SPIS Toolbox - Significance of Agriculture in the Local Economy
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3.7 Significance of Agriculture in the Local Economy
This parameter examines the contribution of agriculture to a target area’s economy. Relevant indicators would include:
- Proportion of the population engaged in agriculture – the higher the proportion of the population practicing agriculture, the higher the probability of good market potential for SPIS. This is because there is a higher population that may be seeking to ensure their water security for farming. Also, there is a higher probability of favorable government and non-governmental interventions to ensure employment opportunities within the sector.
- Existing irrigation culture – practice of irrigation farming that is mostly powered through fossil fuels and electricity presents a ready market to shift to solar energy.
- Proportion of the GDP attributed to agriculture – regions with a significant proportion of GDP attributed to agriculture are likely to offer an attractive market for SPIS as agriculture would be an established economic driver. It is, however, important to take note of the main crops or livestock contributing to the GDP. For example, coffee and tea could be significant contributors but these do not present obvious avenues for SPIS uptake. This could be contrasted to the export of horticultural products (e.g. flowers and vegetables) which are water intensive and therefore ready markets for SPIS.
Outcome/Product
- Contribution of agriculture to the GDP
Data Requirement
- GDP figures
- Agricultural output numbers
- FAOstats
People/Stakeholders
- Government ministries in agriculture
Important Issues
- Although the economic contribution of agriculture to a country’s GDP may be steadily declining it may be in sight of the country's broad-based economic growth and agriculture may still be the broadest economic sector in terms of demographics, and plays a significant role in the nation’s overall socio-economic fabric.
- In addition to agriculture‘s contribution to the GDP, the type and method of agricultural practice should be assessed. Areas that practice irrigated farming would be more ideal markets for SPIS.
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