WEF_GrowAfrica_AnnualReport2014

Forward Look
Forward Look
FORWARD LOOK
Investment and Partnering Opportunities
PRIORITIES FOR PROGRESS
Rallying partners around agro-processing,
key crops and systems
Through its PPP Unit, the ATA is currently supporting
the Ethiopian Investment Agency (EIA) to transform
itself into a world-class investor promotion and
management agency. Being the key focal point for all
investors entering the economy, this would be a crucial
step towards improving the enabling and supporting
environment for investments in agriculture and agroprocessing.
In addition, the PPP Management Unit
within the ATA is identifying key business opportunities
within Ethiopian agriculture and building investor
profiles and detailed case studies for them. Work has
begun on the maize value chain and products such
as corn flakes, snacks and starch, with other crops
to follow, such as teff and chickpea. The PPP team
is now also working to support the private sector
beyond investment, looking to learn from experiences
of companies and share these with the EIA to develop
policy recommendations.
The GoE is focused on promoting value-addition,
specifically on agriculture through agro-processing.
There are currently 7 industrial zones being developed,
including specific agro-processing-focused zones.
Further, the Ministry of Industry is working with the UN
agencies UNIDO and FAO on analysing the practicality
of building Integrated Agro Food Parks (IAFP), to
help SMEs gain from economies of scale and reliable
infrastructure. Infrastructure investments will also
play an enabling role, including the Ethio-Djibouti
Rail Network, which is expected to be completed by
mid-2015 and will provide easy access to the port in
Djibouti.
Other key initiatives of the ATA and its partners include:
•¡
EthioSIS and fertiliser blending: the ATA is currently
developing a detailed soil map for Ethiopia that will
identify key nutrient levels and deficiencies. This
will be supported by 4 fertiliser-blending plants that
are being constructed, and will provide targeted
customised fertilisers to help improve soil nutrition,
and, hence, agricultural output.
•¡
Rural Finance Strategy: The Rural Financial Services
Program (RFS) is an initiative developed by the GoE
to increase credit access to rural households, raise
aggregate savings, and enable the emergence of a
robust rural financial system. With the finalisation of
a strategy for the Program and the Prime Minister’s
approval, the government is now forming a project
team to implement the RFS.
•¡
The Ministry of Agriculture has launched the Direct
Seed Marketing initiative, which allows private seed
companies to directly sell and market their products
to farmers, farmer cooperatives and unions. This is a
landmark step for the seed sector, which has beenhighly
regulated in the past, with all seed flowing
through state-owned agencies. This is a key area
for private seed companies to enter and support
the initiative through involvement in the piloting and
eventual roll-out across Ethiopia.
The following investment opportunities have been
identified by the ATA:
Import substitution opening for malt
barley production
The Ethiopian malt barley market is fast-growing at
15-20% per year, driven by corresponding growth in
beer consumption of approximately 20% p.a. Demand
for malt barley is expected to grow from 58,000 tonnes
in 2011 to 133,000 tonnes in 2016, while competition
is limited and unable to offer a high-quality product.
Brewers are importing 60% of their malt requirements,
creating attractive prospects for investment in
domestic production of high-quality malt barley.
Teff processing offers as-yet untapped
export possibilities
Teff is an indigenous gluten-free crop of Ethiopia with
unparalleled nutritional value. Ethiopia would serve as
an ideal base to create retail products for developed
markets, such as Europe and the US. Teff goods have
taken off in niche bakeries throughout these regions
but have not yet been marketed at scale, providing a
great first-mover advantage. Major product possibilities
include bread, biscuits and snacks.
Growth market investment scope in
priority-accorded maize value chain
Maize production has been growing at around 10%
over the last 10 years, with all maize in Ethiopia
currently non-GMO. Increasing urbanisation and
income levels have led to a significant demand for
corn snacks and corn flakes. Ethiopia imports over
50% of its current corn flakes consumption. This is
expected to rise even further, based on the roughly
30% increase in annual demand over the last 8 years.
Competition is low with the market served by only one
domestic player and highly-priced imports. In addition,
given the crop’s acknowledged status as a priority
value chain for the purposes of the national Growth
and Transformation Plan, there is also a considerable
government focus on promoting and facilitating
investments in maize production and processing.
Point of contact for investments
To express interest in or learn more about these
opportunities, contact:
Theobesta Yohannes
Ethiopian Agricultural Transformation Agency |
+251 011 557 0685 | theobesta.yohannes@ata.gov.et
The ATA continues to support scale-up of successful
value-chain initiatives. For example, for 2014 the
WFP’s P4P programme has contracted 29 farmers’
cooperative unions to deliver 40,000 tonnes of maize,
doubling last year’s volume. The Commercial Bank of
Ethiopia has committed nearly $5 million in financing
for the initiative.
Major brewers are engaging farmer cooperatives to expand barley production.
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Ethiopia
Ethiopia
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