http://www.fao.org/economic/ess/ess-events/sdg-indicator-2a1/en/

1. Workshop on SDG Indicator 2.a.1;
Turin, Italy, 27-28 March 2018
INTERPRETING THE INDICATOR
Sangita Dubey, Senior Statistician/Team Leader, FAO
Titus Mwisomba, Manager of Agriculture Statistics, Tanzania Bureau of Statistics
Giulia Gonnella, Statistician, FAO

2. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (1)
Consider a country whose central government spends 3.5% of total
expenditures, or outlays, on agriculture; and has a sector whose
value-added is 3.5% of GDP:
𝑨𝑶𝑰 =
𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 𝑆ℎ𝑎𝑟𝑒 𝑜𝑓 𝐺𝑜𝑣𝑒𝑟𝑛𝑚𝑒𝑛𝑡 𝐸𝑥𝑝𝑒𝑛𝑑𝑖𝑡𝑢𝑟𝑒
Agriculture Value Added as Share of GDP
=
3.5
3.5
= 𝟏. 𝟎𝟎
AOI =1 means neutrality in the central government to the agricultural
sector relative to agriculture’s economic contribution.

3. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (2)
Botswana in 2015: central government expenditures of 50.563 billion BWP
(Botswana Pula), of which 2.099 was on agriculture; GDP of $14.390 billion,
and agriculture Value-Added of $0.312 billion.
𝑨𝑶𝑰 =
𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 𝑆ℎ𝑎𝑟𝑒 𝑜𝑓 𝐺𝑜𝑣𝑒𝑟𝑛𝑚𝑒𝑛𝑡 𝐸𝑥𝑝𝑒𝑛𝑑𝑖𝑡𝑢𝑟𝑒
Agriculture Value Added as Share of GDP
=
2.099
50.563
∗ 100
0.312
14.390
∗ 100
=
=
4.15
2.17
= 𝟏. 𝟗𝟏
AOI >1 means Botswana had a higher orientation by its central
government to the agricultural sector relative to agriculture’s economic
contribution

4. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (3)
Guinea-Bissau in 2015: central government expenditures of 86.302 billion
XOF (CFA Franc), of which 4.003 was on agriculture; GDP of $0.978 billion,
and agriculture Value-Added of $0.433 billion.
𝑨𝑶𝑰 =
𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 𝑆ℎ𝑎𝑟𝑒 𝑜𝑓 𝐺𝑜𝑣𝑒𝑟𝑛𝑚𝑒𝑛𝑡 𝐸𝑥𝑝𝑒𝑛𝑑𝑖𝑡𝑢𝑟𝑒
Agriculture Value Added as Share of GDP
=
4.003
86.302
∗ 100
0.433
0.978
∗ 100
=
=
4.64
44.27
= 𝟎. 𝟏𝟎
AOI <1 means Guinea-Bissau had a lower orientation by its central
government to the agricultural sector relative to agriculture’s economic
contribution

5. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (4)
AOI = 1 means a neutral orientation
of the central government towards
agriculture sector relative to the
sector’s contribution to the economy.
AOI >1 means a higher orientation of
the central government towards the
agriculture sector relative to the
sector’s contribution to the economy.
𝑨𝑶𝑰 =
4.15
2.17
= 𝟏. 𝟗𝟏
AOI < 1 means a lower orientation of
the central government towards the
agriculture sector relative to the
sector’s contribution to the economy.
𝑨𝑶𝑰 =
3.5
3.5
= 1.00
𝑨𝑶𝑰 =
4.64
44.27
= 𝟎. 𝟏𝟎

6. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (5)
AOI>1:
 “overinvestment” in agriculture;
 well developed agricultural and rural infrastructure with
diminishing marginal productivity to public investment;
and/or
 Response to high degrees of market failure relative to
other sectors?
AOI<1:
 “under investment” in agriculture;
 poorly developed agriculture and rural infrastructure; o
with high returns to public investment; and/or
 low degrees of market failure relative to other sectors?

7. INDICATOR 2.a.1 POLICY USE AND INTERPRETATION (6)
 In developing Indicator 2.a.1, FAO also considered the following
measures:
1. Level of government expenditures on agriculture:
• ignores differences in economic size across countries
2. Share of government expenditure on agriculture:
• ignores differences in sector size across countries.
3. AOI using general government expenditures (including
state and local)
• This ideal measure suffers from severe data collection
challenges for state and local government expenditures.

8. INDICATOR LIMITATIONS
• 2.a.1 reflects central government only.
• Underestimates AOI if agriculture is disproportionally
undertaken by state governments.
• AOI=1 may not be the right target for any country
• Difference in: degrees of decentralization, market
failures; income inequality and food insecurity.
• Still provides useful trend analysis, and comparisons
between countries with similar agriculture sectors.
• FAO to revise regional aggregation methodology
• Currently uses cold deck imputation of non-response

9. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
*For countries with data on Government Expenditures in Agriculture

10. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
*For countries with data on Government Expenditures in Agriculture

11. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
Regional Trends
*For countries with data on Government Expenditures in Agriculture

12. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
Regional Trends
*For countries with data on Government Expenditures in Agriculture
0.0
0.2
0.4
0.6
0.8
1.0
0
5
10
15
20
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Western Asia and Northern Africa Sub-Saharan Africa
Agriculture share of Government Expenditures (left-axis) Agriculture value added share of GDP (left-axis) AOI (right-axis)
Sharesinpercent
AgricultureOrientationIndex(AOI)
WORLDFOODPRICECRISIS
WORLDFOODPRICECRISIS

13. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
Regional Trends
*For countries with data on Government Expenditures in Agriculture

14. AFCAS25, Entebbe, Uganda 13-17 Nov 2017
Regional Trends
*For countries with data on Government Expenditures in Agriculture