22 May 2014 Development News (UPDATED)

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Ecobank and Eleni Join Forces to Strengthen Africa’s Agricultural Financing Capabilities

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ecobankeleni

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Ecobank Transnational Incorporated (‘Ecobank’ or ‘the Group’) has signed a memorandum of understanding (‘MOU’) with eleni LLC (‘eleni’), the leading proponent and developer of commodity exchanges in Africa, with a view to establishing a cooperative framework to promote and accelerate the development of Africa’s agriculture.

Mr. Albert Essien, Ecobank’s Group Chief Executive, and Dr. Eleni Gabre-Madhin, chief executive officer of eleni, signed the MOU at an official ceremony held during the AfDB’s Annual General Meeting in Kigali today.

Dr. Gabre-Madhin, a globally recognized thought leader in Africa’s development, is the former founder and CEO of the acclaimed Ethiopia Commodity Exchange (ECX), which has garnered various international awards and plaudits, including the Africa Investor Agriculture Initiative of the Year in 2011 and, a first in Africa, the CIO award for IT excellence in business. eleni LLC, established with co-founders Keith Thomas and Jawad Ali, is the only proven pioneer building commodity exchanges for frontier markets in Africa, with a demonstrated impact on the livelihoods of millions of smallholder farmers in Ethiopia.

The partnership between Ecobank and eleni aims to realize a shared vision of transforming Africa’s competitiveness in global commodity markets, enhancing value addition and processing in the domestic economy and enhancing food security. The partnership builds on the synergies between Ecobank’s unrivalled pan-African presence and its commitment to financial inclusion and eleni’s successful track record of creating and operating commodity exchanges in Africa, with projects in Ghana, Cameroon, Mozambique, and Nigeria. Ecobank recently announced that it was a keystone investor in the establishment of the Ghana Commodity Exchange (GCX), eleni’s first major foray in West Africa.

“As well as increasing market transparency and reducing transaction costs, commodity exchanges play a crucial role in the monitoring and assessment of risk,” commented Albert Essien, Ecobank’s Group CEO. “Instruments such as warehouse receipts reduce uncertainty and improve access to finance across the value chain. We look forward to collaborating further with eleni to enhance Africa’s agricultural financing capabilities.”

“We are very excited to be working with one of Africa’s leading financial institutions, with a solid pan-African focus, as this opens up a tremendous opportunity to establish the leading platform for commodity-related payments and transactions across the continent,” concluded Dr. Eleni Gabre-Madhin.

http://allafrica.com/stories/201405221708.html

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Alliance Generates Investments in Africa’s Agriculture

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21 May 2014

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Man holding two tomatoes standing behind tomato trays with another man in background (Feed the Future)

After investing in a new drip system and water pump, farm owner George Lawrence has seen the total income from his tomato and sweet pepper crops in Tanzania rise.

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Washington — A growing global alliance devoted to improving food security and nutrition now covers 10 African countries, includes more than 160 companies and has generated more than $7 billion in planned investments, according to a new U.S. report on accelerated progress to end global hunger.

The 2014 Feed the Future Progress Report, released May 19 in Washington, says that organizations supported by the New Alliance for Food Security and Nutrition are showing results. One organization is the Alliance for a Green Revolution in Africa (AGRA), established in 2006 by the Rockefeller and the Bill & Melinda Gates foundations.

AGRA leads a $47 million Scaling Seeds and Technologies Partnership to expand production by African companies of high-quality seeds and increase the number of smallholder farmers who have access to innovative technologies.

Through the New Alliance and Grow Africa, more than 2.6 million smallholders have been reached through services, training or production contracts and 33,000 jobs have been created.

Grow Africa seeks to accelerate investment and change in African agriculture based on national agricultural plans. Grow Africa supports the Comprehensive African Agricultural Development Programme (CAADP), established in 2003 by the African Union’s New Partnership for Africa’s Development (NEPAD). So far, 40 African countries have now completed national agricultural plans.

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Woman holding bucket of eggs (Feed the Future)

An employee of an Ethiopian poultry farm admires improved production as a result of advice from staff at the new Bishoftu Farm Service Center.

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The African Union has proclaimed 2014 as the “Year of Agriculture and Food Security.”

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In 2012, President Obama, African leaders and other members of the Group of Eight industrialized nations launched the New Alliance to significantly expand public-private partnerships and investment in smallholder agricultural development in sub-Saharan Africa. The New Alliance complements the Feed the Future program, which Obama launched in 2009 as part of an effort to leverage resources to improve food security, reduce malnutrition and strengthen resilience to recurrent crises in vulnerable areas of the Horn of Africa and the Sahel caused by climate change and other factors.

“I believe that the United States has a moral obligation to lead the fight against hunger and malnutrition … we’ve put the fight against hunger where it should be — at the forefront of global development,” Obama said in October 2012.

“Growth in the agriculture sector is a powerful driver in advancing economic opportunity, peace and security, markets and strong trading partners,” the report says. “We will win our fight against poverty and hunger by improving value chains and leveraging investment, trade and science” and by working with civil society and the private sector, it continues.

The New Alliance for Food Security and Nutrition focuses on Benin, Burkina Faso, Côte d’Ivoire, Ethiopia, Ghana, Malawi, Mozambique, Nigeria, Senegal and Tanzania.

The text of the 2014 Feed the Future Progress Report (PDF, 13MB) is available on the U.S. Agency for International Development’s website.

http://iipdigital.usembassy.gov/st/english/article/2014/05/20140521299510.html?CP.rss=true#axzz32PkRhAog

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Government plans to expand electricity access to 75% by 2015

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Ministry of Water, Irrigation and Energy (MoWIE) announced by the year 2015 it plans to expand access to electricity from the present 51 percent to 75 percent of Ethiopia’s population.
The move by the government will made to promote and support the development and expansion of social service as well as income generating activities in rural parts of the country, according to The Ethiopian Herald.
During the opening of a two day National Workshop, State Minister Kebede Gerba, commented the development of large scale hydropower projects is being done with assessments to environmental and social impacts of the projects.

Kebede also said developing small and micro hydropower has gained the attention of the government for they are suitable and economical in electrifying remote rural areas. In addition to this, they are helpful to establish agro processing plants and productive activities in rural part of the country.

He further noted since 2005 the country has shown great progress in the power sector by implementing Universal Electricity Access Program via grid expansion. In particular he lauded the success of the program with the supply of electricity to households of rural towns, villages and social service centers.

In addition to this, Kebede stated the government has established Off-grid Rural Electrification Fund in order to harmonize the efforts of grid expansion by involving the private sector and cooperatives.

http://www.waltainfo.com/index.php/explore/13480-government-plans-to-expand-electricity-access-to-75-by-2015-

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Special report| Ethiopian Sugar Corporation’s “May Day Dam”

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[HornAffairs staff Fetsum Berhane visited the project sites of Ethiopian Sugar Corporation this month. This is the first of his series of reports on the mega projects]

The construction of the May Day dam, a massive dam being built for irrigation of the Welkait sugar plantation, in Tigrai region, is now 30% complete.

A visit to the site by HornAffairs confirmed the completion of “the coffer dam”, which is part of the main dam that serves as a barrier between the main dam and the river.

May Day irrigation dam is being built on Zarema River, which joins Mereb River, a tributary of Blue Nile River. Zarema River is one of the four rivers that border the “Waldeba monastery’’ which is considered a holy land and believed to be a land designated not “to be tilled” by God.

The dam was named May Day to commemorate the area that served as a cadre and military training ground for TPLF, one of the member parties of the ruling coalition, exactly 23 years ago.

The construction of the dam on the river met a strong opposition from one of the two main Monks’ associations and other influential religious groupings.

(Horn affairs will present you the background and the current status of the Waldeba controversy in our upcoming series on sugar mega projects of the nation.)

The May Day dam is the main part of the Welkayt sugar mill project, which is one of the 5 mega projects of the government in its bid to become one of the top ten sugar exporters in the world.

The Welkayt sugar project is expected to produce 484,000 tons of sugar per year, almost equal to the current national consumption of 500,000 tons.

The dam is designed to be 147 meters high – which is about the height of Great Ethiopian Renaissance Dam – and 860 meters long with a water storage capacity of 3.5 billon m3.

The reservoir of the dam will cover about 9,000 hectares (ha) of land and is expected to irrigate 50,000 ha sugarcane plantation using only 25-30% of its water stock leaving enough water stock for year round fishing and transportation activities.

The construction of the dam was started in November 2012, but was delayed for a year due to design problems faced by the Federal Water Works Enterprise according to the project manager Ato Amenay Mesfin. Subsequently, a revised design was prepared by an Italian firm and the construction resumed with a local contractor, Sur Construction, in January 2014.

Diversion of the river, removal of loose soil and construction of the coffer dam were completed just five months before the arrival of the summer flood. The completion of this phase made possible the construction of the main dam without risk of damage. The dam is expected to be fully completed in the next three years, with filling of the reservoir planned to be conducted simultaneously.

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http://hornaffairs.com/en/2014/05/21/ethiopian-sugar-corporations-may-day-dam/

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Ethiopia’s sugar production could grow five-fold in a year

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Ethiopia’s massive investment in sugar development projects across the country could see the nation produce 1.58 million tons of sugar annually, five times its current output, by mid 2015.

The expected output is 70 percent of the government’s plan as stated under the five-year growth and transformation plan (GTP), which set out to produce 2.25 million tons of sugar per annum.
The government expects at least seven of the ten sugar manufacturing plants currently underway in five regional states to be completed by the end of the plan period (mid 2015).
The boost in sugar production could come as early as this month when the first phase of Tendaho sugar factory which has the capacity to crush 13,000 tons of cane per day (tcd) begins operation.
“Dry testing has been conducted and we expect the factory to begin crushing before the end of this month,” Shiferaw Jarso, Ethiopian Sugar Corporation (ESC) director general with a ministerial portfolio, said today at a press conference.

At full capacity, Tendaho factory will crush 26,000 tons of cane per day (tcd) and produce more than 619, 000 tons of sugar annually, making it the biggest sugar factory in the country.
Launched in 2006, the Tendaho project, which is being constructed by Overseas Infrastructure Alliance of India, predates the establishment of ESC and has been marred by delays.
Next in line is the Kuraz I sugar factory, one of the five sugar factories being built in South Omo Zone (SNNP region) with a combined annual production capacity of more than 1.9 million tons of sugar.
According to Shiferaw, Kuraz I, which will have 12,000 tcd crushing capacity, is expected to be completed in September 2014. Factory plant erection is being carried out by the Metal and Engineering Corporation (MetEC).
ESC also expects the year 2014 to witness the completion of Kessem sugar factory, a plant with an annual sugar production capacity of 260,000 tons at full capacity. The sugar plant is being built in Fentalle and Dulecha weredas of Afar regional state by China Complant Group Inc.

“The project is going very well and it is on schedule. We are confident that the plant will be completed in November,” Shiferaw said.
Two of the three sugar projects in Tana-Beles sugar development projects each with 12,000 tcd are expected to follow during the first months of 2015, according to ESC’s director general.
The remaining sugar development projects including Welkait sugar factory in Tigray region is expected to go operational during the GTP II period. The project received a 500 million dollars financial boost from China during the Chinese premier’s recent visit to Ethiopia.

“Construction of the plant will commence in June [2014] and it is expected to be completed in 24 months,” Shiefraw told journalists.
Currently, Ethiopia produces some 300,000 tons of sugar per annum while the demand for sugar stands at around 500,000 tons. The country’s sugar production is expected to not only satisfy domestic demand but will be an export commodity in the not-so-distant future.

At full capacity, the entire sugar development projects including those expected to roll out during the GTP II period is estimated to reach 4 million tons of sugar per annum.
With improved productivity the massive goal can be achieved, the director general believes.

http://www.waltainfo.com/index.php/explore/13469-ethiopias-sugar-production-could-grow-five-fold-in-a-year

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Ethiopia, China establish textile industrial zone in Addis Ababa

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The Ethiopian government is collaborating with a Chinese company, Zhejiang Jinda Flax Llc, to establish a textile industrial zone in Addis Ababa.

The Ethiopian Ministry of Industry and the Chinese textile company had signed a Memorandum of Understanding (MoU) for the industrial zone, designated for textile factories in the Bole District in Addis Ababa.

Available data shows that Ethiopia is home to over 230 textile and garment industries with 20 training institutes, employing about 37 per cent of the country’s public sector work force.

According to a copy of the MoU in Addis Ababa on Wednesday, the ministry would sign a formal Investment Agreement with the Chinese company at the end of July when the land needed for the project would be available.

The two parties had agreed to work jointly for the establishment, development and construction of the coming Kingdom Linen Textile Industrial Zone in Ethiopia.

Zhejiang Jinda is a subsidiary of Chinese Kingdom Holdings Limited and produces textile decoration fabrics such as weave fabrics, yarn decorated fabrics and calico (not fully processed fabrics) printing fabrics which are widely applied to clothing sofas, curtains and bed appliances.

The ministry agreed to provide the Chinese company with the Red Line and Coordinates Graph of the land and the soil analysis report of the future site of the industrial zone within two weeks after the agreement.

It said: “within two months of the signing of the Investment Agreement, investors will be granted all the necessary registration documents of the newly formed company in Ethiopia and the certificate of approval of investment of the project.

“Before June 2015, the Chinese company will commence the construction of phase one of the industrial zone project. In addition, the Chinese company will train 50 Ethiopians in industrial park production facilities.“

The ministry said it had allocated a total of 5,130 km in four cities and towns across the country, including Addis Ababa, Dire Dawa, a self-administered city about 515 km east of the capital.

Others are Kombolcha, 376 km to the north of the capital in Amhara region; Shillabo, 1,140 km from the capital in the Somali Regional State; Hawassa, 273 km south of the capital in the Southern Region.

11 Chinese companies are already involved in the manufacturing of leather and leather products, textile and garments.

http://sodere.com/profiles/blogs/ethiopia-china-establish-textile-industrial-zone-in-addis-ababa

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ETHIOPIA RECEIVES 250 MLN USD WORLD BANK LOAN FOR JOB CREATION PROJECT

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ADDIS ABABA, May 22 (NNN-ERTA) — Ethiopia has received a 250 million US dollar loan from the World Bank to support Ethiopia’s efforts in creating new jobs in manufacturing sector through the development of industrial zones in Addis Ababa and enhancing linkages with the local economy.

State Minister of Finance and Economic Development Ahmed Shide said Tuesday that the establishment of industrial zones would spur both foreign direct and domestic investments in Ethiopia.

The country is now “establishing industrial zones to use as a platform for catalyzing investment and job creation, with a focus on export-led manufacturing”, he added.

This project will provide large and medium-sized firms with new, serviced industrial land and buildings, including water, electricity, and transport connections, and with a one-stop shop to reduce the cost of doing business in Ethiopia.

It will also target small and medium enterprises (SMEs) which will act as local suppliers for the light manufacturing sector, as well as sector institutes which will be involved in project implementation and in developing skills and training of workers with requisite skills.

The World Bank’s country director for Ethiopia, Guang Zhe Chen, said: Tthe project will help strengthen the government’s jobs-creation agenda by drawing lessons learnt from global practices, as well as attracting new investors.”

http://www.namnewsnetwork.org/v3/read.php?id=MjY5MzEw

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Mega Projects cement Ethiopia’s renaissance: DPM Demeke Mekonnen

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Deputy Prime Minister Demeke Mekonne said that Mega Development Projects, fruits of May 28, have significant roles in cementing the bases for the realization of the renaissance of the country.

Forwarding his welfare message of the 23rd anniversary of May 28 to all Ethiopians, the completion of Sugar, Railway, Power, Road and other Mega Projects, which are undergoing as planned, will lay a base for sustainable strong economic development of the country.

In his exclusive interview with WIC, the Deputy Premier said that the Mega Projects, included in the Growth and Transformation Plan, will obviously cement the bases for the development of the country’s export led industrialization.

“If we, for instance take the Sugar Projects,” he said, “they will raise the country’s Foreign Exchange Income in addition to fulfilling the sugar demands of the country.”

They also give a room to the government to allocate the huge money that had been spending to purchases sugar from abroad to other development projects, Ato Demeke said.

According to the DPM, Ethiopia will be first in Africa and one among the major Sugar Exporters in the world after the completion of the Sugar Projects, which are currently under construction.

These mega projects, the fruits of May 28, will fortify the base of sustainable economy development, WIC learnt.

He also urged all Ethiopians to strengthen their participation and commitment to realize these pioneering development projects, he added.

Ethiopia is building an integrated economy, enhancing the agricultural sector in such a way that it could promote industrialization and vice versa, which has been laying bases for the realization of the renaissance of the country.

He also elaborated that the performance of the country’s Growth and Transformation Plan so far can be viewed in three dimensions: those projects completed before the period, those on the right truck with the same pace to the given period and those that lag behind.

The reduction of child mortality, job creation, expansion and development of microfinance institutions are some among money projects that performed beyond the target set in the GTP, he emphasized.

On the contrary, the reduction of mothers’ mortality, export and expansion of manufacturing are some of the sectors that lag behind, Ato Demeke added.

Most of the sectors are underway in line with the GTP period and will be completed by next year, the Deputy Premier stressed, adding that as the year 2015 is critical for us in accomplishing all of our GTP projects, the government along with the people will exert more consolidated efforts.

http://www.waltainfo.com/index.php/explore/13461-mega-projects-cement-ethiopias-renaissance-dpm-demeke-mekonnen

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French Companies Considering Investment in Ethiopia

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Four French companies, working on the areas of chemical, water technology, construction, and food processing industries, are looking at investment alternatives in Ethiopia.

As indicated in an investment forum hosted in Addis, French companies, which often prefer to invest in French Speaking Africa, are now turning their eyes to the fast growing economy in East Africa – Ethiopia, to make it one of their investment destinations in the continent.

Ethiopian Investment Agency briefed the companies’ delegates that manufacturing, leather and leather industry, mining, agriculture and tourism are the most promising areas of investment here.

The French delegates head, Mark Schneider said that they will invest in various areas once they identify their areas of preference.

http://allafrica.com/stories/201405220161.html

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 New Abattoir’s Construction to Commence in 4 Months

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The Addis Ababa Abattoirs Enterprise is going to commence construction for a new abattoir, Capital reported. The new abattoir is going to be situated at Hanna Mariam and the construction is expected to start after the last and fourth round of study has been completed. The study is expected to be finished within three to four months.

According to Efrem Desalegne, Managing Director of the Enterprise, the study has already costed 20 Million Birr. And the last phase of the study is expected to reveal the cost and duration of the construction. The study is being carried out by a meeting consortium group from South Africa, New Zealand and Australia.

According to Efrem, the new slaughter house will replace the old one and upon completion the latter will be used for other purposes.

The new abattoir is going to be on 17,400 square meters and it is going to have the capacity to handle 14,000 animals per day. Compared to this, the old slaughter house has the capacity of only slaughtering 1,200 animals per day.

The old abattoir has seen some improvements in the past years. Nonetheless, expansion and improvement projects faced difficulties due to space limitation. With the new slaughter house, the Enterprise expects to render different new services such as export slaughtering service and environmental mitigation actions.

The export service is expected to be given through an automatic line which can handle bulls, sheep and goats.

An upgrading system for processing by products to produce animal tallow, meat bone meal, glue and pure bone meal will also be installed in the new abattoir. In addition to these the new abattoir will feature a biogas plant and water treatment plant to enable the treatment of water and reuse of water.

http://www.2merkato.com/news/alerts/2964-ethiopia-new-abattoirs-construction-commence-in-4-months

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Not so fair trade

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BUYING ‘Fairtrade’ coffee is not really helping the very poor, new research suggests. By comparing living standards in Fairtrade-certified producing areas in Ethiopia and Uganda with similar non-Fairtrade regions, four development economists from the School of Oriental and African Studies (SOAS) in London found that Fair Trade agricultural workers often earned lower incomes.

After four years of fieldwork in the coffee, tea and flower sectors in Ethiopia and Uganda, where they gathered 1,700 survey responses and conducted more than 100 interviews, the SOAS researchers found people living in ordinary rural communities enjoyed a higher standard of living than seasonal and casual agricultural workers who received an apparently subsidised wage for producing Fairtrade exports. Women’s wages were especially low among producers selling into Fairtrade markets, according to the researchers.

Comparing areas where the same crops were produced by similar, though not Fairtrade-certified employers, they found that workers received higher wages and benefited from better conditions. This was not because the Fairtrade cooperatives were based in areas with higher or particular disadvantages. The rationale of Fairtrade is that producers of commodities subject to price volatility should be protected through payment of a minimum price to cover living and production costs, a price which adjusts whenever the market shifts above the minimum threshold. In addition to this, traders should pay workers a “social premium” of around 5-10% for development and technical assistance.

The SOAS research suggests that Fairtrade has failed to make a positive difference. Within the areas studied, the poorest (typically wage workers in Fairtrade initiatives), often lacked access to schools, health clinics, improved sanitation and other social projects, even when they had worked on accredited processing stations or for compliant producers.

PS: The Fairtrade Foundation has published a lengthy reply: “We note the innovative methodology and large sample size that SOAS’s research project has used to answer its three research questions, only one of which focuses on Fairtrade. We also note however that the study has not sought to evaluate the impact of Fairtrade’s model and interventions as it has not followed an impact evaluation methodology.”

http://www.economist.com/blogs/baobab/2014/05/agriculture-ethiopia-and-uganda

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Building a green and resilient economy in Ethiopia

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by Sarah McMullan

14010636870_39dea1f951

For us, anticipating, adapting to, and recovering from shocks are essential to our future.”  With those words, H. E. Hailemariam Dessalegn, Prime Minister of Ethiopia, highlighted the importance of resilience for his country.

In his inaugural address at the opening of the 2020 Conference on “Building Resilience for Food and Nutrition Security” Thursday evening, Prime Minister Hailemariam outlined recent steps his government has taken in its quest to become a “green and climate resilient” middle income country by 2025. These include a green economy strategy to rehabilitate degraded land, plant forests and build climate resilience in agriculture, water, irrigation, and energy.

Prime Minister Hailemariam noted the work of Ethiopia’s Agricultural Transformation Agency which aims to maximize the contribution of agriculture—the source of half the nation’s GDP and 80 percent of its employment— to the country’s development.  He also highlighted the resilience-building features of the Productive Safety Net Program, which provides conditional food and cash transfers to vulnerable households.  Acknowledging that there is still work to be done, he welcomed the opportunity at the conference to “share experiences and learn from others.”

http://reap.ifpri.info/2014/05/18/building-a-green-and-resilient-economy-in-ethiopia/

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Growing Africa’s agriculture 

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Sustainable commercial agricultural production is vital to the health and well-being of Africa’s economy and people. Smallholder farming accounts for the majority of African agricultural production, and subsistence agriculture – where farmers focus on producing what is needed to feed their families – is still widespread. In Uganda, for example, 86% of the population live in rural areas and rely on subsistence agriculture. Low inputs and low productivity result in stagnation, and stagnation in the developing world is equivalent to poverty, hunger and malnutrition.

As leader of a company that has been involved in Africa for over 100 years, I see enormous potential to more rapidly develop this area together with regional partners. There is a need for more partnerships between farmers, government, NGOs, local business and multinational corporations to accelerate Africa’s commercial agricultural growth. This will not only help thousands of farmers escape the subsistence trap but also offer benefits to all partners.

According to the Food and Agriculture Organization of the United Nations, the global demand for food is expected to increase by 60% by 2050. Smallholder farmers will need to play a key role in meeting the growing need. Africa’s food and beverage markets are to reach a threefold increase by 2030, the World Bank estimated in 2013, bringing more jobs, greater prosperity, less hunger and significantly more opportunity for farmers to compete globally.

There are, however, numerous challenges that subsistence farmers are faced with and that inhibit potential growth. These include limited access to infrastructure, to productivity-enhancing technologies and to education – issues that require substantial investment and long-term partnership of local business, farmers, corporations, governments and NGOs.

Two critical challenges are the inability to compete with low-priced international products – it is virtually impossible to compete with imported rice from Vietnam, for example – and the lack of access to a strong commercial market. These cause farmers to maintain production at levels merely enough to provide for their family, providing little or no incentive to invest in improved crops and fertilizers, or access to these products. As with cash crops such as cotton, coffee and tobacco, markets are most likely to be built on demand for the product and accelerated by large multinational corporations. Multinational companies such as Heineken can play a significant role in creating this demand, partnering with farmers, government and NGOs to help African agriculture gain a larger share of the world’s commercial market. Local sourcing creates shared value.

Heineken currently produces from 56 plants in 23 African countries and has made a Clinton Global Initiative commitment in 2011 to source 60% of its agricultural raw materials used in Africa within the continent by 2020. This is also part of the commitments we made under our Brewing a Better Future programme, Heineken’s approach to sustainability and one of our key business priorities. Together with the European Cooperative for Rural Development (EUCORD) and the Dutch Ministry of Foreign Affairs, we recently invested in three Public Private Partnership projects in Ethiopia, Rwanda and Sierra Leone and we appointed a local sourcing director to increase the focus on and coordination of these projects.

In the Democratic Republic of Congo, our commitment to train farmers to produce consistent volumes of high-quality rice has seen their average annual production increase by 62% between 2009 and 2012. We have committed to invest more than $4 million by 2017 to accelerate our sourcing initiatives in the region, which will reduce the number of crops imported from other countries, educate local farmers through support and training, and improve income for thousands of farmers and their families.

Through partnerships with government and international NGOs such as EUCORD, Heineken seeks to use its commitment to actively improve agricultural productivity in the countries in which we operate. Working together with NGOs, Heineken is using its agricultural experience and capacity to train and organize smallholder farmers to integrate as many rural families in their supply chain as possible. Our objective is to make the agricultural sector more competitive in order to lower the costs of local grains – both as a source for the agro-processing industry as well as for local food consumption.

For farmers, the benefits include improved agricultural knowledge, increased productivity and profitability, better food security and an improved overall livelihood. Governments will see improved employment, economic development and a growing international trading position. And for commercial corporations – whether local businesses or multinationals – the long-term benefits are significant as well. For Heineken, these include securing a long-term sustainable source of raw materials, reduced exposure to unavailability or potential volatile prices, reduced transport costs; and a smaller carbon footprint.

We believe in Africa and can see the immense opportunity it offers. We also realize it is our obligation to partner with the continent to stimulate sustained and sustainable growth. We are encouraged by the results of our partnerships and want to engage in dialogue with other multinationals, local business, farmers, NGOs and governments about successful partnering for shared supply chain value. Together, we will be able to stimulate the growth of a sustainable and commercial agricultural sector for Africa and take an important next step to increase the global food supply.

Author: Jean-François van Boxmeer is Chairman of the Executive Board & CEO, Heineken. He is a co-chair of the World Economic Forum on Africa 2014.

http://forumblog.org/2014/05/growing-africas-agriculture/

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