Agricultural Efficiency Gains and Trade L iberalization in Sudan

Abstract

The traditional agriculture in Sudan occupies 60% of the total cultivated land and employs 65%of the agricultural population.Nevertheless, itis characterized by itslow crop productivity,which is mainlydriven by low technical efficiency, whiledrought andcivilconflictsthreatenmost of its areas countrywide.Therefore,it hascontributed only an average of 16% to the totalagricultural GDP during the last decade. This paper addresses from an empirical point of view thesectoral and macroeconomicimplicationsof agricultural efficiency improvement in Sudan andassesses the efficiency gains under the assumption of trade liberalization. Efficiencyimprovement experiments are implemented by augmenting the efficiency parameters of labor,capital, and land in a Computable General Equilibrium (CGE) framework. The CGE model of thestudy relies on the newly produced Sudanese Social Accounting Matrix (SAM), which providesdata on 10 agricultural sectors, 10 industrial sectors and 13 service sectors. Results show thatimproving the agriculturalefficiency would lead to improvements in GDP, welfare level, andtrade balance.In addition it would also improve the output and competitiveness of the Sudaneseagricultural exports and increase their strength to face the challenges of liberalization.