Types of RWH Description(shape of Water Introduce Tra No of structures

structure structure) holding d diti

capacity(m3 ona
) l
Plastic lined Underground trapezoidal  18
ponds ponds lined with plastic 60
Cemented Trapezoidal and lined with 60  12
ponds cement
Individual Rectangular and circular 60-100  32
ponds ponds without any lining
material
Community Circular ponds without any 200-400  11
ponds lining material
Boretta Constructed by gully 1000-30,000  15
embankment and most of
them shape less

Agriculture in Ethiopia

August 1, 2016Posted by: adminCategory: Agriculture, Blog Category, East Africa No Comments

Ethiopia is a landlocked country split by the Great Rift Valley. It is located in the Horn of Africa, bordering
six (6) countries: Djibouti and Somalia to the East, Eritrea to the North and Northeast, Kenya to the
South and Sudan and South Sudan to the West.

With a population of 94 million (2013) growing at annual rate of 2.5% in 2014, Ethiopia is the second-
most populous country in Africa (Moller, 2016). The country is the place of origin for the coffee (Arabica)
bean and sometimes referred to as the land of natural contrasts, home to vast fertile West, jungles, and
numerous rivers, and also the world’s hottest settlement of Dallol in its North. The real gross domestic
product (GDP) growth averaged at 10.9% between 2004 and 2014, which has leapfrogged and
positioned the country to become a middle-income country by 2025, after being the second poorest
country in the world in 2000 (Moller, 2016). Powered by considerable public infrastructure investment,
Ethiopia has witnessed a rapid and stable economic growth, in addition to a decrease in poverty to 30%
from 44% in the past decade.

Role Agriculture in Ethiopian economy

Agriculture is the mainstay of the Ethiopian economy, contributing 41.4% of the country’s gross
domestic product (GDP), 83.9% of the total exports, and 80% of all employment in the country
(Matousa, Todob, & Mojoc, 2013). Put in perspective, Ethiopia’s key agricultural sector has grown at an
annual rate of about 10% over the past decade; much faster than population growth. Other important
sectors are service and industrial sectors contributing 43% and 15.6% respectively (The World Factbook,
2016). On agriculture expenditure related metric, Ethiopia has dedicated an annual investment of about
14.7% of all government spending to the agriculture sector since 2003. Ethiopia is among the few
African countries that have consistently met both the African Union’s Comprehensive Africa Agricultural
Development Program (CAADP) targets of 10% increase in public investment in agriculture by the year
2008 and boosting agricultural production growth by 6% at least by 2015.

Although agriculture is one of Ethiopia’s most promising resource, the sector has been slowed down by
periodic drought, high levels of taxation and poor infrastructure that often make it hard and expensive
to get goods to market. Also, overgrazing, deforestation and high population density has led to massive
soil degradation leading to low productivity. The above problems have made it hard for the country to
feed itself—best exemplified by the dramatic 1984-85 famine. Since then, the country has experienced
similar occurrences that expose a sizeable population to humanitarian needs. As things stand, over 3
million Ethiopians need food and other humanitarian assistance annually (SIDA, 2015). However, a
critical look at the sector shows a high potential for self-sufficiency in grains and also for the
development export especially for livestock, vegetables, fruits and grains. Further, many other economic
activities depend on agriculture. These include processing, marketing and export of agricultural products
among others.

Sectoral overview

Ethiopia has about 51.3 million hectares of arable land. However, just over 20% is currently cultivated,
mainly by the smallholders. Over 50% of all smallholder farmers operate on one (1) hectare or less.
Smallholder producers, which are about 12 million households, account for about 95% of agricultural
GDP. Agricultural production is mainly subsistence, and a large portion of the country’s commodity
exports is provided by the small agricultural cash-crop sector.

Key agricultural sectors

Coffee & tea; Ethiopia has a great potential for coffee production, thanks to the country’s abundant
rainfall, optimum temperatures, conducive altitude and fertile soil. Over 60% of Ethiopian coffee is
produced as forest coffee, and therefore the use of fertilizers is usually unnecessary as the falling leaves
enrich forest floor. Also, the use of chemicals such as pesticides, fungicides among others is limited since
the high genetic diversity in the forest creates a balance between parasites and pests (Ethiopian Coffee
Exporters Association, 2016).

Ethiopia is Africa’s largest coffee producer, and the fifth world’s producer contributing some of the
world’s finest coffees. The country accounts for over 3% of the global coffee market. Coffee is by far the
country’s largest foreign exchange earner. In 2013/14, Ethiopia exported 190,734 metric tons earning
US$ 749 million. Some of the major destinations of the Ethiopian coffee are Germany, Saudi Arabia,
Japan, USA, Belgium and France, importing over 70% of the country’s total coffee exports (Tefera, Abu,
2015).

While Ethiopia has a potential to grow all types of tea, the country produces only black tea, with a
production capacity of 7,000 tons of black tea per annum. According to the country’s ministry of
industry, the tea industry has been lacking investment (Ethiopia’s Ministry of Industry, 2016). Thus,
investment potential exists in large-scale commercial tea production as well as modern tea packing and
blending industries.

Cereals; In FY 2014/15, cereals’ overall agricultural production increased by 45% (EUBFE, 2015). Maize,
for instance, is one of the most important crop in Ethiopia of which the country is Africa’s second biggest
maize producer. Mainly grown in SNNPR and Oromia regions in about 1.77 million ha. Other important
cereals are wheat and barley mainly in Oromia and some parts of Amhara Regions in about 1 million ha
and 1.4 million ha respectively. There are also opportunities for wheat production under irrigation in the
SNNPR, Afar, Gambella and Somali Regions.

Livestock & Fishery sector; Ethiopia’s livestock population is believed to be the largest in Africa, and
tenth in the world. The sector accounts for about 10% of Ethiopia’s export income, with leather and
leather products making up 7.5% and live animals 3.1%. The country is home to about 49 million heads
of cattle, 22 million heads of goats, 17 million heads of sheep and 38 million chickens. The country also
has demonstrated potential for fishery development in its freshwater lakes, reservoirs and rivers. Other
investment potential areas in this sector include fish, milk & meat processing, raising and fattening of
sheep, goat, cattle and camel (Ethiopia’s Ministry of Industry, 2016).
Ethiopia’s Investment potential

Ethiopia’s economy is growing with a wide range of opportunities for investment. However, Ethiopia
remains an unexploited market and untapped for investors. Out of the total investment projects
approved between 1992 and 2012, FDI’s share accounted for about 15.8%, with China, India, Germany,
Italy, Sudan, Turkey, Saudi Arabia, Yemen, the UK, Israel, Canada and the US being the major source of
FDI. While that was a great progress going with the country’s history, there has only been a slight
increase since 2012 both in the total number of projects and capital invested (Ethiopian Investment
Commission, 2015). The country’s continued public investments in infrastructure is remarkable as well
as its new industrial policy geared towards diversification and transformation of the economy (EUBFE,
2015).

Ethiopia has competitive advantages in agriculture and agro-processing and sugar owing to the country’s
favorable climatic conditions and types of soil suitable for the production of a variety of crops. The
conditions are suitable for growing major food crops such as cereals, pulses, and oilseeds. Some of the
sectors that also have great potential for investment include organic coffee cultivation, sugar cane, tea
and spices, cotton (and textile), a broad range of fruits and vegetables and cut flowers.

Ethiopia’s competitive market access

Apart from a population of around 94 million people (2013) positioning Ethiopia as potentially one of
Africa’s largest domestic markets, the above sectors are equally suitable for the fast-growing export
market. By virtue of being a COMESA member, bringing together 19 countries with a total population of
400 million, Ethiopia also has preferential market access to these countries. The country’s closeness to
the Middle East also gives potential market opportunities in addition to qualifying for preferential access
to the EU market under the EU’s Everything-But-Arms initiative and to the US markets under the AGOA
and the Generalized System of Preference (GSP). Ethiopian products have access to these markets quota
and duty-free.

Erickson Oduya, Research Associate at Infomineo – Know more about Erickson

References

Agricultural Transformation Agency. (2015). Annualy Report, 2013/14: Transforming Agriculture in

Ethiopia. Addis Ababa: ATA. Retrieved from http://bit.ly/2anaCE8
Ethiopian Coffee Exporters Association. (2016, July 24). Major Growing Areas. Retrieved from ECEA:
http://bit.ly/2agk7WM

Ethiopian Investment Commission. (2015). Ethiopia: A Preferred Location for Foreign Direct Investment
in Africa. Addis Ababa: Ethiopian Investment Commission. Retrieved from http://bit.ly/2a5fIUw

Ethiopia’s Ministry of Industry. (2016, July 24). Agricultre Sector Investment Opportunities. Retrieved
from Ministry of Industry: http://bit.ly/2aiahov

EUBFE. (2015). Ethiopia Economic and Trade Report. Addis Ababa: European Business Forum in Ethiopia.
Retrieved from http://bit.ly/2a1uQY6

Matousa, P., Todob, Y., & Mojoc, D. (2013). Roles of extension and ethno-religious networks in
acceptance of resource-conserving agriculture among Ethiopian farmers. International Journal of
Agricultural Sustainability 11(4) , 301-316.

Moller, L. C. (2016). Ethiopia’s Great Run: The Growth Acceleration and How to Pace It. Washington,
D.C.: World Bank. Retrieved from http://bit.ly/29HrOTI

SIDA. (2015). Ethiopia’s Humanitarian Crises Analysis. Addis Ababa. Retrieved from http://bit.ly/29S64Iv

Tefera, Abu. (2015). Ethiopia Coffee Annual MY15/16. USDA FAS. Retrieved from http://bit.ly/1FJj345

The World Factbook. (2016, July 11). Ethiopia Country Profile. Retrieved July 15, 2016, from
http://bit.ly/1yAYHLA
agriculture ethiopia investment in ethiopia