AFRICAS FOR LEASE SALE: ETHIOPIA agriculture lands for sale/lease procedures

Saturday, 26 February 2011

ETHIOPIA agriculture lands for sale/lease procedures

Introduction:-

Ethiopian government has revised its agricultural land lease price, which has been attracting many investors for the past years.

Government believes that agricultural land in the country was not getting proper value and protection. The directorate has now prepared revised agricultural land lease price and expect that it will soon be approved by the government.

According to the information New Business Ethiopia obtained from Ethiopian Ministry of Agriculture, the new lease price takes into consideration the distance of the farm to Djibouti port, Port Sudan and central market – Addis Ababa.

According to the Agricultural Investment Support Directorate at the ministry, which has prepared the revised lease price, if the farm is located 700 kms away from Addis Ababa, the investor is expected to pay 111 birr (around 8 USD) / hectare per annum for rain-fed agriculture.

As the area gets nearer to the central market Addis Ababa, the price will increase by 4.05 birr per kilometer and as it goes far from 700 kms from Addis Ababa, the price declines by 4.05 birr per kilometer.

When it comes to irrigation farming the lease price will be 158 birr per hectare per annum and it will increase or decrease per every kilometer by 4.17 birr. According to this draft lease term, this lease price is subject to revision in every 10 year. And the investors lease the land for 25 years for annual crops and 45 years for perennial crops.

The Directorate hopes that the revised price will encourage genuine investors; create competitive balance among investors and regional investment balance.

So far investors are not paying for water and the Ministry of water plans to introduce water fee as the current situation shows that some area residents like Afar have suffered from water shortage because of agricultural investment, especially when investors bring many daily-laborers to their farms from other parts of the country.

So far, the Directorate has identified 2.9 million hectares of land as potential for commercial agriculture all over the country. Out of this, three regions have transferred a total of 1.74 million hectare to the Directorate - 180,625 in Southern Region, 834,199 in Gambella and 724,984 in Benishangul Gumz Region.

Of which it has allotted a total of 59,931 hectares of land to investors - 34,431 in Southern region and 25,431 in Benishangul Gumz.

All commercial agricultures going on in the country including the giant Karuturi and Saudi Star agricultural projects are expected to sign the revised lease price agreement and are expected to be registered and monitored by this centralized Directorate.

The main reason for establishing this directorate by the Ministry is said will make sure that the land is used properly for the desired purpose (mainly generate foreign exchange by producing exportable agricultural products) by the investors.

“The Ministry has realized that previously land is abused by some investors. Some investors were renting the land they rented from government to others, while different regions do not have clear records on the size of land they distributed to investors,” says expert at the ministry, who choose to not to be named.

“In fact, some investors were not providing the necessary facilities such as healthcare for their employees who work on their farms, some investors do not even have transparent bookkeeping and pay taxes to the government properly,” she added.

The revised agricultural land lease price prepared by the directorate is expected to be approved by the government soon.

The directorate is established at the Federal Ministry of Agriculture and Rural Development in January 2009 to regulate all investments in agriculture.

Its mandate includes identifying potential land for agriculture in the country, taking this land from all regions and transferring it to investors. It also monitors activities of the investors and provides both technical and administrative support to these investors.

The previous agricultural land lease price varies from one region to another. For instance in Oromia Region if an investor wanted to be engaged in coffee, tea, sugarcane, or any other perennial crops on an area of more than 100 hectares, he/she will get land free of lease for the first 4 years.

Ethiopia is a country endowed with abundant and diversified natural resources and diverse climate. It has also several agro-ecological zones and sub-zones, each with its own physical and biological potential. These and other factors make the country favorable for undertaking investment in various areas.

The priority areas of investment that the Government most wants to attract Foreign direct investment/FDI/ as well as domestic investment include:

Horticulture,
Floriculture,
Agro-processing,
Textile and garment and
Leather and leather products

Other areas of investment include agriculture and allied activities (livestock’s, fishery, forestry, etc), mining, cement tourism, grade I construction, services such as health and education, hydropower, etc

This is a country of the bent back and the silver sickle, where virtually all the crops have felt the calloused fingers of the peasant farmer working his tiny parcel of state-owned land. The ox pulls the plough and the donkey the cart, and fertiliser counts as agricultural technology.

Chugging into this picture on a bright green John Deere tractor came Hanumantha Rao, a former sugarcane farmer from India who is at the forefront of a revolution sweeping through Ethiopian farming. He hurried up to a hilltop on his company's farm in Bako, four hours' drive from the capital, Addis Ababa, and swept out an arm to indicate the land he has leased from the government: 11,000 hectares to grow rice, maize and oil palms.

In the fields below, boreholes were being sunk and roads graded. An airstrip will soon allow for a crop-spraying plane. Besides the new tractor Rao had been riding on that morning, there were 30 more on site. That was not many, he insisted, and neither was the farm especially large.

Further west in Gambella, Karuturi Global, the listed Indian horticulture company that employs Rao, is bringing in 1,000 new tractors to work the 300,000 hectares it has leased – making it one of the biggest farms in the Horn of Africa, if not the continent. "It is 120 kilometres [75 miles] wide," Rao said proudly. "Three hours to cross by Jeep."

Ethiopia's great land lease project is moved swiftly ahead. In an effort to introduce large-scale commercial farming to the country, the government is offering up vast chunks of fertile farmland to local and foreign investors at almost giveaway rates. By 2013, 3m hectares of idle land is expected to have been allotted – equivalent to more than one fifth of the current land under cultivation in the country.

The move is part of a wider trend that has seen other African and Asian countries seek to take advantage of high global demand and the cost of crops by offering agricultural land to foreign companies, private equity funds and governments, particularly those of import-dependent Gulf countries.

If done properly, the investments have the potential to increase local food availability and create badly needed jobs. If not – as was the case with the attempt by the South Korean firm Daewoo to lease half of Madagascar's arable land to grow corn for export in 2008, a deal many saw as 21st- century colonialism – they could prove disastrous.

In a food-insecure country such as Ethiopia, where several million people rely on food aid, the idea of offering fertile land to outsiders has raised concerns. But government officials point out that Ethiopia has vast reserves of underused land – 60m hectares of the country's 74m hectares suitable for agriculture is not cultivated – and insist no local farmers will be adversely affected. Esayas Kebede, investment support co-ordinator at the agriculture ministry, said that foreign companies were essential for the move from subsistence to commercial farming, a key part of the country's development strategy.

"There is no crop that won't grow in Ethiopia but we cannot produce quantity and quality. Why? It's a vicious cycle of the lack of capital and technology," he said. "So leasing land is a real opportunity for us."

So too for Karuturi. The Bangalore-based company, which is the world's largest grower of roses, has negotiated an extraordinarily good deal with the government. For its farm in Bako, Karuturi is paying no rent for six years and then only 135 birr (£6.50) per hectare per year for the remainder of the 50-year lease. In Gambella, a remote and sparsely populated region close to Sudan, the rent is only 15 birr per hectare (73p).

The company believes the potential for large profits is so great that it plans to invest nearly $1bn in its Ethiopian agricultural operations, according to managing director Sai Ramakrishna Karuturi. Within eight years, he hopes to be producing 3m tonnes of cereals – mostly maize and rice – a year on the Gambella farm, as well as palm oil and sugar. Some of the produce will be sold in Sudan and Kenya – where the company is in talks with the US Agency for International Development to build grain silos at a border town. Like all the foreign land investors in Ethiopia, the company is free to export as much of its produce as it likes, but Sai Ramakrishna Karuturi said most would be sold domestically, where there is a ready market.

"Ethiopia is a food importer and will continue to be for some time. With the high cost of transportation in Africa, it does not make sense for us to try to export beyond the region."

As with land, labour is also extremely cheap. The minimum wage in Ethiopia is about 8 birr (39p) a day. Karuturi, which hopes eventually to employ 20,000 people on its two farms, says it pays 10 birr (49p) a day and provides meals to its workers.

Rao, general manager of the Bako farm, said there was no shortage of locals desperate for jobs. "People here are very poor. They would work for 1 birr, and no one else pays more than 5 birr. So we are paying double."

Outside the farm gates, the feeling about Karuturi among peasant farmers was mixed. The company's 11,000 hectares were fallow before it arrived – the black clay soil is rich in nutrients but difficult to work without a mechanical plough – but some locals had grazed their cattle there and used to cross the farm to the nearest river, which is no longer possible.

Teresa Agassa, a 38-year-old man in gumboots who works a one-hectare plot, said it was good that some local people now had jobs – even if the wage was too small. But he spoke enviously of Karuturi's tractors.

"They're only for the company's benefit. Maybe there can also be benefits for us – but we will only know in the future."

Ethiopia's farming revolution

In the late 1970s Ethiopia's communist regime nationalised all land, and private ownership remains outlawed. The millions of small-scale farmers work under licence from the state, and most plots are one hectare or less, which has hampered efforts to improve food security. But the centralised tenure system has made it easy for the government to offer hundreds of idle farms to investors at cheap rates. A detailed database contains information on soil types, weather patterns, the nearest rivers, and suitable crops. The agriculture ministry is advertising 1.68 million hectares of land in the Benishangul-Gumuz, South Omo and Gambella regions. The greatest interest has come from India and Saudi Arabia, including Saudi Star Agricultural Development, which is growing 10,000 hectares of rice in Gambella. Firms from other Arab countries, and from China, Japan and the US have also expressed strong interest in leasing land.

Indian farmers all set to acquire 50,000 hectares of farm land on lease in Ethiopia

CHANDIGARH: Punjab-based farmers, who are known for feeding the country, now want to try their hands offshore, with a group of progressive farmers all set to acquire 50,000 hectares of farm land on lease in Ethiopia for growing high-value cash crops, including pulses and maize.

“We will be inking a deal with the Ethiopia government next month for getting at least 50,000 hectares of area for growing crops like pulses and maize, which will be exported to India and Europe,” Confederation of Potato Seed Farmers President Sukhjit Singh Bhatti told here.

Bhatti will lead a delegation of 16 interested potato growers from Punjab to carry out farming in Ethiopia.

What encouraged these potato growers to try their hand at farming overseas was land availability at almost throwaway rates, duty free imports of capital goods and the zero duty on farm exports offered by Ethiopia.

“Unlike here, most of the agricultural land is with the Ethiopian government and it has offered us to acquire land on lease for a period ranging between 25 to 40 years at a nominal rate, which works out to Rs 400 per acre per annum in Indian currency. Moreover, we will not have to pay for the first five years of our operations,” he said.

Furthermore, the cropping pattern in Ethiopia is not that intense as it is in Punjab. “With less pressure on land there (Ethiopia), the soil will be suitable for growing pulses, maize and other cash crops,” he said, adding, “These crops will be exported to India and Europe.”

The Ethiopian government has also assured that it will not levy any duty on the import of machinery like farm implements and export of agricultural commodities.

The Ethiopian Ambassador to India led a delegation from Punjab to his country in the month of June and asked Punjab farmers to invest in farming. The Punjab farmers were shown three farm estates, including Oromia, Gambella and Ben Hul Gul by Ethiopian authorities when they visited the country.

According to Bhatti, the initial cost for farming in Ethiopia works out to Rs 1.5 crore per 100 hectares of land. “This cost involves spending on infrastructure, farm machinery and land development,” he said.

The idea of land cultivation in foreign country has also clicked with the Punjab government, as state-owned Punjab Agro plans to take eight farmers from the state to CIS countries including Uzbekistan, Azerbaijan, Ukraine and Kazakhstan next month to explore the possibility of cultivating land on lease and exporting fruits, vegetables, basmati rice, etc.

This year, the ambassadors of various African countries, including Tanzania and Uganda, visited Punjab and encouraged farmers of the state to till the land in their countries.

IFC Provides a $30 Million Loan Guarantee for Ethiopian Coffee Farmers The United States government on Thursday signed a $ 229.3 million agreement with Ethiopia

Ruchi Soya takes farm land on lease in Ethiopia

GRAIN, International non-profit NGO based in Spain

2008 Report by GRAIN: Seized: The 2008 landgrab for food and financial security

Pact with Govt to cultivate soyabean, set up processing unit.

Ruchi Soya Industries, one of the leading edible oil processors, on Friday announced a major farm land acquisition in Ethiopia for soybean cultivation.

The company said it has signed a memorandum of understanding with the Ethiopian Government for cultivation of soyabean and setting up a processing unit on 61775 acres in Ganmbella and Benishangul Gumaz States on a lease basis for 25 years.

It has an option to increase the area under cultivation to 123,550 acres. However, it did not reveal investment details.

Looking overseas

“Ethiopia has been chosen for agriculture investment considering the availability of labour, its strategic location and the Government support to boost foreign investment and development,” Ruchi Soya informed the stock exchanges on Friday.

The company’s closest competitor, KS Oils, in October last invested Rs 380 crore to acquire 53,000 acres at Kalimantan in Indonesia for palm plantation.

The funding was done through the wholly-owned subsidiary, KS Natural Resources, Singapore, which received a Rs 375-crore-infusion from the parent company.

The company had earlier bought 85,000 acres in two tranches in the last two years.

Constrained by the availability of cultivable land and hiccups in contract farming, Indian agricultural companies are looking at global destinations for backward integration.

Tie ups with State Govts

Ruchi Soya gained the potential to develop palm plantation of about 89,000 hectares by entering into tie-ups with various State governments.

The country would continue to depend on imports for its edible oil requirement.

The oilseeds coverage in the rabi season as on January 7 was lower by six per cent at 84.23 lakh hectares against 90.01 lakh hectares logged in the same period last year. Ms Shraddha Umarji, Research Analyst, NCDEX, said the dry weather had led to a decline in the acreage of the winter-sown oilseeds.

This may lead to a strain on edible oils supply, forcing imports.

The vegetable oil imports in November were at 753,966 tonnes (555,342 tonnes). Edible oils constituted 712,677 tonnes while non-edible oils import was at 41,289 tonnes.

“A lowering of import duties coupled with an increase in consumption and high price elasticity had resulted in large-scale imports,” she said.

Ruchi Soya stocks on the BSE were down marginally by 0.73 per cent at Rs 95 and KS Oils closed down 0.60 per cent at Rs 75.

International agricultural land deals award Ethiopian virgin lands to foreign companies

Published: 13 Aug 2009

China | EU | Ethiopia | FAO

During the last one year, the international media have reported with noticeable frequency on international agricultural land deals in Ethiopia.

Abugida Info | August 13th, 2009

Experts worry about negative consequences

By Genet Mersha

In Ethiopia, land is under government control and, therefore, cannot be sold or bought. Of the dozen or so African countries engaged in such deals, for varied reasons the cases of Ghana, Madagascar, Mali and the Sudan have also attracted similar attention. Perhaps the only commonality between Ethiopia and these countries is that they are all far ahead of others in that experience, as they have concluded several international farmland lease deals in the past five years. Nevertheless, much of the information is still under wraps.

Consequently, this venture into unknown territories by poor developing countries with weak institutional capacities and frail system of rule of law has sent worrying signals to concerned global citizens. This, thus, has placed the new mode of international agricultural land deals in developing countries under laser-sharp scrutiny. The more experts learn about the phenomenon of international farmland deals, the more concerned they become by the consequences of such deals between unequally matched partners. The fear is that, the hunger in many developing countries for farm investment from rich foreign companies may end up compelling them to hand over their only assets to international investors (through international contractual agreements).

Stefano Manservisi, director-general of aid and development at the European Commission says, “We are very concerned because this is another way to exploit developing countries… The poorest countries are selling commodities, they are exporting migrants and now they are selling their land from which they will not take any kind of benefit in terms of food or whatever.”

Of equal concern is the survivability of millions of small-scale farmers against the onslaught of competition by well-greased commercial farms. An analyst at the Forum for Biotechnology and Food Security in India says, “Outsourcing food production will ensure food security for investing countries but would leave behind a trail of hunger, starvation and food scarcities for local populations… The environmental tab of highly intensive farming—devastated soils, dry aquifer and ruined ecology from chemical infestation—will be left for the host country to pick up” (Guardian April 7, 2009).

Not least, against the backdrop of rapid global climatic change, the worry of those who have seen the light is the impact of fast expanding commercial agriculture on the natural environment. In this connection, without including existing commercial farms, recall that even the 13.3 million small-scale agricultural holders in Ethiopia open up over a million hectares of virgin lands annually, i.e., according to the Ethiopian Central Statistics Agency (CSA, 2008 Abstract).

Why worry about land rental deals?

International investors interested in African agriculture are fast growing in number. Their action is induced by the need of the rich with less endowed agricultural lands to ensure their continued supply of food with cheaper prices and winning the competition against ethanol. Others are interested in making more money. The objective of Chinese holdings in Ethiopia for sesame production, or the new Indian venture in Ethiopia into tea, bio-fuel, and sugarcane and cotton production has no any other reason.

Still others are keeping worried looks on the heavy burden of food prices on their balance of payments, as in the case of the Gulf Cooperation Council (GCC), which spent $10 billion in 2008 on food imports (Bahrain’s Gulf Daily News). Therefore, motivated by the need to counter this problem, the GCC have announced this year their desire to turn Africa as their breadbasket. The process has started by strengthening the GCC-Africa Co-operation Forum, funded by both OPEC Funds and national earmarks by the five member countries of the GCC had already held its first meeting in Bahrain recently. Initially, Mozambique, Senegal, Sudan and Tanzania have signed on. Thus, virgin farmlands have been selected and the infusion of huge investments has begun in earnest into these countries.

Oliver De Schutter, special envoy for food at the Office of the UN High Commissioner for Human Rights, says, “This is speculation betting on future prices. What we see now is that countries have lost trust in the international market. We know volatility will increase in the next few years. Land prices will continue to rise. Many deals are even now being negotiated. Not all are complete yet.”

Similarly, China has taken steps to produce sesame in Ethiopia as of this year, which is the first of its kind. Recall that Ethiopia is the fourth largest sesame producer in the world; its natural sesame from whitish Humera seeds and machine-washed from Wollega fetch highest prices. Other parts of Ethiopia also produce good sesame; but what they need is some help in improving the production techniques and the producers’ exposure to the market. This requires improved policies to enhance agricultural production and overcome the country’s weak export capacities that have stood as barrier before millions of producers.

Until now, China has been Ethiopia’s leading export destination for most of its sesame. The EU and the US that normally imported from India have also turned to Ethiopia’s natural sesame lately. Records on global exchanges indicate that 150 countries import sesame seeds. While the prospect for sesame producers is brightening up, clearly the tilt to involving millions of ill-equipped peasant producers in unmatched competition by China on fertile virgin lands mostly should be cause for serious concern for Ethiopia and its friends. Since August 2008, sesame has been fetching $1,380 per tonne in the international commodity market. The natural sesame from Ethiopia has been priced around $1,400 for sometime, according to Business Standard.

Consequently, it is hardly with unfounded reasons that such investor interests and the latest trends in African agriculture have compelled the international community to break its silence. The concern is that Sub-Saharan Africa is fast becoming a hotspot for international land acquisitions.

In terms of local responses so far, the controversy has ended up in the overthrow of the government in Madagascar. As its first action, Madagascar’s army backed leader last March cancelled a deal by South Korea’s Daewoo Logistics to lease a million hectares of Madagascar—equivalent to the size of Qatar—to grow food, according to Reuter. Ever since, Madagascar’s has been embroiled in serious instability and political polarization. In some other deal making countries, negative sentiments may be there, although for now governments and businesses have managed to prevent any possibilities for loud or violent forms of expression of resentment.

Growing international concerns

Meantime, at the international level fresh controversies have begun to brew amongst experts, individual activists, and non-governmental organizations. Many are urging international organizations to step up to the plate and do their job on behalf of people that are ignored by their governments. For now, much of the media reporting has remained superficial. It has been terribly short on essentials of the deals or essence of the on-going controversies. Last spring, different non-governmental organizations engaged the FAO and its experts in intense debates along that direction. Their concern zeroes in on what they referred to as “land grabs.” The point they are driving home is concern for the voiceless, stressing the imperative need for careful review of the future trend of agriculture in developing countries in general and food production in particular.

David Hillam, FAO deputy director in charge of the trade and markets division who opened the Washington conference entitled ‘Land Grab”: The Race for the World’s Farmlands’ last March expressed the overall concern cogently. He said, “Imagine empty trucks being driven into, say, Ethiopia, at the time of food shortages caused by war or drought, and being driven out again full of grain to feed people oversees…Can you imagine the political consequences? That is why proper legal structures need to be put into place to protect land rights, and why we should look at some form of international code of conduct.”

Ruth Meinzen-Dick, researcher at the Washington-based International Food Policy Research Institute (FPRI) encapsulated the essence of the debate at the international level to IPS saying, “The bargaining power in negotiating these agreements is on the side of the foreign investor, especially when its aspirations are supported by the host state or local elites.” Uwe Hoering, a German development expert, who followed these debates dubbed the whole land deal issue “a new form of agrarian colonialism.”

There is no doubt that the arrangements are complex. Let alone for the media, even professional researchers find it difficult to get a crack at it, even when vigorous analyses of such deals, filling the gaps and developing informed understanding of the opportunities and risks is a part of their vocation. What makes it complicated is the home governments’ role and connections with the robust, politically and financially well-wheeled investor companies, countries and individuals, not to speak of their ultimate objectives and the consequences. Whereas the media’s interest in the matter has aroused international curiosity, until recently concern over the matter has hardly moved beyond scratching the surface of the mega-million dollar international deals on agricultural lands.

Ethiopia, part of new study on international farmland lease arrangements

With the publication in May 2009 of a report entitled Land Grab or Development Opportunity? Agricultural investment and International Land Deals in Africa, the information gap for now is being filled somewhat. This international report, backed by an extensive research undertaken in Ethiopia, Ghana, Madagascar, Mali and Sudan—the very countries on which media reporting has sharply focussed, depends on data available in the countries. Case studies on legal arrangements were also conducted in Mozambique and Tanzania. The report is the outcome of collaborative efforts between FAO, the International Fund for Agricultural Development (IFAD) and the International Institute for Environment and Development (IIED).

Funding for the international research was provided by bilateral governmental agencies such as Danida (Denmark), DFID (UK), DGIS (the Netherlands), Irish Aid, Norad (Norway), SDC (Switzerland) and SIDA (Sweden). The publication of the report was funded by FAO, IFAD, and DFID, the latter through IIED.

The report stresses that land is central to identity, livelihoods and food security of peoples in the host countries. That in view, therefore, it does not shy from expressing its concerns boldly. Such is one that, for instance, many of the countries involved in this practice do not have in place institutional mechanisms to protect the rights of small-scale farmers and rights and interests of the local population, nor the environment. These countries also do not have qualified personnel and sufficient experiences in land markets to assess and determine land lease contracts in market values. For all that is known to date, in many instances deals have been kept either in total secrecy or under less transparent cover. This could be either the choice of host countries or those skilful international investor-negotiators wishing to keep their deals under wrap, or coincidence of the interests of both parties.

Where have the rental fees gone?

A question in the minds of citizens in these countries and around the world is whatever happened to the money, for instance, which is not even reported in the case of Ethiopia in the records of government treasury, or as part of income, for instance, in the national budget outlays. For example, the 2010 Ethiopian national budget was approved less than three months ago, with no reference at all to such incomes. If indeed, it is aggregated under the revenue section, it is long overdue that it was indicated specifically as revenue from land rental fees.

The finance ministry usually reports in national budgets sources of revenues and incomes such as direct and indirect taxes, foreign transfers, foreign aid and loans, private transfers, royalty, dividends and project support, etc. Why not this one? That would have been one helpful indication of what the monies from land rents are used for. Surprisingly, the information does not even appear anywhere in the quarterly and annual reports of the National Bank of Ethiopia (NBE).

Can there be an explanation for this? Or should we remain silenced for fear of labelling, as usual, those raising such a questions of national concern by government and its agents as work of the power hungry diaspora, or hired guns for the opposition that the regime portrays its questioners as anti-peace or anti-‘Ethiopian democracy’? This time no matter the label, we are all in it for our country’s future and, therefore, good citizens would not change their minds on the pressing need to put the information on contracts on agricultural lands with foreign firms and the incomes in the public realm.

Even in its cautious and minimalist approach, the above-mentioned international report indicates that land under investor claim in Ethiopia between 2004 and early 2009 to be 607,760 ha. FAO estimates put that as 1.39 % of suitable land for rain-fed agriculture. The number of projects over 1,000 ha is 157 and the total investment commitment is reported as $78,563,023, which is far down from the real figure. It certainly is not so huge in terms of magnitude.

The report also warns that these figures may not be all that there is to it. There are a number of deals that have not been reflected in the national data records. The authors attribute that partly to inadequate national record keeping system. For instance, although not in the public arena yet, the TribuneBusiness claims (March 2009), quoting the London Independent, Saudi Arabia alone had paid Ethiopia $100 million for farmlands in March to grow wheat and barley. Therefore, there is concern that some of them may not even be reported at all.

There is no doubt that good governance means transparency. Why should a government suppress information, unless it fears that its fingers will be held in fire? Therefore, there is no justification whatsoever for those government of Ethiopia, as it is involved in international farmland deals, to remain less transparent. It is duty bound to inform its citizens what the essentials of the deals it has signed are and to what purpose the monies are or have been utilized so far.

Transparency in practice would avoid the politically harmful suspicions of corruption, allegations of siphoning capital to foreign banks to which the name of the regime in Addis Ababa has often been mentioned. This means that, in addition to authoritarianism and violations of human rights, the land deals are conspiring to obliterate the regime’s image.

If this charge is allowed to continue in a hash-hash manner, as is the case now, it would prove to be an added impediment to the already weak national cohesion and national development in a politically polarized country. Its stigma is no less than the kiss of death. It would stain Ethiopia’s name. As usual in such circumstances, government may turn to suave American and British public relations firms to cleanse the regime’s image. I dare say, it would be to no avail in the face of evolving international campaigns that are gaining momentum.

A commentator on the London Independent article under the title ‘Land Grab”: The Race for the World’s Farmlands’ already wrote a letter that reflects the sentiment in the streets of Brussels, London, Rome and Washington. The writer of the articles says, “The real problem is that the elite in African countries are desperate to take cash from foreigners. They then apply this cash to purchase ‘security and defense equipment.’ And this is turned on the locals, especially locals who have their own ideas on what should be the land policy. This is not new colonialism. It is the elite of Africa (a combination of soldiers, thugs and opportunist politicians) strengthening their own power base.”

Data sources for the report, the pros and cons of the issue in outsiders’ eyes

The purpose of the international report is to highlight both the opportunities and risks involved in international agricultural land deals. Its authors say governments in different countries are their sources of information. They emphasize they have reviewed national inventories of approved and proposed land acquisitions in those countries, conducted interviews with concerned national officials and international experts, including reviewing the relevant literatures on the matter.

Of special significance is that the report has benefited from links with a parallel study led by the World Bank, involving FAO and IIED early on. Overall, the report sheds some light on some information and provides reasonable understanding of the state of such arrangements. While it attempts to make recommendations, especially for the benefit of the host countries, some critics of the report see them as inadequate, ‘wishy-washy’ and dismiss them by virtue of that as being of little value to developing countries.

Critics, amongst them, Uwe Hoering, a German development expert, accuse the report of “emphasises on the macro-economic advantages that the foreign grab of African land could represent, such as higher state revenues, and new chances of development in rural areas. But when it comes down to formulating norms to be applied to guarantee that African national interests are respected, it can only provide weak suggestions which, in addition, (it says) should be voluntarily applied and not too restrictive for the foreign investors.”

The Economist expressed its concerns from two different angles. Whereas it sees the values of “foreign investment in some of the most miserable places on earth” that these farmland leases drive, it worries about the fact that “most of these deals are shrouded in mystery.” It adds, “This is rarely a good sign, especially in countries riddled with corruption… Secrecy makes it impossible to know whether farms are really getting more efficient or whether the deals are done mainly to line politicians’ pockets. Next, most of these deals are government-to-government. This raises awkward questions. Foreign investment helps countries not only by applying new technology but also by reorganising the way people work and by keeping an eye on costs. Few governments do this well, corrupt ones least of all” (May 21st edition).

Case of land lease in Ethiopia

The international report states, “Obtaining geo-referencing for approved and proposed land deals proved difficult in most country studies, though in Ethiopia data obtained by the country team enables plotting investment amounts and land area sizes by region against FAO data on land suitability [see map below]. The map suggests that documented land deals tend to concentrate in regions with more fertile lands and/or closer links to markets. This mapping exercise only gives a broad-brush picture of the spatial distribution of land deals, however.” This FAO map is unpublished; it is reproduced here from the international report.

DOCUMENTED LAND ACQUISITIONS IN ETHIOPIA, 2004-2009

[caption id="attachment_6845" align="aligncenter" width="300" caption="Sources: country studies; FAO (2009); FAO unpublished "]Sources: country studies; FAO (2009); FAO unpublished [/caption]

In their reviews of national inventories, the authors of the international report have established that since 2004 Ethiopia, Ghana, Madagascar, Mali and Sudan have approved allocations of 2,492,684 ha of farmlands. For the five countries, this is exclusive of allocations below 1,000 ha. The report contends that its figures may not necessarily be complete, especially in land sizes and the revenues thereon.

So far, there has been limited information in the public arena on the full details of Ethiopia’s land deals with foreign companies or foreign government’s and individuals. What is reported on the foreign media is a German company that has been working for some time now on biofuel project on about 13,000 ha. Another German entrepreneur has been allocated 150,000 ha for livestock project. In addition, land has been leased to Saudi Arabia for report commercial farming of rice, which is augmented recently with palm oil production. Not known also clearly has been the sizes of farms held by Ethiopians in partnership with foreign individuals and companies.

Other than the above, what is public knowledge is on 21 July 2008 Prime Minister Meles had given President Omar Ismail Gulleh of Djibouti 7,000 ha of land to grow wheat. In addition, Mr. Gulleh is a recipient of 10,000 sq. m. of lakeside land 45 km from Addis Ababa to build commercial farming of rice, which is augmented recently with palm oil production. A few years back, the president has already built his villa in Dire Dawa, whose value is estimated $5 million, according to news sources. Of course, what is not disclosed to Ethiopians is what their leaders have received from foreign governments.

The unavailability of information to the public gives the impression that in Ethiopia’s case the genesis of international deals on agricultural lands is August 2008, after Prime Minister Meles Zenawi announced on the Financial Times that Ethiopia was “eager to give Saudi Arabian investors access to hundreds of thousands of ha of farmlands for investment and development.” That impression/or inadequate information has been inaccurate, since we now know from the international report, Ethiopia has been at the forefront of the renting of farmlands to foreign companies and, in some cases, to foreign state enterprises since 2004.

More land allocation made official in Ethiopia

The Ethiopian government has recently set up the Agricultural Investment Support outfit to deal with land lease and related issues. The director of that agency on 29 July told Reuter in Addis Ababa of the marking of 1.6 ha of land “for investors willing to develop commercial farms.” Ethiopia is so much after more deals now that it has put into its farmlands offers many attractive goodies.

“Investors who qualify have the opportunity to receive loans from local banks up to 70.0 percent of their capital investment as well as attractive incentives and tax holiday,” according to the director of the newly established office quoted by Reuter. It appears that no lesson has been taken from bank loans to foreign investors in the horticultural sector, some of which vanished without traces, even payment of what they owed to their labourers. They have only left their significant contributions to the already substantially high stock of non-performing loans on the books of Ethiopian banks.

There is an indication by an Ethiopian government official that land selection and allocation is carried out by the regional states. He says that was the case in Afar, Amhara, Benishangul Gumuz, Oromia and the SNNP regions. Not mentioned in the list by the official is Tigray region. However, FAO’s unpublished aerial map shows an allocation of as much as 7,500 ha (see map above).

It is reported that foreign firms that have started operation include a Chinese company aiming to produce sesame seeds, Indian companies engaged in the production of sugar cane, tea and cotton and bio-fuel. In addition to rice, wheat and barley, a Saudi Arabian company has contracted to work on palm oil production. One of the findings of the report is that private companies rather than foreign state-owned entities own the major shares of the approved investments.

Criteria for land allocation in Ethiopia

All land lease projects documented by the national inventory in Ethiopia involve allocations of (or applications for) government leases of diverse durations from 10 to 50 years (e.g. 10, 30 or 50 years). In determining what lands are to be allocated to foreign investors, the seemingly applicable determinants are whether land is “available”, “idle” or “waste” to justify allocation. These concepts feature quite prominently in some of the other countries mentioned in the report as well.

In Ethiopia, for example, all land allocations recorded at the national investment promotion agency are classified as “wastelands”, i.e., no pre-existing users. A critical analysis by the researchers has found that was not the case indeed. At least, some of the lands allocated to investors in the Benishangul Gumuz and Afar regions have been in use previously for shifting cultivation and dry-season grazing, respectively. In this connection, recall that in a July 29 interview with Reuter, the Ethiopian official in charge of the recently formed Agricultural Investment Support claimed, “The regional states set aside virgin land suitable for large-scale commercial farming.” It is not clear how the regional officials give away land that could be needed by the farming/herding population on rotational basis.

In Ethiopia, land rents are split into four deals out of the six projects the report’s research team has examined. Several deals – including the contract from the Benishangul Gumuz Regional State—involve five-year exemptions from land fees, as shown in article 4(a) of the contract. Prices range from $3 to $10 per hectare per year. It is clear to anyone that these fees are low, let alone in the international context but also for domestic commercial farmers. In recognizing that, so far only the rental fees in Oromia have been somewhat raised recently.

As mentioned above, significant levels of tax incentives are given to investors in Ethiopia. For example, profit tax in Ethiopia estimated at $20 per hectare per year is exempt for a period of five years. As a result, for 602,760 ha allocated of the documented projects is estimated to entail tax revenue loss to Ethiopia over five years of $60,276,000.

How reliable are land lease information?

Although government agencies are its primary sources, the international report acknowledges that information on land size deals may vary from the reality on the ground. It speculates that this may be because a share of international land deals is hardly reflected in government statistics. In Ethiopia’s case, for example, enquiries at the state-level Oromia investment promotion agency found evidence of some 22 proposed or actual land deals, of which nine were over 1,000 ha, and were not recorded along with the other 148 in the national investment promotion agency records.

The report is of the view that it is possible to those state-level agencies in other Ethiopian states may also have records of additional projects that some land acquisition deals may not have been recorded at all. Furthermore, the report acknowledges, “Datasets tend to be incomplete, which translates in gaps in its analysis. For example, in Ethiopia information about the land size of many deals proposed or concluded in 2008 is missing.” In addition, an investment by German company Flora EcoPower was reported to involve 13,000 ha (Reuters, 2009), while it is recorded at the Ethiopian investment promotion agency as 3,800 ha only.

Why does Ethiopia need international land lease?

It is this writer’s view that, although the Ethiopian government is unwilling to admit publicly the failure of its agricultural policy, its efforts in trying to attract foreign investors with hefty incentives is clear evidence of that failure. Moreover, already its 2010 budget allocation places agriculture to a third place in terms of priority, sign of its discouragement, or sign of resigning responsibility and relegating food production to foreign companies. This is happening for the first time since the regime assumed power, a further affirmation of its policy failures. In equal measures, what its action dose is arouse serious doubts about the future of agriculture in the country.

Yet, in inviting international investors, the government’s intention on one hand is said to be to improve the country’s food production capacity and on the other to earn more foreign exchange. Ninety-eight percent of the agricultural projects recorded at the Ethiopian Investment Promotion Agency involve food production, compared to only two percent for bio-fuels (though in terms of land area the split is slightly different: 94 percent versus six percent), according to the international report. However, the little told story in Ethiopia is the quiet retreat of domestic investment from agriculture, which is not a good omen for the rural population.

The statement by the director of the Ethiopian Agricultural Investment Support is understandably cautious. In response to the question how much food production by foreign companies would contribute to the domestic economy, his response was, “The contribution to the country’s economy of those companies that began work is yet to be quantified.” One thing that is not clear is also how the government intends to reconcile its expressed interests with its contractual agreements, where it is seen leaning backwards to the breaking point. Most of the contracts do not specify what percentage of production would be slated for export and to the domestic market, not to speak of government’s capacity to benefit in foreign exchange from the farmland lessees’ export revenues.

A different perception

Nevertheless, those that may go along with the government’s actions say they keep an open mind about its deals, despite their acceptance of the enormous future problems that many foresee. For instance, VOX (June 2009), a publisher of research-based analysis, writes, “The agricultural sector in developing countries is in urgent need of capital. Decades of low investment have meant stagnating productivity and production levels. In order to halve the world’s hungry by 2015, as targeted by Millennium Development Goals, FAO calculations show that at least $30 billion of additional funds are required annually…Developing countries’ capacity to fill these gaps is limited and official development assistance is no real alternative… The question is not whether international investments should provide a supplement to other capital inflows, but how their impact can be optimised.”

Unfortunately, VO/X’s sympathy has an obvious blind spot. It ignores the plight of millions of small-scale farmers that are beyond the reach of domestic and foreign capital and technology and cannot compete with international firms with rich backstopping and years of experience. This is more so at a time when those little domestic resources are beginning to ignore them, as shown in the case of Ethiopia’s national budget for 2010. Foreign aid has been known for its lack of sympathy and provision of real investments for agriculture in developing countries.

On the other hand, a comparison of data by the international report between FDI and domestic investment in Ethiopia, Ghana, Madagascar and Mali suggests the majority of the investment involves higher shares of FDI. However, what surprised the authors of the report is the extent to which national entrepreneurs and companies are also acquiring land in some of those five African countries, which it says its mention is virtually ignored in the international media reporting.

In Ethiopia, domestic investors account for the large majority of commercial agricultural projects. The sum of their land deals add up to 362,000 ha and an investment of $54 million, compared with 240,000 ha and $24 million for FDI. Given recent developments on the matter, there is no doubt that the data may have already been outdated in both Ethiopia and the other countries where case studies were undertaken. Details not known clearly have also been the sizes of farms held by Ethiopians in partnership with foreign individuals and companies.

Why is the outside world so concerned about international land leases in Africa?

The simple answer could be the fact of it being a new practice in a region whose institutions have terribly failed citizens and many African governmental practices are linked to corruption. Therefore, the various concerns discussed in the international report and in the news media could be summarized as lack of experience by government agencies in land deals, environmental considerations, corruption, the inability of the voiceless to defend their interests and possibility of opening up the host countries to speculator-investors.

The report has found out that the terms and conditions of investment on agricultural lands display a huge diversity among countries and even individual projects. It indicates that its main findings, which are based on a small number of international land deals, include the need to take account of:

* Land deals must be assessed in the light of the often complex overall package they are part of, including commitments on investment, infrastructure development and employment – the “land grab” emphasized by some media is only part of the equation;

* Land leases, rather than purchases, are predominant in Africa, and host country governments tend to play a key role in allocating them;

* Land fees and other monetary transfers are not the main host country benefit, not least due to the difficulty of setting land prices in the absence of well-established formal land markets;

* Host country benefits are mainly seen in the form of investor commitments on investment levels, employment creation and infrastructure development – though these commitments tend to lack teeth in the overall structure of documented land deals.

The report candidly states, “Although on paper some countries have progressive laws and procedures that seek to increase local voice and benefit, big gaps between theory and practice, between statute books and reality on the ground result in major costs being internalized by local people – but also in difficulties for investor companies. Many countries do not have in place legal or procedural mechanisms to protect local rights and take account of local interests, livelihoods and welfare. Even in the minority of countries where legal requirements for community consultation are in place, processes to negotiate land access with communities remain unsatisfactory. Lack of transparency and of checks and balances in contract negotiations creates a breeding ground for corruption and deals that do not maximize the public interest. Insecure use rights on state-owned land, inaccessible registration procedures, vaguely defined productive use requirements, legislative gaps, and compensation limited to loss of improvements like crops and trees (thus excluding loss of land) all undermine the position of local people.

Virtually all the contracts analyzed by this study tend to be short and simple compared to the economic reality of the transaction. Key issues like strengthening mechanisms to monitor or enforce compliance with investor commitments, maximizing government revenues and clarifying their distribution, promoting business models that maximize local benefit (such as employment creation and infrastructure development), as well as balancing food security concerns in both home and host countries are dealt with by vague provisions if at all.”

Why should Ethiopians be concerned about international land lease agreements?

The terms of farmland deals are hardly made public. Although a theoretical possibility exists in a few cases for some transfer of technology for agricultural development, risk also exists to peasant farmers who cannot compete with well-resourced commercial farms. Take, for instance, the case of barley and oilseeds producers in Ethiopia. China is given an unknown size of farmland to produce oilseeds, sesame especially. Saudi Arabia is also given unquantified land to produce barley and wheat. In the case of China, if our country’s experience to date were of any relevance, they would definitely bring Chinese workers to do the job. This not only would deny the country employment possibilities but also the transfer of experience and technology would be minimal, which otherwise FDI has been credited for.

At the same time, for the last several years China has been Ethiopia’s important destination for sesame export. China uses sesame for chocolates, biscuits, and extraction of oil for both its external and domestic markets. If China were to satisfy its enormous needs for oilseeds and its export revenues through its own production in Ethiopia, the marketing disadvantage would surely be to Ethiopia. There is also the possibility that this may drive prices down on two accounts. First, the major importer, china, may not need its share of Ethiopian exports. Secondly, Chinese possibility of overproduction could drive prices down. On top of that, Ethiopia’s weak export capacities are likely to be depressed during this competition with China. It is obvious that the competition would hurt millions of small-scale farmers in Ethiopia.

For instance, land under oilseeds in 2008 fell to 707 thousand ha from its high of 797 thousand ha, because of price discouragements to small-scale farmers. With it also declined the export volume and foreign exchange earnings, at a time when international prices were much higher than the previous years and more countries were interested in Ethiopian production. Surprisingly, over the years small-scale farmers’ production of sesame has shown consistent but limited productivity growth.

Perhaps, decline in international prices was one of the factors affecting decline of sesame farmland sizes in 2008, compared to 2005/06. Land under sesame by small-scale framers in 2008 was 186 thousand ha, which is 26.3 percent of the total land devoted to oilseeds, down from 211.3 ha in 2005/06, according to the CSA. Therefore, the emergence of a highly competitive partner now in sesame production may end up being another discouragement to million of small-scale farmers.

Strengthening such concerns is also the Chinese business model itself, about which Prof. Desta, Asayeghn has written extensively under the title China’s South-South Cooperative Investments. He says, “Unless corrected, the Sino-African investment is likely to fatten the pockets of state elites and marginalize the African masses. In line with the objectives of the South-South Cooperation, the degree of control must be reversed if there is going to be technological transfers from China to Africa. Also, China has done little to integrate Africa into the global value chains. It is claimed that Chinese-capital investments in Africa are new (Greenfield) rather than takeover investments. Chinese investments in Africa are constrained by not being environmentally friendly. Though an essential part of the technology transfer package, it is worth mentioning that a review of the literature shows that the Sino-African investments, similar to the Euro-African, have failed to handle Africa’s negative environmental externalities.”

What is said about sesame production by China is also true about the future of barley farmers. There has been slight improvement in barley productivity growth. In 2005/06, lands under barley were 998 thousand ha, which picked up in 2006/07 to one million ha. However, by 2007/08, like sesame, it plummeted to 985 thousand ha, an indication of the price factor in 2006/07. In the light of this, any possible prospect for small-scale holder agriculture in Ethiopian may face its worst nightmare. Alternatively, would the competition by foreign commercial farms become a positive force to the millions of small-scale farmers producing cereals, pulses, oilseeds or would they be compelled to shift to producing something else?

The trigger for this article, i.e., the above-mentioned international report, warns, “Decisions taken today will have major repercussions for the livelihoods and food security of many, for decades to come. This means that choices made now must be based on strategic thinking rather than piecemeal and opportunistic negotiations.” In the best interests of her country and her fellow citizens, this writer fully concurs with that assessment and conclusion.

Source: Abugida Info

Comments

The lease fees seems to be very low compared to the price of farmland on the world open market. The locals must also benefit from these deals apart from lease fees.

hugo lambrechts

Ethiopia, the farm commodity, is a cheap sale for foreign farms

By Xan Rice in Bako, Ethiopia Guardian | Posted to the Web January 15, 2010

[Update - Mumbai, Jan 15 (Reuters) - Ruchi Soya Industries Ltd said on Friday it has signed a pact with government of Ethiopia for cultivation and processing of soybean on lease basis. The company plans to cultivate soybean on 61,775 acres of land over a period of 25 years, it said in a statement to the Bombay Stock Exchange. The acreage may increase upto 123,550 acres, it stated.]

"Ethiopia is a food importer and will continue to be for some time. With the high cost of transportation in Africa, it does not make sense for us to try to export beyond the region."

"They're only for the company's benefit. Maybe there can also be benefits for us – but we will only know in the future."

Ethiopia's farming revolution

In the late 1970s Ethiopia's communist regime nationalised all land, and private ownership remains outlawed. The millions of small-scale farmers work under licence from the state, and most plots are one hectare or less, which has hampered efforts to improve food security. But the centralised tenure system has made it easy for the government to offer hundreds of idle farms to investors at cheap rates. A detailed database contains information on soil types, weather patterns, the nearest rivers, and suitable crops. The agriculture ministry is advertising 1.68 million hectares of land in the Benishangul-Gumuz, South Omo and Gambella regions. The greatest interest has come from India and Saudi Arabia, including Saudi Star Agricultural Development, which is growing 10,000 hectares of rice in Gambella. Firms from other Arab countries, and from China, Japan and the US have also expressed strong interest in leasing land.

Ethiomedia.com - An African-American news and views website.

Ethiopian ‘virgin land’ for sale

According to the World Bank, as much as three-quarters of Ethiopia’s arable land is not under cultivation, and agronomists say that with substantial capital expenditure, much of it could become bountiful. Since the world food crisis, Meles Zenawi, a former Marxist rebel who has turned into a champion of private capital, has publicly said he is “very eager” to attract foreign farm investors by offering them what the government describes as “virgin land.”

Dr. Robert Zeigler, an eminent American botanist, flew to Saudi Arabia in March for a series of high-level discussions about the future of the kingdom’s food supply. Saudi leaders were frightened: heavily dependent on imports, they had seen the price of rice and wheat, their dietary staples, fluctuate violently on the world market over the previous three years, at one point doubling in just a few months. The Saudis, rich in oil money but poor in arable land, were groping for a strategy to ensure that they could continue to meet the appetites of a growing population, and they wanted Zeigler’s expertise.

There are basically two ways to increase the supply of food: find new fields to plant or invent ways to multiply what existing ones yield. Zeigler runs the International Rice Research Institute, which is devoted to the latter course, employing science to expand the size of harvests. During the so-called Green Revolution of the 1960s, the institute’s laboratory developed “miracle rice,” a high-yielding strain that has been credited with saving millions of people from famine. Zeigler went to Saudi Arabia hoping that the wealthy kingdom might offer money for the basic research that leads to such technological breakthroughs. Instead, to his surprise, he discovered that the Saudis wanted to attack the problem from the opposite direction. They were looking for land.

In a series of meetings, Saudi government officials, bankers and agribusiness executives told an institute delegation led by Zeigler that they intended to spend billions of dollars to establish plantations to produce rice and other staple crops in African nations like Mali, Senegal, Sudan and Ethiopia. “They laid out this incredible plan,” Zeigler recalled. He was flabbergasted, not only by the scale of the projects but also by the audacity of their setting. Africa, the world’s most famished continent, can’t currently feed itself, let alone foreign markets.

The American scientist was catching a glimpse of an emerging test of the world’s food resources, one that has begun to take shape over the last year, largely outside the bounds of international scrutiny. A variety of factors — some transitory, like the spike in food prices, and others intractable, like global population growth and water scarcity — have created a market for farmland, as rich but resource-deprived nations in the Middle East, Asia and elsewhere seek to outsource their food production to places where fields are cheap and abundant. Because much of the world’s arable land is already in use — almost 90 percent, according to one estimate, if you take out forests and fragile ecosystems — the search has led to the countries least touched by development, in Africa. According to a recent study by the World Bank and the United Nations Food and Agriculture Organization, one of the earth’s last large reserves of underused land is the billion-acre Guinea Savannah zone, a crescent-shaped swath that runs east across Africa all the way to Ethiopia, and southward to Congo and Angola.

Foreign investors — some of them representing governments, some of them private interests — are promising to construct infrastructure, bring new technologies, create jobs and boost the productivity of underused land so that it not only feeds overseas markets but also feeds more Africans. (More than a third of the continent’s population is malnourished.) They’ve found that impoverished governments are often only too welcoming, offering land at giveaway prices. A few transactions have received significant publicity, like Kenya’s deal to lease nearly 100,000 acres to the Qatari government in return for financing a new port, or South Korea’s agreement to develop almost 400 square miles in Tanzania. But many other land deals, of near-unprecedented size, have been sealed with little fanfare.

Investors who are taking part in the land rush say they are confronting a primal fear, a situation in which food is unavailable at any price. Over the 30 years between the mid-1970s and the middle of this decade, grain supplies soared and prices fell by about half, a steady trend that led many experts to believe that there was no limit to humanity’s capacity to feed itself. But in 2006, the situation reversed, in concert with a wider commodities boom. Food prices increased slightly that year, rose by a quarter in 2007 and skyrocketed in 2008. Surplus-producing countries like Argentina and Vietnam, worried about feeding their own populations, placed restrictions on exports. American consumers, if they noticed the food crisis at all, saw it in modestly inflated supermarket bills, especially for meat and dairy products. But to many countries — not just in the Middle East but also import-dependent nations like South Korea and Japan — the specter of hyperinflation and hoarding presented an existential threat.

“When some governments stop exporting rice or wheat, it becomes a real, serious problem for people that don’t have full self-sufficiency,” said Al Arabi Mohammed Hamdi, an economic adviser to the Arab Authority for Agricultural Investment and Development. Sitting in his office in Dubai, overlooking the cargo-laden wooden boats moored along the city’s creek, Hamdi told me his view, that the only way to assure food security is to control the means of production.

Hamdi’s agency, which coordinates investments on behalf of 20 member states, has recently announced several projects, including a tentative $250 million joint venture with two private companies, which is slated to receive heavy subsidies from a Saudi program called the King Abdullah Initiative for Saudi Agricultural Investment Abroad. He said the main fields of investment for the project would most likely be Sudan and Ethiopia, countries with favorable climates that are situated just across the Red Sea. Hamdi waved a sheaf of memos that had just arrived on his desk, which he said were from another partner, Sheik Mansour Bin Zayed Al Nahyan, a billionaire member of the royal family of the emirate of Abu Dhabi, who has shown interest in acquiring land in Sudan and Eritrea. “There is no problem about money,” Hamdi said. “It’s about where and how.”

A long the dirt road that runs to Lake Ziway, a teardrop in the furrow of Ethiopia’s Great Rift Valley, farmers drove their donkey carts past a little orange-domed Orthodox church, and the tombs of their ancestors, decorated with vivid murals of horses and cattle. Between clusters of huts that looked as if they were constructed of matchsticks, there were wide-open wheat fields, where skinny young men were tilling the soil with wooden plows and teams of oxen. And then, nearing the lake, a fence appeared, closing off the countryside behind taut strings of barbed wire.

All through the Rift Valley region, my travel companion, an Ethiopian economist, had taken to pointing out all the new fence posts, standing naked and knobby like freshly cut saplings — mundane signifiers, he said, of the recent rush for Ethiopian land. In the old days, he told me, farmers rarely bothered with such formal lines of demarcation, but now the country’s earth is in demand. This fence, though, was different from the others — it stretched on for a mile or more. Behind it, we could glimpse a vast expanse of dark volcanic soil, recently turned over by tractors. “So,” said my guide, “this belongs to the sheik.”

He meant Sheik Mohammed Al Amoudi, a Saudi Arabia-based oil-and-construction billionaire who was born in Ethiopia and maintains a close relationship with the Ethiopian Prime Minister Meles Zenawi’s autocratic regime. (Fear of both men led my guide to say he didn’t want to be identified by name.) Over time, Al Amoudi, one of the world’s 50 richest people, according to Forbes, has used his fortune and political ties to amass control over large portions of Ethiopia’s private sector, including mines, hotels and plantations on which he grows tea, coffee, rubber and japtropha, a plant that has enormous promise as a biofuel. Since the global price spike, he has been getting into the newly lucrative world food trade.

Ethiopia might seem an unlikely hotbed of agricultural investment. To most of the world, the country is defined by images of famine: about a million people died there during the drought of the mid-1980s, and today about four times that many depend on emergency food aid. But according to the World Bank, as much as three-quarters of Ethiopia’s arable land is not under cultivation, and agronomists say that with substantial capital expenditure, much of it could become bountiful. Since the world food crisis, Zenawi, a former Marxist rebel who has turned into a champion of private capital, has publicly said he is “very eager” to attract foreign farm investors by offering them what the government describes as “virgin land.” An Ethiopian agriculture ministry official recently told Reuters that he has identified more than seven million acres. The government plans to lease half of it before the next harvest, at the dirt-cheap annual rate of around 50 cents per acre. “We are associated with hunger, although we have enormous investment opportunities,” explained Abi Woldemeskel, director general of the Ethiopian Investment Agency. “So that negative perception has to be changed through promotion.”

The government’s pliant attitude, along with Ethiopia’s convenient location, has made it an ideal target for Middle Eastern investors like Mohammed Al Amoudi. Not long ago, a newly formed Al Amoudi company, Saudi Star Agricultural Development, announced its plans to obtain the rights to more than a million acres — a land mass the size of Delaware — in the apparent hope of capitalizing on the Saudi government’s initiative to subsidize overseas staple-crop production. At a pilot site in the west of the country, he’s already cultivating rice. Earlier this year, amid great fanfare marking the start of the program, Al Amoudi personally presented the first shipment from the farm to King Abdullah in Riyadh. Meanwhile, in the Rift Valley region, another subsidiary is starting to grow fruits and vegetables for export to the Persian Gulf.

Al Amoudi’s plans raise a recurring question surrounding investment in food production: who will reap the benefits? As we drove down to the waterside, through fields dotted with massive sycamores, a farm supervisor told me that the 2,000-acre enterprise currently produces food for the local market, but there were plans to irrigate with water from the lake, and to shift the focus to exports. In the distance, dozens of laborers were bent to the ground, planting corn and onions.

Later, when I asked a couple of workers how much they were paid, they said nine birr each day, or around 75 cents. It wasn’t much, but Al Amoudi’s defenders say that’s the going rate for farm labor in Ethiopia. They argue that his investments are creating jobs, improving the productivity of dormant land and bringing economic development to rural communities. “We have achieved what the government hasn’t done for how many years,” says Arega Worku, an Ethiopian who is an agriculture adviser to Al Amoudi. (Al Amoudi declined to be interviewed.) Ethiopian journalists and opposition figures, however, have questioned the economic benefits of the deals, as well as Al Amoudi’s cozy relationship with the ruling party.

By far the most powerful opposition, however, surrounds the issue of land rights — a problem of historic proportions in Ethiopia. Just down the road from the farm on Lake Ziway, I caught sight of a gray-bearded man wearing a weathered pinstripe blazer, who was crouched over a ditch, washing his shoes. I stopped to ask him about the fence, and before long, a large group of villagers gathered around to tell me a resentful story. Decades ago, they said, during the rule of a Communist dictatorship in Ethiopia, the land was confiscated from them. After that dictatorship was overthrown, Al Amoudi took over the farm in a government privatization deal, over the futile objections of the displaced locals. The billionaire might consider the land his, but the villagers had long memories, and they angrily maintained that they were its rightful owners.

Throughout Africa, the politics of land is linked to the grim reality of hunger. Famines, typically produced by some combination of weather, pestilence and bad governance, break out with merciless randomness, unleashing calamity and reshaping history. Every country has its unique dynamics. Unlike most African nations, Ethiopia was never colonized in the 19th century but instead was ruled by emperors, who granted feudal plantations to members of their royal courts. The last emperor, Haile Selassie, was brought down by a famine that fueled a popular uprising. His dispossessed subjects chanted the slogan “land to the tiller.” The succeeding Communist dictatorship, which took ownership of all land for itself and pursued a disastrous collectivization policy, was toppled in the aftermath of the droughts of the 1980s. Under the present regime, private ownership of land is still banned, and every farmer in Ethiopia, foreign and domestic, works his fields under a licensing arrangement with the government. This land-tenure policy has made it possible for a one-party state to hand over huge tracts to investors at nominal rents, in secrecy, without the bother of a condemnation process.

Ethiopia’s government denies that anyone is being displaced, saying that the land is unused — an assertion many experts doubt. “One thing that is very clear, that seems to have escaped the attention of most investors, is that this is not simply empty land,” says Michael Taylor, a policy specialist at the International Land Coalition. If land in Africa hasn’t been planted, he says, it’s probably for a reason. Maybe it’s used to graze livestock, or deliberately left fallow to prevent nutrient depletion and erosion.

There is an ongoing debate among experts about the extent of the global land-acquisition trend. By its nature the evidence is piecemeal and anecdotal, and many highly publicized investments have yet to actually materialize on the ground. The most serious attempt to quantify the land rush, spearheaded by the International Institute for Environment and Development, suggests that as of earlier this year, the Ethiopian government had approved deals totaling around 1.5 million acres, while the country’s investment agency reports that it has approved 815 foreign-financed agricultural projects since 2007, nearly doubling the number registered in the entire previous decade. But that’s far from a complete picture. While the details of a few arrangements have leaked out, like one Saudi consortium’s plans to spend $100 million to grow wheat, barley and rice, many others remain undisclosed, and Addis Ababa has been awash in rumors of Arab moneymen who supposedly rent planes, pick out fertile tracts and cut deals.

Of course, there have been scrambles for African land before. In the view of critics, the colonial legacy is what makes the large land deals so outrageous, and they warn of potentially calamitous consequences. “Wars have been fought over this,” says Devlin Kuyek, a researcher with Grain, an advocacy group that opposes large-scale agribusiness and has played a key role in bringing attention to what it calls the “global land grab.”

It wasn’t until Grain compiled a long list of such deals into a polemical report titled “Seized!” last October that experts really began to talk about a serious trend. Although deals were being brokered in disparate locales like Australia, Kazakhstan, Ukraine and Vietnam, the most controversial field of investment was clearly Africa. “When you started to get some hints about what was happening in these deals,” Kuyek says, “it was shocking.” Within a month, Grain’s warnings seemed to be vindicated when The Financial Times broke news that the South Korean conglomerate Daewoo Logistics had signed an agreement to take over about half of Madagascar’s arable land, paying nothing, with the intention of growing corn and palm oil for export. Popular protests broke out, helping to mobilize opposition to Madagascar’s already unpopular president, who was overthrown in a coup in March.

The episode illustrated the emotional volatility of the land issue and raised questions about the degree to which corrupt leaders might be profiting off the deals. Since then, there has been an international outcry. Legislators from the Philippines have called for an investigation into their government’s agreements with various investing nations, while Thailand’s leader has vowed to chase off any foreign land buyers.

But there’s more than one side to the argument. Development economists and African governments say that if a country like Ethiopia is ever going to feed itself, let alone wean itself from foreign aid, which totaled $2.4 billion in 2007, it will have to find some way of increasing the productivity of its agriculture. “We’ve been complaining for decades about the lack of investment in African agriculture,” says David Hallam, a trade expert at the Food and Agriculture Organization. Last fall, Paul Collier of Oxford University, an influential voice on issues of world poverty, published a provocative article in Foreign Affairs in which he argued that a “middle- and upper-class love affair with peasant agriculture” has clouded the African development debate with “romanticism.” Approvingly citing the example of Brazil — where masses of indigenous landholders were displaced in favor of large-scale farms — Collier concluded that “to ignore commercial agriculture as a force for rural development and enhanced food supply is surely ideological.”

In Ethiopia, Mohammed Al Amoudi and other foreign agricultural investors are putting Collier’s theory into practice. Near the southern town of Awassa, in a shadow of a soaring Rift Valley escarpment, sits a field of waving corn and a complex of domed greenhouses, looking pristine and alien against the natural backdrop. On an overcast July morning, dozens of laborers were at work preparing the ground for one of Al Amoudi’s latest enterprises: a commercial vegetable farm.

“For a grower, this is heaven on earth,” says Jan Prins, managing director of the subsidiary company that is running the venture for Al Amoudi. Originally from the Netherlands, Prins says he assumed that Ethiopia was arid but was surprised to learn when he came to the country that much of it was fertile, with diverse microclimates. The Awassa farm is one of four that Prins is getting up and running. Using computerized irrigation systems, the farms will grow tomatoes, peppers, broccoli, melons and other fresh produce, the vast majority of it to be shipped to Saudi Arabia and Dubai. Over time, he says, he hopes to expand into growing other crops, like wheat and barley, the latter of which can be used to feed camels.

The nations of the Persian Gulf are likely to see their populations increase by half by 2030, and already import 60 percent of their food. Self-sufficiency isn’t a viable option, as the Saudis have learned through bitter experience. In the 1970s, worries about the stability of the global food supply inspired the Saudi government to grow wheat through intensive irrigation. Between 1980 and 1999, according to a study by Elie Elhadj, a banker and historian, the Saudis pumped 300 billion cubic meters of water into their desert. By the early 1990s, the kingdom had managed to become the world’s sixth-largest wheat exporter. But then its leaders started paying attention to the warnings of environmentalists, who pointed out that irrigation was draining a nonreplenishable supply of underground freshwater. Saudi Arabia now plans to phase out wheat production by 2016, which is one reason it’s looking to other countries to fill its food needs.

“The rules of the game have changed,” says Saad Al Swatt, the chief executive of the Tabuk Agricultural Development Company, one of the kingdom’s largest farming concerns. Al Swatt’s company was one of those that met with Robert Zeigler about farming rice; he says that with government encouragement, he is looking at expanding into countries like Sudan, Ethiopia and Vietnam. “They have the land, they have the water, but unfortunately, they don’t have the system or sometimes the finance to have these large-scale agricultural projects.” Al Swatt says. “We wanted to export our experience and really develop those areas, to help people.”

About 10 percent of the more than 80 million people who live in Ethiopia suffer from chronic food shortages. This year, because of poor rains, the U.N. World Food Program warns that much of East Africa faces the threat of a famine, potentially the worst in almost two decades. Traditionally, the model for feeding the hungry in Africa has involved shipping in surpluses from the rest of the world in times of emergency, but governments that are trying to attract investment say that the new farms could provide a lasting, noncharitable solution. (“It’s better than begging,” one Ethiopian official recently told the African publication Business Daily.) Whatever the long-term justification, however, it looks bad politically for countries like Kenya and Ethiopia to be letting foreign investors use their land at a time when their people face the specter of mass starvation. And many experts wonder whether such governments will go through with the deals. Ethiopia, after all, was one of the countries that banned grain exports during the recent spike in world food prices. “The idea that one country would go to another country,” says Robert Zeigler, “and lease some land, and expect that the rice produced there would be made available to them if there’s a food crisis in that host country, is ludicrous.”

The hyperinflationary spiral that caused the world food crisis had multiple causes. The harvests in 2006 and 2007 were the worst of the decade, hedge funds and other players in the commodities markets appear to have driven up prices and government subsidies for biofuels encouraged farmers to grow crops that ended up as ethanol. But the environment and demography are more lasting issues, and experts predict that prices, which have declined since their peak, are likely to stabilize significantly above precrisis levels. This represents a danger to the developing world, where the poor spend between 50 and 80 percent of their income on food, but it may also present an opportunity. If one good thing has emerged from the crisis, it’s a growing awareness of Africa’s unrealized agricultural potential. Because where there are appetites, there are profits to be made.

In late June, several hundred farmers and investment bankers came together in Manhattan to survey the landscape at a conference on global agriculture investment. The food crisis has served as a catalyst for the sleepy agricultural sector, spurring financial firms like Goldman Sachs and BlackRock to invest hundreds of millions of dollars in overseas agricultural projects, so the mood was heady for business, though depressing for humanity. There much talk of Thomas Malthus, the 19th-century prophet of overpopulation and famine.

“Beware of 2020 and beyond, because we think there could be genuine food shortages by that period,” Susan Payne, the chief executive of Emergent Asset Management, told the audience during a talk on Africa’s agricultural potential. She showed a series of slides citing chilling statistics: grain stocks are at their lowest levels in 60 years; there were food riots in 15 countries in 2008; global warming is turning arable land into desert; freshwater is dwindling and China is draining its reserves; and the really big problem that contributes to all the others — the world’s population is growing by 80 million hungry people a year. The United Nations Food and Agriculture Organization estimates that in order to feed the world’s projected population in 2050 — some nine billion people — agricultural production needs to increase by an annual average of 1 percent. That means adding around 23 million tons of cereals to the world’s food supply next year, a little less than the total production of Australia in 2008.

“Africa is the final frontier,” Payne told me after the conference. “It’s the one continent that remains relatively unexploited.” Emergent’s African Agricultural Land Fund, started last year, is investing several hundred million dollars into commercial farms around the continent. Africa may be known for decrepit infrastructure and corrupt governments — problems that are being steadily alleviated, Payne argues — but land and labor come so cheaply there that she calculates the risks are worthwhile.

The payoffs could be immense. In a country like Ethiopia, farmers put in backbreaking effort, but they yield about a third as much wheat per acre as do Europe, China or Chile. Even modest interventions could start to close this gap. One small example: the black soil I saw throughout the Great Rift region. Known as vertisol, it’s a product of volcanic activity and possesses the nutrients to produce enormous harvests. Because of its high clay content, however, it becomes sticky and waterlogged during the rainy season, which makes it very difficult to plow by traditional methods. With the addition of advanced implements, improved seeds and fertilizer, you can double the amount of wheat it yields. Ethiopia, like all of Africa, is full of such opportunities, which is one reason the World Bank says that investing in agriculture is one of the most effective ways to speed economic development on the continent.

Yet agriculture has historically been a tiny item in foreign-aid budgets. For years, governments, private foundations and donor institutions like the World Bank have been urging African governments to fill the spending gap with private investment. Now, at the very moment a world food crisis has come along, creating the perhaps fleeting possibility of an influx of capital into African agriculture, some of the same organizations are sending conflicting messages. The Food and Agriculture Organization, for instance, co-sponsored a report calling for a major expansion of commercial agriculture in Africa, but the organization’s director-general has simultaneously been warning of the “neocolonial” dangers of land deals. “We’re making them feel that it’s sinful,” says Mafa Chipeta, a Malawian who oversees Ethiopia and the rest of eastern Africa for the organization. “Why are we not saying, here is an opportunity?”

One focus of agricultural investment in Ethiopia is the region of Gambella, near the border with Sudan. The World Bank says it has more than four million acres of irrigable land. “It’s emerald green, the whole place is fertile and they have only 200,000 people down there,” says Sai Ramakrishna Karuturi, head of an Indian commercial farming company. Earlier this year, Karuturi signed an agreement with the government to lease close to 800,000 acres on which he will grow rice, wheat and sugar cane, among other crops. Karuturi told me he doesn’t have to export the food to make money; there’s plenty of profit potential in the East African market. He has flown in John Deere tractors, agricultural experts from Texas A&M and commercial farmers from Mississippi to help him get things going. He says he’s raising $100 million in capital from private equity firms for the first phase of the project, which he estimates will ultimately cost well over a billion dollars. “Recently, I saw a lot of articles . . . where they referred to me as a food pirate,” Karuturi says. “This whole thing is so elitist, it’s ridiculous. They want Africa to remain poor.”

But the argument against enormous land concessions needn’t be based solely on appeals to human rights, environmental warnings or romanticism. It’s possible to be a believer in development without endorsing Paul Collier’s view that the small landholders stand in its way. In fact, there’s a whole school of economic thought that says that Collier is wrong, that big is not necessarily better in agriculture — and that the land deals therefore might be unwise not because they’re wrong but because they’re unprofitable. A recent World Bank study found that large-scale export agriculture in Africa has succeeded only with plantation crops like sugar and tea or in ventures that were propped up by extreme government subsidies, during colonialism or during the apartheid era in South Africa.

This record of failure is one reason that the government of Qatar, in addressing its food-security concerns, has chosen to concentrate on investing in existing agribusinesses rather than just acquiring land. That’s just one of many ways to invest in farming without removing the African farmers. On a bright Rift Valley afternoon, I went to see another option, a cooperative scheme under which a group of around 300 Ethiopians, working plots of 4 to 10 acres, were getting into export agriculture. During the European winter, they grew green beans for the Dutch market. The rest of the year, they cultivated corn and other crops for local consumption. The land had been irrigated with the help of a nonprofit organization and an Ethiopian commercial farmer named Tsegaye Abebe, who brought all the produce to market.

As a breeze riffled through a tall field of corn, a group of farmers, wearing sandals made from old tires, told me the arrangement, while not perfect, was beneficial in the most crucial respect: they weren’t toiling for someone else. Not far away, a Pakistani investor had taken over a government cattle ranch, once an area free for grazing, and had put fences and trenches in place to keep out the local livestock. The Ethiopians who worked there were miserable.

The farmers had heard rumors that foreign investors were eyeing still more Ethiopian land. Imam Gemedo Tilago, a 78-year-old cloaked in a white cotton shawl, shook his finger, vowing that Allah would not allow the community to remain passive. But that was a problem for the future, and the farmers had more grounded concerns. I noticed, driving down the rural paths that led to this farm, that the earth looked parched in places, and the cattle were showing their ribs through their dull brown hides. The worried farmers told me that this year, the seasonal rains were late in coming to the Rift Valley. If they didn’t arrive soon, there’d be hunger.

(The above article is written by Andrew Rice, a contributing writer and the author of “The Teeth May Smile But the Heart Does Not Forget,” about a Ugandan murder trial.)

3 Responses to “Ethiopian ‘virgin land’ for sale”

1. Addisu A. says:

Such a nice article! It is amazing the extent to which the author paid attention to the small details. And it is evident that he tried to make a fair and justified argument. Unfortunately, he failed to arrive at any clear conclusion even though he was the most informed one to do so. Thus, I take it upon myself to make such a conclusion.

Let me start with my conclusion. Despite its claimed disadvantages, commercial farming will contribute positively to the future of poor countries like Ethiopia, even if (some of) it might be done by foreign investors.

The first obvious demerit of commercial agriculture is environmental loss. With the start of commercial farms like Karuturi’s and Al Amoudi’s in Gambella, for example, Ethiopia will lose its only remaining natural forests. But it is obvious that doing nothing would not save the forests either. Much of central and northern Ethiopia, which used to be densely forested a few decades ago, is completely barren now because of the increasing population pressure. There is no question that poverty is the worst enemy of the environment. If it could improve productivity and create jobs, commercial farming will perhaps improve even the fate of the environment. For that matter all countries that are rich today at some point exploited their natural resources intensively before succeeding to replenish them eventually.

Another disadvantage of commercial farming is loss of independent livelihood for some farmers. When their grazing land is taken over by commercial farms or when they cannot freely farm any open land they find anymore, some farmers will eventually be forced to be laborers to commercial investors. But then again, what would be the other alternative? Collectivization is evidently more efficient (especially if you want to export), but household-led farming, in spite of all its disputed efficiency, has failed to lead to any meaningful economic change. Taking the example of Ethiopia again, almost all Ethiopian farmers till the land the way their ancestors did thousands of years ago. Given the current population growth, the future of this country in terms of food availability is definitely bleak without an increase in agricultural productivity. Loss of individual livelihood can thus be considered a little price to pay for the greater good of making sure that there is enough food supply. It should not be forgotten that, almost always, early years of economic transformation are very painful. Many people today don’t remember the widespread dissatisfaction and mass revolt that persisted throughout Europe when the continent was in rapid changes in the early 20th century. This eventually led to the emergence of communist governments in some countries and strongly welfare-oriented governance in others. My point is that change will unavoidably create discontent and inequality which should not be shunned but managed accordingly.

The third and perhaps the toughest challenge for countries like Ethiopia to give away land for foreign investment is the future population pressure. It is very easy to foresee that, given the current population explosion, food demand would skyrocket in 20 or 30 years. Population control is of very urgent need in much of Africa, but that is a different story. Even so, commercializing agriculture remains the only viable option to satisfy the increasing food demand. By increasing domestic production, commercialization can avert the import of food aid outside the country. By increasing productivity, it also enables to feeding more people with the existing resources. Obviously, the fact that most owners of the commercial farms are foreigners adds more complexity to this. But it should be noted that the coming of foreign commercial farms initiates the domestic industry too (see the floriculture industry in Ethiopia as an example). It can be argued that in the long run at least half of the commercial farms will be domestic. On the other hand, even the export-oriented foreign farms will be beneficial to the country because they generate hard-sought foreign currency. If we don’t become too preoccupied in the issue of food, future population growth will also create huge demand for imported commodities such as oil and other consumer products. Without developing their domestic production capacity by exploiting their resources of comparative advantage, countries like Ethiopia will not be able to generate the foreign currency they will need to satisfy their large future demand for imports.

November 21st, 2009 at 11:32 AM

2. DUBE KESEMAY says:

Sell the rest of Ethiopia and invest in Tigre-land. For sure the money is going to develop Tigre-land. So far 2 universities, many factories, an expensive Hydro power plant, of which the cost would have built 2 in other places, roads, irrigation technology…etc…

Ye-Ethiopia Hizb…”Be-meret ena Be-mist yemeTa…” yemibalewen ababal resahew ende?

Do we really want to serve the Arabs and the Indians?

November 23rd, 2009 at 11:59 AM

3. Florad says:

DUBE KESEMAY, you have got a funny name. For the rest, you did not read the article at all. So you just said what you have been saying all the time.

November 29th, 2009 at 8:37 AM

See also: Coffee production in Ethiopia

The most important cash crop in Ethiopia was coffee. During the 1970s, coffee exports accounted for 50-60% of the total value of all exports, although coffee's share dropped to 25% as a result of the economic dislocation following the 1974 revolution. By 1976 coffee exports had recovered, and in the five years ending in 1988/89, 44% of the coffee grown was exported, accounting for about 63% of the value of exports. Domestically, coffee contributed about 20% of the government's revenue. Approximately 25% of Ethiopia's population depended directly or indirectly on coffee for its livelihood.[4]

Ethiopia's coffee is almost exclusively of the arabica type, which grows best at altitudes between 1,000 and 2,000 meters. Coffee grows wild in many parts of the country, although most Ethiopian coffee is produced in the Oromia Region (63.7%) and in the SNNPR (34.4%), with lesser amounts in the Gambela Region and around the city of Dire Dawa. The amount of coffee inspected in the fiscal year 2007/2008 by the Ethiopian Coffee and Tea Authority (ECTA) was 230,247 tons, a decrease of almost 3% from the previous fiscal year's total of 236,714 tons.[9]

About 98 percent of the coffee was produced by peasants on smallholdings of less than a hectare, and the remaining 2 percent was produced by state farms. Some estimates indicated that yields on peasant farms were higher than those on state farms. In the 1980s, as part of an effort to increase production and to improve the cultivation and harvesting of coffee, the government created the Ministry of Coffee and Tea Development (now the ECTA), which was responsible for production and marketing. The ten-year plan called for an increase in the size of state farms producing coffee from 14,000-15,000 hectares to 50,000 hectares by 1994. However, beginning in 1987 the decline in world coffee prices, reduced Ethiopia's foreign-exchange earnings. In early 1989, for example, the price of one kilogram/US$0.58; of coffee was by June it had dropped to US$0.32. Mengistu told the 1989 WPE party congress that at US$0.32 per kilogram, foreign-exchange earnings from coffee would have dropped by 240 million Birr, and government revenue would have been reduced by 140 million Birr by the end of 1989.[4]

Before the Ethiopian Revolution, pulses and oilseeds played an important role, second only to coffee, in the country's exports. In EFY 1974/75, pulses and oilseeds accounted for 34% of export earnings (about 163 million Birr), but this share declined to about 3% (about 30 million Birr) in EFY 1988/89. Three factors contributed to the decline in the relative importance of pulses and oilseeds. First, the recurring droughts had devastated the country's main areas where pulses and oilseeds were grown. Second, because peasants faced food shortages, they gave priority to cereal staples to sustain themselves. Finally, although the production cost of pulses and oilseeds continued to rise, the government's price control policy left virtually unchanged the official procurement price of these crops, thus substantially reducing net income from them.[4] In EFY 2007/2008, the CSA reported that 17,827,387.94 quintals of pulses were produced on 1,517,661.93 hectares, an increase from the 15,786,215.3 quintals produced on 1,379,045.77 hectares. In the same fiscal year, 707,059.29 hectares under cultivation produced 6,169,279.99 quintals of oilseeds, an increase from the previous year of 4,970,839.57 quintals grown on 741,790.98 hectares.[10] In 2006/2007 (the latest year available), exports of oilseeds accounted for 15.78% of export earnings (or million 187.4 Birr) and pulses 5.92% (or 70.3 million Birr).[11]

Ethiopia's flower industry has become a new source for export revenue. The industry began in 2004, when the government made an aggressive push for foreign investments by establishing a presence at major international floricultural events. Since then, export earnings from this sector have grown to about US$65 million in 2006/07 and are projected to double over the next few years. Ethiopia is well positioned because highland temperatures make it ideal for horticulture, the average wage rate is US$20 per month (compared to US$60 a month in India), the price of leased land is about US$13 per hectare, and the government has tremendously aided the entry of new businesses into this sector in recent years. As a result, a number of Indian entrepreneurs are relocating to Ethiopia to develop its thriving flower industry which has led to gains in market share at the expense of neighboring countries.[12]

Another new source for export revenue is the production of khat, an amphetamine-like stimulant which is consumed both inside Ethiopia and in adjacent countries, and which is considered a drug of abuse that can lead to mild to moderate psychological dependence. In 2006/2007 (the latest year available), exports of khat accounted for 7.8% of export earnings (or 92.8 million Birr).[11]

Cotton is grown throughout Ethiopia below elevations of about 1,400 meters. Because most of the lowlands lack adequate rainfall, cotton cultivation depends largely on irrigation. Before the revolution, large-scale commercial cotton plantations were developed in the Awash Valley and the Humera areas. The Tendaho Cotton Plantation in the lower Awash Valley was one of Ethiopia's largest cotton plantations. Rain-fed cotton also grew in Humera, Bilate, and Arba Minch. Since the revolution, most commercial cotton has been grown on irrigated state farms, mostly in the Awash Valley area. Production jumped from 43,500 tons in 1974/75 to 74,900 tons in 1984/85. Similarly, the area of cultivation increased from 22,600 hectares in 1974/75 to 33,900 hectares in 1984/85.[4]

[edit] Major staple crops

Ethiopia's major staple crops include a variety of cereals, pulses, oilseeds, and coffee. Grains are the most important field crops and the chief element in the diet of most Ethiopians. The principal grains are teff, wheat, barley, corn, sorghum, and millet. The first three are primarily cool-weather crops cultivated at altitudes generally above 1,500 meters. Teff, indigenous to Ethiopia, furnishes the flour for enjera, an unleavened bread that is the principal form in which grain is consumed in the highlands and in urban centers throughout the country. Barley is grown mostly between 2,000 and 3,500 meters. A major subsistence crop, barley is used as food and in the production of tella, a locally produced beer.[4]

Sorghum, millet, and corn are cultivated mostly in warmer areas at lower altitudes along the country's western, southwestern, and eastern peripheries. Sorghum and millet, which are drought resistant, grow well at low elevations where rainfall is less reliable. Corn is grown chiefly between elevations of 1,500 and 2,200 meters and requires large amounts of rainfall to ensure good harvests. These three grains constitute the staple foods of a good part of the population and are major items in the diet of the nomads.[4]

Pulses are the second most important element in the national diet and a principal protein source. They are boiled, roasted, or included in a stew-like dish known as wot, which is sometimes a main dish and sometimes a supplementary food. Pulses, grown widely at all altitudes from sea level to about 3,000 meters, are more prevalent in the northern and central highlands. Pulses were a particularly important export item before the revolution.[4]

The Ethiopian Orthodox Church traditionally has forbidden consumption of animal fats on many days of the year. As a result, vegetable oils are widely used, and oilseed cultivation is an important agricultural activity. The most important oilseed is the indigenous Niger seed (neug), which is grown on 50 percent or more of the area devoted to oilseeds. Niger seed is found mostly in the northern and central highlands at elevations between 1,800 and 2,500 meters. Flaxseed, also indigenous, is cultivated in the same general area as Niger seed. The third most important oilseed is sesame, which grows at elevations from sea level to about 1,500 meters. In addition to its domestic use, sesame is also the principal export oilseed. Oilseeds of lesser significance include castor beans, rapeseed, peanuts, and safflower and sunflower seeds. Most oilseeds are raised by small-scale farmers, but sesame was also grown by large-scale commercial farms before the era of land reform and the nationalization of agribusiness.[4]

Ensete, known locally as false banana, is an important food source in Ethiopia's southern and southwestern highlands. It is cultivated principally by the Gurage, Sidama, and several other ethnic groups in the region. Resembling the banana but bearing an inedible fruit, the plant produces large quantities of starch in its underground rhizome and an above-ground stem that can reach a height of several meters. Ensete flour constitutes the staple food of the local people. Taro, yams, and sweet potatoes are commonly grown in the same region as the ensete.[4]

The consumption of vegetables and fruits is relatively limited, largely because of their high cost. Common vegetables include onions, peppers, squash, and a cabbage similar to kale. Demand for vegetables has stimulated truck farming around the main urban areas such as Addis Ababa and Asmera. Prior to the Revolution, urbanization increased the demand for fruit, leading to the establishment of citrus orchards in areas with access to irrigation in Shewa, Arsi, Hararghe, and Eritrea. The Mengistu regime encouraged fruit and vegetable production. Fresh fruits, including citrus and bananas, as well as fresh and frozen vegetables, became important export items, but their profitability was marginal. The Ethiopian Fruit and Vegetable Marketing Enterprise, which handled about 75 percent of Ethiopia's exports of fruits and vegetables in 1984-85, had to receive government subsidies because of losses.[4]

Ethiopia's demand for grain continued to increase because of population pressures, while supply remained short, largely because of drought and government agricultural policies, such as price controls, which adversely affected crop production. Food production had consistently declined throughout the 1980s. Consequently, Ethiopia became a net importer of grain worth about 243 million Birr annually from 1983/84 to 1987/88. The food deficit estimate for the 1985/89 period indicated that production averaged about 6 million tons while demand reached about 10 million tons, thus creating an annual deficit of roughly 4 million tons. Much of the food deficit was covered through food aid. Between 1984/85 and 1986/87, at the height of the drought, Ethiopia received more than 1.7 million tons of grain, about 14 percent of the total food aid for Africa. In addition, Ethiopia spent 341 million Birr on food purchases during the 1985-87 period.[4]

[edit] Livestock

Livestock production plays an important role in Ethiopia's economy. Estimates for 1987 indicated that livestock production contributed one-third of agriculture's share of GDP, or nearly 15 percent of total GDP. In the 2006/2007 EFY hides, skins and leather products made up 7.5% of the total export value; live animals accounted for 3.1% of the total value of exports during the same period.[11]

Although varying from region to region, the role of livestock in the Ethiopian economy was greater than the figures suggest. Almost the entire rural population was involved in some way with animal husbandry, whose role included the provision of draft power, food, cash, transportation, fuel, and, especially in pastoral areas, social prestige. In the highlands, oxen provided draft power in crop production. In pastoral areas, livestock formed the basis of the economy. Per capita meat consumption was high by developing countries' standards, an estimated thirteen kilograms annually. According to a 1987 estimate, beef accounted for about 51% of all meat consumption, followed by mutton and lamb (19%), poultry (15%), and goat (14%).[4]

Ethiopia's estimated livestock population is often said to be the largest in Africa.[13] It is estimated to number over 150 million in 2007/2008. Excluding the Afar and Somali Regions, there were approximately 47.5 million cattle, 26.1 million sheep, 21.7 million goats, 2.1 million horses and mules, 5.6 million donkeys, 1 million camels, and 39.6 million poultry. For the later two Regions, estimated numbers vary greatly between conventional and aerial censuses, but total less than 15% of the non-nomadic Regions. Though the raising of livestock always has been largely a subsistence activity,[14] intensive, factory farm facilities are gaining in popularity and are present in Addis Ababa and Debre Zeit, run by Ethiopian agribusiness ELFORA. [15]

Ethiopia has great potential for increased livestock production, both for local use and for export. However, expansion was constrained by inadequate nutrition, disease, a lack of support services such as extension services, insufficient data with which to plan improved services, and inadequate information on how to improve animal breeding, marketing, and processing. The high concentration of animals in the highlands, together with the fact that cattle are often kept for status, reduces the economic potential of Ethiopian livestock.[4]

While efforts are being made to intensify and industrialize the sector, questions arise as to how Ethiopia can develop and expand its livestock population when Ethiopians already struggle to gain access to good soil, grazing land, and water. [16] As Ethiopia increasingly experiences the effects of climate change, drought, and desertification, experts predict that "Ethiopia will have to open its markets to grain imports in order to keep up with the growing demand for meat, milk, and eggs."[17].

Both the imperial and the Marxist governments tried to improve livestock production by instituting programs such as free vaccination, well-digging, construction of feeder roads, and improvement of pastureland, largely through international organizations such as the World Bank and the African Development Bank. During Derg rule, veterinary stations were opened at Bahir Dar, Bedele, and Debre Zeyit to provide treatment and vaccination services.[4]

Cattle in Ethiopia are almost entirely of the zebu type and are poor sources of milk and meat. However, these cattle do relatively well under the traditional production system. About 70 percent of the cattle in 1987 were in the highlands, and the remaining 30 percent were kept by nomadic pastoralists in the lowland areas. Meat and milk yields are low and losses high, especially among calves and young stock. Contagious diseases and parasitic infections are major causes of death, factors that are exacerbated by malnutrition and starvation. Recurring drought takes a heavy toll on the animal population, although it is difficult to determine the extent of losses. Practically all animals are range-fed. During the rainy seasons, water and grass are generally plentiful, but with the onset of the dry season, forage is generally insufficient to keep animals nourished and able to resist disease.[18]

Most of Ethiopia's estimated 48 million sheep and goats are raised by small farmers who used them as a major source of meat and cash income. About three-quarters of the total sheep flock is in the highlands, whereas lowland pastoralists maintain about three-quarters of the goat herd. Both animals have high sales value in urban centers, particularly during holidays such as Easter and New Year's Day.[18]

Most of the estimated 7.5 million equines (horses, mules, and donkeys) are used to transport produce and other agricultural goods. Camels also play a key role as pack animals in areas below 1,500 meters in elevation. Additionally, camels provide pastoralists in those areas with milk and meat.[18]

Poultry farming is widely practiced in Ethiopia; almost every farmstead keeps some poultry for consumption and for cash sale. The highest concentration of poultry is in Shewa, in central Wollo, and in northwestern Tigray. Individual poultry farms supply eggs and meat to urban dwellers. By 1990 the state had begun to develop large poultry farms, mostly around Addis Ababa, to supply hotels and government institutions.[4] Multinational agribusinesses supply these industrial poultry farms with high yielding breeds, such as Rhode Island Reds and White Leghorns. [19]

[edit] Government marketing operations

Private traders and the Agricultural Marketing Corporation (AMC), established in 1976, marketed Ethiopia's agricultural output. The AMC was a government agency whose objective was to influence the supply and price of crops. It purchased grain from peasant associations at fixed prices. The AMC set quotas of grain purchases to be delivered by peasant associations and cooperatives and also bought from private wholesalers, who were required to sell half of their purchases at predetermined prices. State farms sold their output to the AMC. Although the AMC had agents in all regions, it was particularly active in the major cereal producing regions, namely, Gojjam, Shewa, Arsi, and Gondar. In 1981/82, out of the AMC's purchases of 257,000 tons of grain, Gojjam accounted for 32 percent of the purchases, and Arsi, Shewa, and Gonder accounted for 23%, 22%, and 10%, respectively. The government's price controls and the AMC's operations had led to the development of different price systems at various levels. For instance, the 1984/85 official procurement price for 100 kilograms of teff was 42 birr at the farm level and 60 birr when the AMC purchased it from wholesalers. But the same quantity of teff retailed at 81 birr at food stores belonging to the urban dwellers' associations (kebeles) in Addis Ababa and sold for as much as 181 birr in the open market. Such wide price variations created food shortages because farmers as well as private merchants withheld crops to sell on the black market at higher prices.[4]2/9/2011

WikiLeaks releases Unclassified document about Land grab in Ethiopia

SUBJECT: FOREIGN INVESTORS GRAB UP MORE LAND IN ETHIOPIA

WikiLeaks

REF: 09 ADDIS ABABA 2900

ADDIS ABAB 00000247 001.2 OF 002

SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET DISTRIBUTION.

¶1. (SBU) SUMMARY: The Government of Ethiopia's (GoE) recent high

profile land deals and shift in agricultural policy (reftel) have

attracted additional foreign investors to the agricultural and

tourism sectors. In January, Egyptian Prime Minster Dr. Ahmed Nazif

led a large delegation to Ethiopia to announce the National Bank of

Egypt's lease of 49,400 acres of land to grow cereals. Press

reports indicated that these cereals are headed for export to Egypt.

Former Nigerian President Olusegun Obasanjo and Djiboutian

President Ismael Omar Guelleh separately leased land plots to build

hotels outside of Addis Ababa, while Guelleh already leases a 7,400

acre farm that started exporting wheat back to Djibouti last year.

Finally, the South African private equity investment fund Agri-Vie

invested USD 3.5 million in a company that is growing and processing

various fruits to manufacture juice products. These juice products

will primarily target the European and the Middle Eastern markets as

reported by the company to Econoff. Despite the benefits of

increased foreign investment, political opposition members and

international critics remain skeptical about the GoE's motives and

the land policy's affect on poor, rural Ethiopians. End Summary.

Egyptians Eye Investment Opportunities

--------------------------------------

¶2. (U) The Egyptian Prime Minister, Dr. Ahmed Nazif, led the latest

charge of foreign agricultural investment during a January visit to

Ethiopia. Nazif, alongside his delegation of several cabinet

ministers and 26 agricultural companies, announced that the

state-owned National Bank of Egypt plans to invest USD 40 million in

the lease of 49,400 acres of land in the Afar region to grow

cereals. Press reports stated that these cereals would be exported

to Egypt despite the GoE's 2007 "temporary" export ban on all

cereals that has never been formally lifted. (Note: It appears

Saudi, Djiboutian, and now Egyptian investors have somehow bypassed this ban, while other investors informed Econoff that they have not been allowed to export cereal grains (reftel). End Note.) The bank is also poised to open an office in Ethiopia to serve existing and

new Egyptian projects and plans to offer credit of USD 14.6 million

to six Ethiopian banks according to local press reports. (Note: the

domestic banking sector is closed to foreign banks; however, other

foreign banks such as Germany's Commerzbank do have offices in

Ethiopia to facilitate relations with Ethiopian banks. It is

unclear how the National Bank of Egypt could offer credit in

Ethiopia in evident violation of banking and financial regulations.

End Note.) Beyond the focus on agriculture, Nazif signed a

memorandum of understanding with GoE Prime Minister Meles Zenawi to form an Ethio-Egypt Council of Commerce. Meles said during the

signing ceremony that relations between Ethiopia and Egypt had

evolved from distrust towards friendly cooperation. Other areas of

Egyptian business interest included livestock, drug manufacturing,

and hydroelectric power.

Former Nigerian President and Djiboutian President Also Invest

--------------------------------------------- ------

¶3. (U) Another foreign VIP seen around town and looking for land was

the former president of Nigeria, Olusegun Obasanjo. Obasanjo

recently leased about five acres of land near Debrezeit, Oromia

region (about 50 kilometers east of Addis Ababa) to develop a hotel

and tourist destination. In addition, current Djiboutian President

Ismael Omar Guelleh recently acquired the right to develop about 2.5

acres of lakeside land in Debrezeit to build a hotel. This

acquisition added to the 7,400 acres of farmland Guelleh leased last

year in Bale, Oromia region. According to post's conversations with

local agricultural business investors and press reports, this farm

has already harvested wheat and other cereals for export to

Djibouti.

Private Equity Fund Invests in Fruit Juice Farm

--------------------------------------------- --

ADDIS ABAB 00000247 002.2 OF 002

¶4. (U) South African private equity fund Agri-Vie has also chosen to

invest in Ethiopia's agricultural sector. The fund invested USD 3.5

million in africaJUICE, a company already in the process of

establishing fruit production and processing operations when Econoff

visited its 3,000 acre operation last year. The Dutch and British

company representatives reported to Econoff that it plans to target

the juice markets in Europe and the Middle East. The company

purchased this farm (not the land) from the GoE and converted it to

produce yellow passion fruit, mango, and papaya.

Critics Concerned About Rural Population

----------------------------------------

¶5. (U) As more reports of foreign land leases in Ethiopia surface,

the GoE continues to insist local farmers will not be adversely

affected by its land deals. Regarding agricultural investment, the

GoE views foreign investor involvement as key to the country's move

from subsistence to commercial farming (reftel). On top of any

potential damage to local farmers, international and political

opposition party critics cite concerns over exporting food from a

country that relies so heavily on imported food aid and the

perceived low wages that foreign investors pay its employees.

Merara Gudina, Chairman of the Ethiopian Federal Democratic Unity

Forum (a coalition of political opposition parties), accused the GoE

of using its land "giveaway" policy to hold on to power and to buy

diplomatic support. U.S.-based GoE opposition movement Ginbot 7

stated in a January editorial that the GoE needs to change its

communist land policy and empower local farmers, who have the

potential to produce a marketable surplus. The editorial further

noted that any land deal that has not been agreed to by the

Ethiopian people will not be honored by future elected governments.

Comment

-------

¶6. (SBU) The GoE clearly needed to shift its agricultural policy in

order to make effective use of its vast amounts of fertile land, and

the agricultural policy mix being implemented is viewed by most

experts as a step in the right direction. However, that evolving

policy is a long way from proving its worth as a vehicle for

achieving the GoE's stated goals of modernizing the sector,

generating foreign exchange reserves, and increasing the domestic

food supply. End Comment.

PermalinkPermalink74 comments »

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74 comments

Comment from: Dream On [Visitor]

To Eritreans

Those rich Eritreans by now would have their own fertile land in Ethiopia....You are refugees on a fertile land. Can you see what is happening under your eyes? You will never own it! We prefer to give it to the Chinese, Indians, Nigerians...You will never never never get it & own it!!

Eat your SAWA desert sand.

The GoE clearly needed to shift its agricultural policy in order to make effective use of its vast amounts of fertile land, and the agricultural policy mix being implemented is viewed by most experts as a step in the right direction.

============

I love it!!

The Disapora is now officialy dead and buried!!

01/30/11 @ 01:50

Comment from: alex [Visitor]

Hey where is the anger, where is the outrage? Ethiopians. I think the best peopel in Ethiopian have come and gone in the past generation. This generation is all about, Women or men, Chat mirkanna, alchohole and ego. 80 million of you are officially dead alive. The land belongs to you and your grand children have been sold by the etnic federalist crime minester Z..we. Where is the anger peopl? where is it? Look at the egyptians, Tunisians and Yemen. Please take the momentum and knock down your 20 years tiren.

01/30/11 @ 02:51

Comment from: Ali [Visitor]

*****

The current land policy under-way in Ethiopia signifies the regime's desperate attempt to cling on to power and avoid by a means necessary to empower the people of Ethiopia- in fear of the economic prosperity of the latter.

It is right time for all Ethiopian related website to create a forum where the Ethiopian Activist can steer the inevitable revolution under way in Ethiopia.

To facilitate this, I am requesting Nazereth.com and other website to immediately print any comment, suggestion, blog, or any other writing. For example, Nazereth.com takes 1-2 days to print a comment on its post column. It is understandable why this website do this. it is just to edit some offensive comment. However, this can be done after, it allows the writing to be appeared on the blog.

censorship before print is against all the spirit of the freedom of speech. any world major website make your comment appear in their blog immediately and disallow it if it contain offensive material

01/30/11 @ 03:00

Comment from: Ali [Visitor]

Let us steer the current political, economic and social transformation underway in Ethiopia. It is time to make sure that the course of the history does not take its own turn. We are under duty to shape and create our future.

Ethiopia is a country that composes of many nation/nationalities. In the past, the effort made to address these has met by revisionist interest to carry out their hidden agenda. A case in point is the Derge Regime that hijacked the popular uprising of Studnet in the 70s and the people struggle in the 80s which was again used by the current regime to implement its divisiveness agenda of ethnic. I do have any objection if people are organised themselves by their ethnic origin. But it is totally unacceptable when the regime used this to carry out its hidden agenda of dividing the people to just fulfil it poor policies.

01/30/11 @ 03:10

Comment from: alex [Visitor]

Alex,

you smell like Eritrean. listen most ethiopians know that the opposition works with Eritrea. lets examine the opposition seriously. EPPF is in Eritrea, Ginbot 7 based in Eritrea, the Diaspora those that visited ethiopia see the opportunity they can have with their doller so they keep quiet about politics and invest, the poor in ethiopia are trying to make it and not worried about politics, this is reality i just came from Ethiopia, but there is a common thinking, which is everyone dis-trust Eritrea (shabia) and their people for not speaking about their own oppressor (Assayas Afuwora) and pretending that everything is ok. when asked about how eritrea is most eritreans say, eritrea is number one and we are better than you ethiopians, who are africans, we are most advance becuse we have been colonized, this really upsets ethiopians and most africans, and also Eritrea has joined the Arab league there for against ethiopia. so anything that originates from Eritrea is seen with suspicious, this is what i got from speaking with fellow avarage ethiopians in the street, i wanted to see myself what most people think. So the Eritrean road is a dead end road, most ethiopians also despise Eritreans and think any relationship with eritreans will bring eritreans to ethiopia in drove and they will demand they be treated better than ethiopians like pre 1991 when eritrea became the second biggest coffee exporter, more than Ethiopia when not one coffee tree exist in Eritrea. i am being honest with you. most ethiopians specially the young support the EPRDF regime as the least evil of all politician groups. Believe me when i tell you if you are Eritrean or Amiche who desire one day to return to your glory days in addis forget about it, it is better to worry about your own country then try to remove this government and install pro eritrean government, the hate is very deep now, more than i expected. the Oromos the Amaras, the ogadeans, gambellas, snnp all have one thing in common which suprised me they all do not like anything Eritrean, but disagree in many things, i am just being truly honest so you won't waste your time. the only way i see the melese regime could change is if an opposition who comes on a card of unity and progress with a young face will win over the people beside that old (shemagella) opposition that we see now are not liked more than eprdf trust me, be ewnat new yemilhe, i have no political aganda just speaking the truth.

01/30/11 @ 03:13

Comment from: Ali [Visitor]

*****

My message is to all people who hails from Oromos, Amharas, Somalis, Gurages, Sidamas and many nation/nationalities in Ethiopia. In the last 20 years or the whole Ethiopian history, different regimes has come and gone without address the real concern of the people.

There is no doubt that all regimes that occurred in Ethiopia made themselves busy with protecting their position. The current regime is not different. It is trying to avoid the current political change that is sweeping in the whole Northern African countries and Middle East. Dictators come and go but the nation will be there and it is time we should come together and design a plan B strategy.

The inevitability of downfall of Meles regime is unquestionable. The authoritarian regimes of Tunisia and Egypt are on the way out or already fell down. The current regime fate will not be different than them. Diaspora in the international community should come together and form a recognised international committee to steer the internal struggle in the country. I do not think simple sitting and watching the events unfolding in Ethiopia is not good for us and the country. we have responsibility to act now.

01/30/11 @ 03:23

Comment from: Ali [Visitor]

*****

Meles is selling our land to foreigners

and those whom he considers the saviour. In Ethiopia law are made to affect only a targeted group- political dissidents. Meles does not object to you if even violate the criminal code and kill people as long as you support him. This is what is happening in Somali Regional State. An illiterate depot called Abdi Mohamed Omar is killing the people of the region indiscriminately. His boss, Mr. Meles, accepts these killing with blessing. Abdi (Iley)enjoys cordial relationship with Meles. This is evident by the photographic opportunity posted all over the weyane and Iley's websites. I do not understand why Meles choose to favour a killer. is he a sadist who enjoys by the killing, murder, torture, and imprisonment of the mas. I do not think this is not the reason why all opposition parties and fronts fought against the Derge regime.

01/30/11 @ 03:41

Comment from: BOW [Visitor]

rise up for your land. of the most important struggle against eprdf should be the land grab. they are selling our land for 99 years. why 99 years? think about it. we need to make our voice heard.

01/30/11 @ 04:05

Comment from: one [Visitor]

THE BIGGEST ISSUE IN REGARDS TO ALL OPPOSITIONS ARE THEY ARE TOO OLD MAN FOR A COUNTRY WHERE 92% OF THE POPULATION IS UNDER 35 YEARS OLD. 3% OF POPULATION IS OVER 50 YEARS OLD. AND WHERE 100% OF THE OPPOSITION ARE 60 YEARS OLD. ALMARIAM IS 60+, DR. BERHANU IS 60+, SHAWALE AND DR. PETROS (I CALL HIM CRUSTY THE CLOWN FROM SIMPSONS) THEY LOOK LIKE THEY SHOULD HAVE BEEN DEAD COUPLE OF YEARS AGO, THEY LOOK LIKE MUMMIES. THE OPPOSITION NEEDS YOUNG FACE WITH 85% UNDER 35 TO RELATE TO YOUNG ETHIOPIANS LIKE MYSELF WHO IS 25 YEARS OLD. I WILL NEVER VOTE FOR ANY OF THE OPPOSITION EXCEPT FOR BURTUKAN BUT SHE GAVE UP. WHAT IF I VOTE FOR ONE OF THEM AND THEY HAVE A HEART ATTACK AND DIE THEN WHAT, PLUS LEFASUBEN NEW YEAROGETE FESE OR LEAD ME. COME ON MAN. THE OPPOSITION HAS NO BRIAN. THE CHANGE IN ETHIOPIA CAN ONLY COME FROM YOUNG PEOPLE BELIEVE ME, AND THE YOUNG NOW ARE DOING A FEW THINGS, THEY ARE CHEWING CHAT MERKANA ALL DAY EVERY DAY 30%, ADDICTED TO EUROPIAN CHAMPIONSHIP LEAGUE 30%, GOING TO SCHOOL TO BETTER THEMSELVES 30%, WORKING MINIMAL JOB TO SHOW OFF AND GET FEW GIRLS AND PARTY 10%, INTERESTED IN POLITICS LESS THAN 1%. GAME OVER.

01/30/11 @ 04:07

Comment from: ALPHA and OMEGA [Visitor]

GRAB what u want now! The bottom line is once we send the sell out TEGRES where they belongs , all FERNJI,ARABS and CIA agent SELATOS will be toosed out like meatlsess bone.

01/30/11 @ 04:21

Comment from: Ali [Visitor]

*****

What we can learn from classic and modern revolutions that occurred in the world in the last three centuries. starting from the French revolution in the eighteenth century to the current uprising in the Northern part of Africa and Middle East are a clear reminder of that susceptibility of oppressive regimes. Regardless of their military and economic power, they could be challenged by the will of the people even with bare hand. 80 million people descending on the palace of the Sidis Kilo would be overwhelmed by only the sheer number. The repressive military machinery built to effect this would disintegrate by this mere number. History has shown us that no oppressive regime would survive if the will of the people have no tolerance for it. That is what happened in Tunisia. It is also happening in Egypt as we speak now. There is no reason why it would not next happen in Ethiopia.

bringing change to Ethiopia requires a strong resolve, we must work in coordinate way. This is the time to come together and see an alternative to the current deadlock in Ethiopian politics. The role of diaspora community is vital. We should not be diverted by the Meles's regime desperate attempt to buy time and talking about diaspora community contribution to the country.

We should use our power. we have different mode of power. one I prefer is the economic power. The diaspora send a massive amount of money to Ethiopia every year. The current government is starved of foreign currency at moment. If we sustain to boycott sending money to Ethiopia for at least six months, this government will come crumpling down.This also includes any money we send for investment.

The principle of non-violence is not cooperating with oppressive regime as long as it does not heed to the will of the people. Economy has power. As the brain behind the non-violence movement- Mahathama Gandi- clearly pointed out shunning any economy activity carry out by this regime is a prime target. I am advising you not to use any corporation which has a major trade relation with the regime business conglomerate. These businesses are wegagan bank, mega company, and other corporations.

Let us devise an economic block to stimulate the current change underway in Ethiopia. No money sent to Ethiopia for at least six months in order to facilitate the change.This money should also include investment money. But exception could be made to essential remittance sent to alleviate severe hardship, life saving money, for example money sent to purchase food, life saving health medication so on.

This is the new front the diaspora community should look at as an alternative to arm struggle to bring change in Ethiopia. We should also send a clear message to those who are engaged in land grab. Any land grab made within the current regime's tenure should be made void and invalid as soon as a representative government is set up in Ethiopia.

The Arabs, Djibouti, Sudanese, Chinese and other nations should be aware of the danger of their money lost if they irresponsibly engaged in misappropriating the ordinary peasants of Ethiopia their land. I do not know why people fail to learn from history. in the last time, the people revolution has achieved by confiscating the wrongly appropriated assets. This will be the fate for those who disregard the will of the people. We are coming and working day and night to bring change in Ethiopia.

01/30/11 @ 04:25

Comment from: one [Visitor]

THE OPPOSITION IS ALSO TOO DEPENDENT ON ERITREAN AND IS SEEN AS ERITREAN PUPPETS BY AVERAGE ETHIOPIAN. THIS DOES NOT HELP THE OPPOSITION BECAUSE ETHIOPIANS ARE NOT INTERESTED IN SHARING WHAT THEY HAVE WITH ERITREANS. ERITREA OR SHABIA IS SEEN AS THE ENEMY OF ETHIOPIA AND IS SUPPORTED BY EGYPT WHICH HAS ALWAYS BEEN THE ENEMY OF ETHIOPIA. THIS WILL NEVER CHANGE UNLESS THE NILE GET UP AND WALK OUT OF ETHIOPIA OR EGYPT, FOR ETHIOPIA AND EGYPT TO BE GOOD NEIGHBORS THE NILE HAS TO CHOOSE WHICH COUNTRY IT SHOULD ONLY EXIST...LOL BECAUSE AS LONG AS THE NILE IS IN BOTH COUNTRY THEY WILL ALWAYS BE ENEMIES AND ERITREA HAS CHOOSEN TO BE WITH EGYPT WHICH IS THE ENEMY OF ETHIOPIA SO IT MAKES ERITREA THE ENEMY OF ETHIOPIA ALSO....LMAOF. AS LONG AS THE OPPOSITION DOES NOT UNDERSTAND THEY NEED A YOUNG FACE AND DISTANCE THEMSELVES FROM ERITREAN, THEY WILL NEVER GET ANY SUPPORT. 85% OF ETHIOPIANS ARE UNDER 35 YEARS OLD AND 76% ARE UNDER 30 YEARS OLD AND DO NOT KNOW ERITREA WAS ONCE PART OF ETHIOPIA, THEY HAVE BEEN THOUGHT AND ASSUME ERITREA IS ETHIOPIA NEIGHBOR AND ENEMY OF ETHIOPIA, AND PART OF ARAB LEAGUE, I DON'T THINK THE OPPOSITION DO THEIR HOMEWORK ABO. THEY HAVE TO UNDERSTAND THIS IN ORDER TO BE AFFECTIVE. LETS EXAMINE THE OPPOSITION ONE BY ONE. OLF AND ONLF DON'T HAVE ANY SUPPORT BY ETHIOPIANS EXCEPT A FEW FROM THEIR OWN ETHNIC GROUPS, G7, EPPEF AND ALL AHMARA OPPOSITION, THEY WANT TO GET ASSAB BACK BUT WORK WITH ERITREANS SO THAT IS SEEN WITH SUSPICIOUS KNOWING SHABIA WILL NEVER GIVE UP ASSAB. KINIJIT LOST QUEEN BURTUKAN SO IT IS DEAD. DR. BERHANU IS SEEN AS A "COWARD, CHEESE BURGER WITH FRIES EATING FAT ASS" WHO BETRAYED ETHIOPIAS AND RAN TO AMERICA. ELIAS, TAMAGNE AND ETHIOPIA REVIEW CHEERLEADERS ARE SEEN AS ERITREAN PUPPETS. SO TELL ME WHAT OPPOSITION HAS THE HEART OF ETHIOPIANS BESIDE BERTUKAN. BY THE WAY I DON'T SUPPORT BURTUKAN BECAUSE SHE IS NOT READY TO LEAD ETHIOPIA BUT WAS THE ONLY CHALLENGE TO MELESE AND HE KNEW IT, BUT HE OUTSMARTED HER. THE RESET ARE SEEN AS POWER HUNGRY DIASPORA AND ARE HATED IN ETHIOPIA BELIEVE ME I JUST CAME FROM ADDIS BY THE WAY IS GREAT AND I HAD THE BEST TIME, AND SPOKE TO PEOPLE TO SEE WHAT THE ATMOSPHERE IS LIKE. OPPOSITION IS DEAD AND PEOPLE ARE JUST WORRIED ABOUT MONEY AND DO NOT TRUST EACH OTHER, THE MOST I SAW THAT IS DIFFERENT THAN WHAT WE ARE TOLD IN AMERICA IS PEOPLE ACTUALLY DO GET ALONG NO MATTER WHAT ETHNIC THEY ARE. THAT WAS FUNNY I HAD LUNCH WITH A GAMBELLA, OROMO, AHMARA , TIGRAY AND THEY ALL LAUGHED WHEN I TOLD THEM THE DIASPORA THINK THEY DON'T GET A LONG. THEY SAID THEIR PUTTING THEIR MONEY TOGETHER TO OPEN UP A IMPORT EXPORT COMPANY AND ALL THEY WERE INTERESTED IN WAS IF I KNOW A MARKET IN AMERICA THEY CAN EXPORT TOO AND WERE NOT INTERESTED IN POLITICS AT ALL, AND BRUSHED ME OFF WHEN I BRING UP POLITICS AND THEY KEEP ASKING ME TO SEE IF A MARKET EXIST AND IF I CAN BUY THEM SIM CARD AND SEND THEM LAPTOP WHEN I GET TO AMERICA. THEY ALL TALK ABOUT MONEY AND BUSINESS AND NO POLITICS. POLITICS IS DEAD IN ETHIOPIA PEOPLE, EVERY ONE WANTS BUSINESS AND MONEY.

01/30/11 @ 04:32

Comment from: Abdisaa agaa [Visitor]

alex, the ethiopian

let me sum-up your honest description of how most ethiopians feel about Eritreans.

* A 'friendly' Eritrea is more dangerous to Ethiopia than a hostile one. in other words,

* The day Eritreans make peace with Eritrea is the beginning of the end for Ethiopia.

01/30/11 @ 04:43

Comment from: abdisaa agaa [Visitor]

sorry the second sentence should read,

* The day Eritreans make peace with Ethiopia will be the beginning of the end for Ethiopia.

01/30/11 @ 04:45

Comment from: Ali [Visitor]

The writer calling himself/herself 'one' failed to understand that the idea of big society is not a part but a whole components of the society. The children, young, the adolescents, the adults, the middle aged and the retired section of the society have active roles to play in the political life of Ethiopia. Mr. one is 'Ageist' ( have prejudice against old people) or he/she does not know what is talking about. This is the clear shortcoming. Beyond that evidence from other countries clearly corraborate the fact that people in their 60s or 70s can play constructive roles in their countries political roles. Maturity comes with wisdom. We should cherish people who have accumulated a resourceful experiences in their lives and can help us build a country that accept the opinions everyone.

Let us start by blank page and build a nation that protect and give a chance to voice of people who have never been given the opportunity to represent their side of the story. The so called 'one' is trying to convince us that we should follow his bigoted ideology. As a member of a civilised world I do not buy to this type of bigoted thinking. Rather go and learn how to build a sustainable community without affecting any one.

01/30/11 @ 04:50