WEF_GrowAfrica_AnnualReport2014

2013 in Review
2013 in Review
2.3
Country
Report
Ethiopia
Transforming agriculture through
strong leadership and vision
2013 IN REVIEW
PROGRESS
Cross-sector partnerships seed good progress
on market-led agricultural transformation
Contributing nearly half of national GDP and half of all
employment, agriculture is a key sector for Ethiopia’s
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 GTP’s 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.
Of the 16 companies with Letters of Intent (LoIs)
for Ethiopia, most report steady progress with their
investments in 2013. Working in partnership with
government and farmer associations, a number of
these projects are poised for operational scale-up.
Separately, Heineken and Diageo are both engaging
growing numbers of farmer cooperatives in a significant
boost in the quality and quantity of barley production.
GUTS Agro Industry has secured an off-taker in the
World Food Programme (WFP) to whom they will
supply processed chickpeas as a supplementary food.
Yara invested in a potash project, while the ATA has
carried out soil analysis and developed a framework for
fertiliser blending across the country.
Meanwhile, government agencies actively improved
the enabling environment for sector investment into
agriculture in Ethiopia. Direct seed marketing was
launched, allowing private seed companies to create
parallel channels of distribution and marketing. This
in turn enabled a greater number of farmers to access
seed. Access to finance improved through input credit
schemes, and a Rural Finance Strategy was developed
with support from the Prime Minister’s Office for the
implementation of the Rural Financial Services Program
(RFS). The Ethiopian Investment Agency (EIA) also
moved closer to its goal of becoming a one-stop shop
for investors.
The maize value chain particularly benefitted from
cross-sector collaboration. A bumper harvest for 2013
meant a large quantity of maize was available for
processing and food aid purposes. The ATA facilitated
a new Maize Alliance between the GoE, farmer
cooperatives, USAID and WFP’s Purchase for Progress
(P4P) programme, leading to WFP’s largest worldwide
purchase from farmer cooperative sources. Another
case in point is the completion by Dupont of a new
storage warehouse and seed conditioning plant, which
alongside the new multi-partner Advanced Maize Seed
Adoption Program (AMSAP) should help further boost
smallholder production.
A few LoI companies did not advance plans as well
as hoped. These expressed frustration that – as their
investments were not directly aligned to ATA priorities
– they did not receive the support needed to forge
partnerships and overcome constraints. Constructively,
the ATA recognised this high demand for support
to companies and has accordingly established
a dedicated Public-Private Partnerships (PPP)
Management Unit within the ATA to fill this gap.
54
Ethiopia
Ethiopia
55