Ethiopia’s Government Key Policy Commitments Towards G8 Implementation: Current

Status and Future challenges

Ethiopia’s Country Team Contribution for

Agricultural Policy Exchange and Leaning Event King Fahd Hotel

Dakar, Senegal

May 13-16, 2013

Outline

G8 Policy matrix and its current status

Overarching constraints Private sector constraints Why these issues are important

to the country

G8 Policy framework to support the New Alliance

Initiatives in Ethiopia Since May 2012, the GoE has

made progress on some policy commitments, while others are pending;

Responsibility for implementing the New Alliance in Ethiopia was given to the new Private Sector Development Task Force (PSDTF) under the Agricultural Growth Pillar of REDFS

Policy Issue (#1): Increase private sector participation in seed development, multiplication, and distribution

Policy Actions Target period

Status

1 Ratify New Seed Proclamation

June 2012

passed in January 2013 by parliament

2 establish protocol to identify regulatory/administrative changes, necessary incentives for private sector, link research institutes

Dec. 2012

associated regulations are underway

G8 Policy framework (2)

Policy issue (#2) Increase ability of the private sector of the to

access markets by reducing barriers to competitiveness and increasing transparency of requirement;

Policy Actions 3. Establish a one-window service that assists agriculture investors ….. (April 2013)

Status of implementation The Ethiopian Investment Agency, has begun preparing

an agriculture desk to act as a “one-window service” The ATA has been created a new PPP unit to facilitate

private sector investments in the near term

G8 Policy framework (3)

4. Publish and disseminate business licensing procedures through

local radio, internet and newspaper … (April 2013)

Status … limited progress

5. Implement policy measures, as necessary, that secure ownership and crop

trading rights for commercial farms (Dec. 2013);

Status … No progress reported in this time

6. Commit not to impose export ban on commercial farm

output and processed goods;

Status …. export ban for some commodities are still in place;

G8 Policy framework (4)

7. Refine, as necessary, policies regarding agrochemical importation

Status: … Limited progress

8. Refine, as necessary, regulatory framework to stimulate private sector engagement in livestock production

Status: … The Ministry of Trade, with the

assistance of the Ministry of Industry, has drafted two proclamations that address the marketing issues .

G8 Policy framework (5)

Policy issue (#3) 9. Support an independent study of the impact to date of the Ethiopia Commodity Exchange

Status : IFPRI expected to study

10. Strengthen land use rights to stimulate investment in agriculture

Status …. About 9.4 million households (86.3%) have been registered and of these 73.2% (8 million) obtained first level landholding certificates

11. Refine land law, if necessary, to encourage long‐term land

leasing and strengthen contract enforcement for commercial

farms

Status … No progress reported

G8 policy framework (6)

12. Develop and share a land use planning framework Status ….. No progress has been made

13. Enable financial institutions to support smallholder farmers and agribusiness (e.g. warehouse receipts, out‐grower contracts, machinery leasing, etc.)

Status: warehouse receipt: The ATA in partnership with the ECX and the USAID AMDe

program is working to expand the existing warehouse receipt system to allow smallholder farmers to get access to credit using stored commodities as collateral;

Out-growers contract: The ATA has been facilitating contract farming agreements between cooperative unions and private sector processors

Input credit : redesigned input credit delivery system that leverages the strengths of the country’s microfinance institutions thus reducing the ris

14. Develop and share a land use planning framework Status …. No progress to report at this time.

G8 Financial Commitments: Progress by Country

Committed Vs. disbursement

Disbursement as % share of total

committed fund

CountryCommited Disbursement

made to date % of

disbursement

USA 463 351.5 76Canada 98 54.2 55France 76.25 0 0Germany 50.2 56.4 112Italy 40 0 0Japan 70 41.82 60UK 179 40.3 23EU 245 129.1 53

USA

Cana

da

Fran

ce

Germ

any

Ital

y

Japa

n

Unite

d Kin

gdom

Euro

pean

Uni

on

0

20

40

60

80

100

120

76

55

0

112

0

60

23

53

4: National Institutional Structure to Facilitate Agricultural Investment

3. Overarching constraints

Implementation of policies is one of series problems There are several new and existing policy packages

but in most cases not implemented properly For instance: Private investor on agriculture entitled for duty

free import of machinery ….. but passing customs requirement so costly

Limited capacity both at government and private sector level

Lack of clear accountability at different levels of tiers of government machinery

4. Private sector constraints

Access to land Access for agricultural credit

Access to basic infrastructure (feeder road network, etc)

Governance at different levels

Weak private sector capacity Effectiveness of service delivery for private

sector at different level is under question.

5. Why these issues are important to the country

Transformation agricultural sector means transformation of lives of millions in Ethiopia;

Putting stronger emphasis on private sector development

it to be engine of economic growth acceleration

market-based agricultural investment sustainable development;

Thank

you !!