Impact of climate change on agricultural production and food inflation in Southern Africa: a spatial panel data approach.

Abstract

The present study analyzes the impact of climate change on agricultural production and food inflation in Southern Africa by employing quantitative analysis of annual data from 1981 to 2020. Annual mean temperature and average rainfall are employed as proxies for climate change, the analysis focuses on the agricultural production and food inflation as the dependent variables. To assess the order of integration of both the regressands and regressors of interest, three panel unit root tests are employed; Levin, Lin and Chu (LLC); Im, Pesaran, and Shin (IPS); and Fisher Chi-square tests. Furthermore, the PMG/Panel ARDL approach for cointegration is employed to evaluate the long run relationship among the variables. The results indicate that temperature and rainfall patterns have a negative and significant impact on agricultural productivity as a 1C increase in temperature leads to 16.63 units of decrease in agricultural output. It could therefore be contended that the agricultural sector in Southern Africa is particularly at risk from climate change due to the unique geology and farming systems of this region. On the other hand, only temperature has a positive and significant impact on food inflation, since temperature is a critical determinant of crop yields, warmer temperatures negatively affect the growth cycles of staple crops by causing heat stress and reducing water availability, hence increased food prices. To mitigate these challenges, this study recommends climate-resilient farming practices, input tariff reductions, enhancement of regional trade integration, and support for renewable energies so that productivity improves while food prices remain stable. Flexible monetary policies and increased social protection measures will thus be substantially instrumental in safeguarding livelihoods and food security for the population, fostering a strong agricultural economy against both structural and climatic challenges.