Ethiopia

INVESTMENT PRESENTATION

THE PROPOSAL

Ethiopia is presenting a set of three investment cases geared towards the enhancement of its Homegrown Economic Reform Agenda and focused on the agrifood systems sectors: national fertilizer production, including urea and organic fertilizer production; mechanization, including irrigation equipment and different size machineries assembling; and animal feed, including composite factories and commercial silage production. 

These investments are labeled as fundamental enablers to address critical bottlenecks to agriculture transformation in the country. The three investments are also main pillars for the implementation of the Ten-in-Ten national flagship program and several value chain development initiatives, including across those investment cases presented during last year’s forum (coffee, avocado, diary, and wheat). 

The total investment cost of all investment cases presented this year is of approximately USD $ 705 million with an estimated internal rate of return of 29%. 

These investments will create synergies with GoE’s own public investments. Ethiopia is currently investing over USD $ 433 million in enhancing agricultural productivity through extension and technical assistance; and over USD $ 114.7 million in mechanization, irrigation equipment, and private sector development, in addition to infrastructures and electrification investments. In addition to this another investment of USD$ 158 million is planned for the animal feed production.

Poverty

Potential

Efficiency

COMMODITIES AND INTERVENTIONS

National Fertilizer Production

The investment proposal for the national fertilizer production includes establishing 22 urea factories (Ogaden and other prioritized areas) with an estimated daily production of 1000 tons per day. Urban waste collected from different centers (Addis Ababa, Adama, Shashemane, Diredawa, Hawasa , Bahirdar, Gonder) will be used to establish 35 factories with an estimated yearly production of 65,000 tons of organic fertilizers per factory. The two sets of factories combined are expected to increase wheat productivity up to 50%.

Mechanization

The investment proposal includes a national supply scheme of irrigation equipment which will aim to meet the national land irrigation goal of 4-10% in ten years and help meet productivity targets of the horticulture sector. The investment model envisions national production of simple, affordable, and durable irrigation technologies (sprinklers, hose or drip, and water saving), equipment for source development (storage, wells) and distribution (pumps, pipes). 
The proposal also includes financing of small-scale mechanization equipment which aims at enhancing national production capacity of (10HP) walking tractors, and fill mechanization gaps of 7.4 million hectares of land needing these technologies, and up to 100HP tractors filling the mechanization gap of 6 million hectares of land need these technologies. The total cost includes 5 factories to produce walking tractors, bigger  tractors and supplements that could be attached as plows, tillers, harrowers,  spreaders, and trailers.

Animal Feed Production

The third investment case to be presented during the forum encompasses the establishment of 9 composite (concentrate feed) factory production, for which complementary investments will be required for fodder input production and 37 company-level silage production plants. Each of the silage production units feeds 1.8 million cows or equivalent cattle.   Although not all cattle access the concentrate feed, at least 260,000 cows or their equivalent can be fed by concentrate feed production using local inputs. With expansion of input sources, 8 more similar factories could be established to enlarge the number of cattle fed with concentrates.

See the investment plan slide deck presentation from Ethiopia for IF 2023.