News Article

ADB, Ethiopian Govt Officials Discuss Financing Agricultural Sector

Addis Ababa, July 11, 2002 (Addis Tribune) - African Development Bank (ADB) officials and government officials met to discuss the recommendations of the Bank’s agricultural sector review and the potential areas of the Bank Group intervention in the sector within the framework of the strategies of the government of Ethiopia.

According to the organizers, the objective of the meeting includes to review the existing agricultural sector's work and performance, analyze sector constraints and potentials, review government policies and strategies and effect on the sector, review the effectiveness and impact of the Bank group intervention in the sector and lessons learnt as well as to propose the appropriate Bank Group areas of intervention and strategies.

In his opening statement, Dr. L.I. Umeh, Manager, Agriculture and Rural Development Department in North, East and South Region of the ADB, said the development of the agricultural sector is key to Ethiopia’s poverty reduction efforts since the majority of the population derive their livelihood from agriculture. The Bank, however, note that the performance of the agricultural sector in Ethiopia has been below potential, Dr. Umeh said. "This is despite the country’s large natural resources endowment. The weak agricultural growth has, in fact, been a major factor in rural poverty," Dr. Umeh said.

A study paper presented at the meeting stated that high incidence of poverty and thus low investment capacity in profitable agricultural ventures, lack of export diversification and widespread animal disease and parasites, slowing international trade especially with livestock, and inadequate private sector development and thus weak participation in sector operations, such as in marketing, irrigation and agro-processing are key broad sector development constraints.

"Inadequate manpower and weak institutional capacity: regionalisation and decentralization have meant more public officers being posted to the region. Trained personnel, especially for core competence (economists, accountants) are being lost to international NGOs and the private sector due to poor public salary structure, inadequate and erratic rainfall patterns and lack of relevant and location-specific hydrological data for irrigation planning are also some of the constraints," the paper further stated.

The bank is undertaking various projects in the sector, officials said. Currently, the total cost allocated by the bank amounts to 440 million USD. The Bebeka coffee plantation, Addis Ababa fuelwood project, agricultural line of credit, Teppi coffee development, Amibara drainage project and irrigation and Fincha factory projects among others are the Bank's completed projects in Ethiopia. The Bank has 15 completed projects.

Fincha sugar, Awash basin water, Omo-Ghibe master plan, Birr-Koga and Genale irrigation, Meat plant feasibility and Amibara drainage II are completed studies financed by the Bank.

Officials also stated that the national fertilizer sector, national livestock development and Koga irrigation and watershed management projects are the on-going projects, and pastoral area development and Genela-Dawa master plan studies are the on-going studies of the Bank.

Given the importance of agriculture for poverty reduction, the need to revitalize this sector cannot be overemphasized, Dr. Umeh highlighted.

About EATIC
The Ethio-American Trade & Investment Council (EATIC - www.eatic.org) is a non-profit, non-partisan, tax exempt membership organization of corporations and individuals dedicated to strengthening and facilitating trade and investment between Ethiopia and the United States of America. The Council believes that it can best accomplish this goal through education, focusing on broadening the respective knowledge of various social customs, cultural traditions and economic climate of both countries.

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