Public agricultural financing, budget execution, and food and nutritional security outcomes in the DRC: evidence from time-series analysis

Résumé

Introduction The poor performance of the DRC’s agricultural sector contributes to endemic food insecurity and poor livelihoods for a substantial proportion of the population. However, there is a general expectation that these challenges could be addressed through increased investment in the sector, particularly through higher public budgetary allocations. Methods We conducted an empirical analysis to examine the links between public financing of the agricultural sector and the contribution of agricultural productivity to GDP and nutritional outcomes over three decades (1990 to 2023). We implemented the Vector Error Correction Model (VECM) on national-level data for GDP, national budget allocation (BA), and execution (BE) in the agricultural sector, the value added of the agricultural sector as a % of GDP (AVA), the terms of trade index, and the prevalence of stunting among children under five. Results and discussion Our VECM short-run dynamics results indicate that AVA was significantly ( R 2 = 0.81) explained by fluctuations in factors directly or indirectly associated with national budget allocation (BA), execution (BE), the terms of trade index, and the food and nutritional security patterns (prevalence of stunting among children under five). A negative lagged error correction term (−0.76; p < 0.001) confirmed long-run equilibrium, indicating that approximately 76% of the disequilibrium observed in the previous period is corrected each year. The dynamics of AVA were significant (−0.65; p < 0.001), indicating a corrective mechanism following previous fluctuations. Budget executions (BE) exhibited a positive and significant effect (4.38; p < 0.001), indicating that agricultural production depends more on the effective implementation of expenditures than on initial budget allocations (BA), which exhibited a non-significant effect, reflecting a gap between budget planning and implementation. The impulse response results indicated that a unit shock in BE generated a strong negative response in AVA that persisted over the forecast horizon. These results pointed to intricate flaws and widespread disruptions in the execution of public agricultural financing in DRC, which likely hinder productivity and related gains in food and nutritional security. Conclusions Our results highlight the importance of budget execution-related factors, authorization, disbursement, and use of funds, among complex factors like civil strife, which could be essential for priority consideration for supporting agricultural sector development in the DRC. Policy interventions should consider gaps in budget allocation and execution and develop strategies to reduce existing inefficiencies.

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