Professional Documents
Culture Documents
2013 in Review
2.3
Country Report
Ethiopia
Transforming agriculture through strong leadership and vision
Contributing nearly half of national GDP and half of all employment, agriculture is a key sector for Ethiopias rapidly growing $118.2 billion economy. Equipped with a competitive labour market and serving as a major regional hub with easy access to both the Common Market for Eastern and Southern Africa (COMESA) and the Middle-Eastern market, Ethiopian agriculture offers promising rewards for companies and a viable economic strategy through which the government can further its goals of reducing poverty and food insecurity. To that end, the country is pursuing a collaborative and balanced approach to transforming this pivotal sector. The 5-year Growth and Transformation Plan for 2011-2015 (GTP) and the Agricultural Development-led Industrialization (ADLI) strategy both offer a longterm vision and a mechanism for aligning efforts and initiatives behind those goals. The GTP objectives focus on enhancing the productivity and production of smallholder farmers and pastoralists, strengthening market systems, improving private-sector participation and engagement, expanding the area of land under irrigation, and reducing the number of chronically foodinsecure households. By collaborating with a strategic array of related partners, the Agricultural Transformation Agency (ATA) plays a leading role in ensuring the GTPs aims are fulfilled through partnership initiatives across three different levels: for each priority value chain (e.g. maize, teff, wheat, barley, sesame and chickpea), for each system or step of a value chain (e.g. soils, seeds, cooperatives and markets), and in respect of crosscutting issues (e.g. technology access, gender and climate). Ethiopia has its sights firmly set on ensuring domestic value-addition, with a view to building the local agroprocessing industry and leveraging private-sector experience to help the Government of Ethiopia (GoE) strengthen agricultural value chains. Several initiatives have been put in place with these purposes in mind, ranging from the provision of fiscal incentives to the building of hard infrastructure. There is a clear understanding within Ethiopia, across organisations and agencies, on the importance of agriculture a focus driven by government and widelysupported among the various pillars of society. This shared journey of Ethiopians towards transforming agriculture, so as to enable the country to live up to its immense potential, is steadily bearing fruit and gaining momentum.
2013 IN REVIEW
PROGRESS
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Ethiopia Ethiopia
2013 in Review
2013 in Review
LETTERS OF INTENT
Strategy setting
The GTP and the ADLI strategy offer a clear national vision and approach for transforming the sector. Priority value chains are well-established as a guide for investment. solutions and foreign exchange availability.
$29 million of investments made in 2013 $26 million of capital expenditure. $3 million of operating expenditure.
6 of 16 companies provided data.
Investment pipeline
Partnerships between companies, farmers cooperatives, the GoE and donors are catalysing investments within key value chains. Investment pipelines could be strengthened by further involvement of catalytic partners such as donor organisations, microfinance institutions (MFIs) and NGOs, as well as through further improvements to the enabling environment for private sector development and investments.
OUTCOMES REPORTED FOR 2013 1,042 jobs created: 174,000 smallholders reached:
25%
5 of 16 companies provided data, of which 80% was gender disaggregated.
75%
27%
52,320 with services 11,760 with sourcing 11,760 with production contracts 3,735 with training 98,002 unspecified
73%
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Ethiopia Ethiopia
2013 in Review
2013 in Review
SPOTLIGHT
CONSTRAINTS
Ethiosis will ensure farmers across Ethiopia understand the fertiliser that their soil needs.
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Ethiopia Ethiopia
2013 in Review
2013 in Review
Strong agricultural growth and investment must still deliver on eliminating poverty and hunger
Agriculture makes up nearly half of Ethiopias economy, making it one of the top 4 most agriculturally-based economies in the world. Since 2005, growth in the sector has stabilised at rates consistently above the 6% CAADP target. Roughly half of the rural population is directly engaged in agriculture as an economic activity, with a slight majority of that agricultural labour force composed of men. Ethiopias agricultural sector currently produces maize, sorghum, wheat, sugarcane and pulses in significant quantities, generating 9% of Africas annual maize production. Since 2004, Ethiopia has significantly increased agricultural spending as a percentage of its annual budget, raising it from 5% to 21.2% and far exceeding the CAADP expenditure target. Ethiopia is placed 125th in global rankings and 11th out of 47 in sub-Saharan Africa in the Ease of Doing Business report. The country is particularly wellranked with respect to contract enforcement. However, Starting a Business and Protecting Investors are both areas in need of particular improvement. Ethiopia is one of the most attractive environments on the continent for digital agribusiness services, with 22.1 million mobile GSM connections, 39% of which are 3G data connections, making it the most data-enabled mobile market out of the Grow Africa countries. For Ethiopias 96.5 million persons, extreme poverty (percentage of people living on less than $1.25/day) declined from 39% in 2005 to 30.7% in 2011. Child malnutrition is still extraordinarily high compared to other sub-Saharan countries, with 29.2% of children under 5 being underweight. Against this backdrop, Ethiopias stabilised agricultural growth is integral for progress towards achieving the Millennium Development Goals, especially for the vast majority of citizens who live in rural areas.
CAADP Target
CAADP TARGETS
96,506,000
37,026,000
29.2%
Child malnutrition:
% of children under 5 underweight (World Development Indicators, 2011)
30.7%
Poverty:
% living below $1.25/day (World Development Indicators, 2011) Rural population:
79,347,000
Public agriculture expenditure share in total public expenditure 1990 - 2010
Source: FAO-STAT 2014 - http://faostat.fao.org/
55.0%
Source: FAO-STAT 2014 - http://faostat.fao.org/
45.0%
Ethiopia
CAADP Target
Top 10 Crops by Production (tonnes) 6,158,318 3,604,262 3,434,706 2,700,000 2,690,165 1,781,652 Maize Sorghum Wheat Sugarcane Pulses Barley Sweet Potatoes Potatoes Millet Yams
Source: FAO-STAT 2014 http://faostat.fao.org/
25 20 15 10
Starting a Business 166 Getting Credit 109 Protecting Investors 157 Trading Across Borders 166 Enforcing Contracts 44
EASY 50 100 150 HARD
1,185,050 863,348
0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Source: ReSAKKS 2014 - www.resakss.org Source: World Bank 2014 - http://www.doingbusiness.org/
742,297 350,000
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Ethiopia Ethiopia
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2013 in Review
Goals
Diageo
Contribute to developing and implementing a scalable barley value-chain project with a potential to scale up sourcing (from 6,000 smallholders) to 20,000 tonnes p.a. by 2016 for local use and export.
Goals
Heineken
Increase the agricultural production capacity of rural households and limit the dependence on imported malt barley.:
DuPont
Contribute to increasing the productivity and sustainability of smallholders by: 1. investing in a new seed warehouse/conditioning plant; 2. co-developing a rapid soil information system for farmers; and 3. partnering to improve smallholder maize productivity through increased hybrid adoption.
New seed warehouse/conditioning plant completed and operational. Soil Testing Programme cancelled as no longer a priority for the GoE. Multi-partner Advanced Maize Seed Adoption Program (AMSAP) launched: steering committee formed, manager hired, 320 lead farmers identied, 20 farmer agro-dealers selected and trained, and 775 persons (including extension workers and farmers) trained. Conducted multiple eld visits to align stakeholders, and working with partners to scale up to reach 75,000 smallholders.
Swiss Re
Develop micro-insurance solutions to agricultural risks by investing in-kind to support development of sustainable agri-risk management markets, with a view to assisting farmers with production risk coverage, accessing nance and engaging in higher income-generating activities.
Partnerships forged with donors, businesses and governments for advancement of agri-risk transfer markets through International Finance Corporationfunded projects. Held local trainings and awareness-raising events. At pan-African level, 300,000 smallholders reached.
Foster the development of local farmers and supply partners by: 1. expanding food processing operations into baby foods, iodised salt, and corn-soy blends; 2. integrating further up the value chain in chickpeas; and 3. increasing local sourcing of maize, soybeans and chickpeas by 40-50,000 tonnes.
Reached 10,000 smallholders through three cooperative unions. Signed Memorandum of Understanding with WFP for production of chickpea-based ready-to-use supplementary food for a project which involved the WFP Country ofce in Ethiopia, the GoE, USAID, and PeSEco. Grant agreement with USAID (ACDI/VOCA) for production of chickpea-based product.
Goals
AGCO
Contribute to capacity building, knowledge transfer on the agronomic system and the intensication of agriculture and farming mechanisation by: 1. establishing a demonstration farm and training centre, together with global and local partners, aimed at large- to small-scale farmers, agriculture students and local schoolchildren; 2. providing infrastructure and technical support with mechanisation, storage and livestock systems, including after-sales services for commercial smallholders, and emerging and large-scale farmers; and 3. offering nance solutions and developing leasing models for tractor supply to small-scale farmers with little working capital.
Help improve the daily income and nutritional status of smallholders by: 1. expanding agreements with smallholders who (through cooperative unions) supply chickpeas, unshelled and shelled peanuts, and soybeans; 2. introducing commercially-viable nutritionally-rich products; 3. developing industry/university links to make improved technologies available to farmers; and 4. increasing local sourcing of cereals and legumes from 32,500 tonnes to 50,000 tonnes by 2015.
Construction of a National Agrifood Laboratory almost complete; This laboratory will ll the R&D gap and address quality issues to enable improved products to meet international standards and fetch better prices for smallholder farmers. Expanding operations in agro-processing and exploring regional trade opportunities.
Jain Irrigation
In line with national 2015 poverty reduction targets, contribute to developing irrigation and enabling infrastructure by: 1. developing an integrated agricultural cluster in an area identied as suitable; and 2. adopting modern technology in irrigation, agronomic practices, harvesting, supply-chain management and produce processing.
Currently partnering with METEC Metals and fabrication industry to produce irrigation technology and scale up initiatives for developing irrigation and infrastructure.
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2013 in Review
2013 in Review
Goals
Mullege
Scale up coffee operations and catalyse investment in other value chains by: 1. increasing local sourcing of coffee, oilseeds and pulses; 2. extending partnerships with local/international companies; and 3. directly impacting 90,000 smallholders by 2015.
Goals
Yara
Build plant nutrition knowledge and co-develop national fertiliser market by: 1. developing an integrated approach to horticulture and coffee value-chain initiatives; 2. creating a tailored agronomic package (of people, tools and services) to support national priorities; 3. fast-tracking business investment programme to link trade and distributor model aligned to specic crops; and 4. providing technical support to plant nutrition development capacity.
Netafim
Contribute to advancing irrigation systems for smallholders by: 1. piloting a household irrigation system, targeting 4050,000 smallholders over 5 years; 2. introducing large-scale drip irrigation projects in chickpea and/or sugarcane, in partnership with other companies working along the value chain; and 3. exploring 3 export-oriented projects in cooperation with local company partners in the coffee and banana value chains.
Completed pilot project in household irrigation based on Family Drip System. Collaborating with local partners on export-oriented projects, mainly in sugarcane, coffee and banana value chains.
The following investment plans exist, but no progress report has been shared for 2013.
Committed to exploring opportunities to partner with other investors to integrate chickpea into processing activities.
Omega Farms
Contribute to adoption of enhanced chickpea growing methods by: 1. sharing improved chickpea production trial results with interested smallholders; 2. expanding commercial chickpea farm activities that create linkages with smallholder out-growers; and 3. exploring opportunities to partner with other investors to integrate chickpea into processing activities (e.g. a plant to produce chickpea powder and hummus).
Goals
Bank of Abyssinia
Contribute (along with Zemen Bank) to improved nancial inclusion and mechanisation of agribusinesses by targeting lending facilities to agricultural equipment suppliers and leasing companies, in order to enable farmers to acquire necessary equipment and enhance farming yields. Contribute (along with the Bank of Abyssinia) to improved nancial inclusion and mechanisation of agribusinesses by targeting lending facilities to agricultural equipment suppliers and leasing companies, in order to enable farmers to acquire necessary equipment and enhance farming yields.
Zemen Bank
Syngenta
Launch productivity partnerships providing advice, knowledge transfer, and solutions to farmers by: 1. developing at least one value-chain partnership; 2. partnering with at least one large-scale farm to support development of specic crops; 3. bringing in new technology, such as seed varieties; and 4. investing in farmer training.
Expanding partnership with Fair Planet to commercialise vegetable seeds and train smallholders; conducted several eld visits. Value-chain partnership on chickpeas cancelled due to low priority for ATA. Conducted initial trials for tomato and planning to improve market connectivity in 2014; demonstrated 600% yield increases compared to Ethiopian average. Partnering with several large-scale farms (Saudi Star, SMP, Karaturi, Ruchi, and Jittu) to provide know-how, genetics and inputs, reaching 9,300 ha. Reached 44,000 smallholders through improved biotechnologies.
Contribute to improving productivity and income of small and marginal farmers of interest crops (corn, sorghum, sunower, canola, rice, cotton, forages, legumes and vegetables) through technology transfer via on-farm training schools (3,000 trainees planned in 1st year), and by acting as key input and knowledge partner to large farms.
Partnering with the International Fertilizer Development Center (IFDC). Conducting large-scale demonstrations of new sorghum seed technologies, which are better yielders and would improve productivity and farm incomes.
Highway investments are improving market access, but feeder roads remain a constraint.
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Forward Look
Forward Look
FORWARD LOOK
PRIORITIES FOR PROGRESS
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