Fostering productivity in the rural and agricultural sector for inclusive growth in Asia and the Pacific

In recent years, income poverty has been declining steadily in the Asia-Pacific region, but rural poverty remains widespread and deep, and continues to pose a serious challenge for policymakers. Improving agricultural productivity has been a core strategy for economic development and poverty alleviation for several decades, as this type of productivity was thought to facilitate structural transformation, which enables “surplus agricultural labour†to find employment in nonagricultural sectors. However, it has now been realized that the share of agriculture in national output declines more rapidly than the share of agricultural employment in total employment, trapping millions in “unproductive†agriculture and making them relatively poorer. Understanding this process and identifying appropriate responses is critical for poverty alleviation and inclusive growth. Based on data analysis and policy reviews, in the present paper, it has been found that structural transformation processes are incomplete in many developing countries. Reducing rural poverty and promoting inclusive growth cannot be realized by confining to agriculture, but instead they can be achieved by seeking a broader policy framework that facilitates enhanced intersectoral linkages.