For example, good governance, infrastructure, policy reform, human resources development etc., all help to create an enabling environment for farmers to contribute more to SSA economic development. In short, agriculture must be the engine for overall economic growth in SSA.In SSA, non agriculture contributes slightly less than its share to GDP growth. In China the nonagricultural contribution is approximately equal to its share in GDP. The results suggest significant spillover effects of agriculture to non agriculture in these countries. Along with the lower income elasticity of demand for primary products, the above results imply all the more strongly that agricultural growth would lead over time to a lower share of agriculture in total GDP, which corresponds to historical trends.China as well in Cameroon, Congo and Burkina faso agriculture have an effect on GDP e.i. in all these countries agriculture influence significatively on national economy. Only while this effect is positive for China, Congo and Burkina -faso, in camerron was negative. This negative effect can be explained by the vigorous recovery of the general economic situation, which led to a total reduction of the agriculture place in economy of the country. In the same period of analysis for these countries the relation between non-agricultural sector and agriculture was positive and there to be a positive correlation between these two non-agricultural growth and agriculture growth.But the degree of correlationship between agriculture and GDP varies from country to country which has achieved different level of economic developement. This degree of correlationship is higher in China than in SSA. The Chinese government has always been considering agriculture as the basis of the national economy and made tremendous efforts to increase its agricultural output though economic reforms, increasing government capital investment in the agricultural sector, increasing inputs in production, adapting new technology and introducing improved seed varieties. Chinese leaders of three generations have, on various occasions, consistently emphasized the importance of agriculture, and paid tremendously attention to the growth of agricultural production. This is confirmed by the regression results.In SSA, although agriculture influence is significant, agricultural sector is not really reinforced by the government. The common factor between these countries is that they did not pursue good agricultural and rural development policies.In the same period of analysis for these countries the regression results represented graphically show the strong positive relationship between the non-agricultural growth and agriculture growth in national economy. There is a significant positive relationship between growth in the agricultural sector and growth in the nonagricultural sector. This is clear and positive association between growths in these two sectors in China, Cameroon, Congo and Burkina Faso. Good macroeconomic policy, for example, will help both sectors to grow independently.But there is also a causal connection, which can be explained fairly simply even though the model involves several steps. Differential economic growths between countries are not explained primarily by different growth in labor and capital. Another major factor is the productivity with which the labor and capital are used and across the range of DCs, differences in the rate of growth of total factor productivity are very substantial. Factor productivity is growing rapidly in China but is falling in SSAThis positive correlation between these two sectors can be explained first by the fact that, the growth in agricultural output can fuel growth in the non-agricultural economy through a variety of mechanisms, some direct and some indirect. Because agriculture's share of GDP declines steadily as part of the structural transformation accompanying economic growth, resources from the agricultural sector are released for use in higher productivity activities in the industrial or service sectors. These resources are used much more efficiently, and contribute more to economic growth, if they are freed from agriculture through rapid productivity growth, and if they are attracted to the non-agricultural sector by dynamic demand for factors of production.Second the model shows that the positivite interaction between the agricultural and non-agricultural sectors also can take place in input and output markets. For example in China and SSA selected countries produce most of their own food, and so the agricultural sector is an important, and often crucial, factor in food security at the aggregate level. In the early stages of industrialization, much of factory output depends on agricultural raw materials, and domestic supplies usually dominate because of high transportation costs for raw materials, high spoilage rates for unprocessed food commodities, and the need for timely deliveries to maintain efficient production levels in processing plants. These linkages between agricultural growth and growth in the non-agricultural economy can be modeled and estimated at three basic levels: the local or regional economy, the national economy, or in cross-country comparative perspective.The regression results confirm that the developing world says very little about the economic forces behind the decline of agriculture. The "traditional" explanations were summarized by Johnston and Mellor (1961) in three factors that might explain why agriculture's share in national GDP tends to decline with development:(a) Income elasticities of demand less than unity for agriculture; (b) agricultural expansion with a constant or declining farm labor force; and (c) technological progress that favors manufacturing.Policy lessons from the China experience which do not take into account the structural differences between the agrarian economies in these countries sketched above are likely to be misleading. In addition, any relevant policy lessons need to take into account specific country characteristics, particularly those pertaining to agrarian institutions which are likely to be different in individual countries both within and between the countries. Lack of attention to such regional and country specific factors is likely to lead to undue overgeneralizations. One such overgeneralization common to a large part of the existing literature is the view that low investment and growth in SSA agriculture has been due to the disincentive effects of over taxation of agriculture by the governments through the price or the terms of trade mechanism.These policies, however, are unlikely to solve the main problem that SSA governments aimed to tackle, namely the lack of integration of the vast majority of subsistence farmers in the national economy and the adverse infrastructural and technological conditions of production in the outlying regions.In sum, SSA is on the path of a progressive trend in food, agriculture and forestry sector and is fully committed to contribute its utmost towards global efforts on food for all. All-out efforts are thus made in the direction of developing the agriculture sector in SSA in accordance with one of the national economic objectives "Development of Agriculture as the base and all-round development of other sectors of the economy as well".
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