Ethiopia has great agricultural potential because of its vast areas of fertile land, diverse climate, generally adequate rainfall, and large labor pool. Agriculture accounts for 36% percent of the nation's Gross Domestic Product (GDP) as of 2020. Many other economic activities depend on agriculture, including marketing, processing, and export of agricultural produce.
Despite this potential, however, Ethiopian agriculture has remained underdeveloped. Because of drought, which has repeatedly affected the country since the early 1970s, a poor economic base (low productivity, weak infrastructure, and low level of technology), and overpopulation, the agricultural sector has performed poorly. Production is overwhelmingly of a subsistence nature, and a large part of commodity exports are provided by the small agricultural cash-crop sector.
Principal crops include coffee, pulses (e.g., beans), oilseeds, cereals, potatoes, sugarcane, and vegetables. Exports are almost entirely agricultural commodities, and coffee is the largest foreign exchange earner. Coffee, which originated in Ethiopia, is the largest foreign exchange earner.
Coffee harvest in Ethiopia
Agriculture accounted for 50% of GDP, 83.9% of exports, and 80% of the labor force in 2006 and 2007, compared to 44.9%, 76.9% and 80% in 2002-2003, and agriculture remains the Ethiopian economy's most important sector.
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Historically, Ethiopia was a rare exception in Sub-Saharan Africa, because of its special environmental circumstances, that enabled Ethiopian farmers to increase their productivity, for example by using ploughs. The beneficial climate in the Highlands of Ethiopia also enabled irrigation and other advanced agricultural technology.
Challenges in Ethiopian Agriculture
Ethiopia's agriculture is plagued by periodic drought, soil degradation caused by overgrazing, deforestation, high levels of taxation and poor infrastructure (making it difficult and expensive to get goods to market). As 85% of Ethiopians rely primarily on land (agricultural and pastoralism) for their livelihoods and a quarter of the population lives below the national poverty line, land degradation is a major concern. Soil erosion has been one of the country's major problems.
Over the centuries, deforestation, overgrazing, and practices such as cultivation of slopes not suited to agriculture have eroded the soil, a situation that worsened considerably during the 1970s and 1980s, especially in Eritrea, Tigray, and parts of Gondar and Wollo. In addition, the rugged topography of the highlands, the brief but extremely heavy rainfalls that characterize many areas, and centuries-old farming practices that do not include conservation measures have accelerated soil erosion in much of Ethiopia's highland areas.
Ploughing with cattle in southwestern Ethiopia
Horticulture Sector in Ethiopia
The horticulture export sector is young, and it has shown quite an exponential growth in the last ten years. Currently, there are 126 investments in Ethiopia in the export of flower, fruits, vegetables, and herbs. Currently the flower, fruit, vegetable, and herb farms occupy 10,897.21hectars of land. The horticulture sector employs 199,640 citizens and in 2017/18 fiscal year generated US$ 307.04 million.
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Favorable climate, availability of land and the incentive packages provided by the government have all contributed to the phenomenal and successful growth of the floriculture sector in the last 14 years. The country is noted for high-quality flowers.
Although Ethiopia has a long tradition of producing fruits like banana, pineapple, mango for home consumption and neighboring countries export, it is only recently that the investment has been made in large scale production and the production of less traditional fruits including strawberries, table grapes, and passion fruits. Currently, there are nineteen operators engaged in large scale and modern fruit production.
At present, there are 31 vegetable exporting farms throughout the country. These farms produce a wide variety of vegetables including green beans, snow peas, tomato, paprika, eggplant, baby corn, onions, and Physalis.
Ethiopia’s climate is very well and suitable for the production of herbs, and many investors are keen to exploit the potential.
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Land Tenure and Reform
Until the 1974 revolution, Ethiopia had a complex land tenure system, which some have described as feudal. In Wollo Province, for example, there were an estimated 111 types of land tenure. By the mid-1960s, many sectors of Ethiopian society favored land reform. University students led the land reform movement and campaigned against the government's reluctance to introduce land reform programs and the lack of commitment to integrated rural development.
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Following their rise to power, on March 4, 1975, the Derg proclaimed their land reform program. The government nationalized rural land without compensation, abolished tenancy, forbade the hiring of wage labor on private farms, ordered all commercial farms to remain under state control, and granted each peasant family so-called "possessing rights" to a plot of land not to exceed ten hectares.
Despite the Derg's efforts to reassure farmers that land reform would not affect them negatively, northerners remained suspicious of the new government's intentions. Government attempts to implement land reform also created problems related to land fragmentation, insecurity of tenure, and shortages of farm inputs and tools.
Agricultural Policies and Programs
During the imperial period, the development of the agricultural sector was retarded by a number of factors, including tenancy and land reform problems, the government's neglect of the agricultural sector (agriculture received less than 2 percent of budget allocations even though the vast majority of the population depended on agriculture), low productivity, and lack of technological development.
In 1971 the Ministry of Agriculture introduced the Minimum Package Program (MPP) to bring about economic and social changes. The MPP included credit for the purchase of items such as fertilizers, improved seeds, and pesticides; innovative extension services; the establishment of cooperatives; and the provision of infrastructure, mainly water supply and all-weather roads.
After 1975 the revolutionary government used peasant associations to accelerate conservation work throughout rural areas. The 1977 famine also provided an impetus to promote conservation. The government mobilized farmers and organized "food for work" projects to build terraces and plant trees.
Another major component of the Derg's agricultural policy was the development of large-scale state farms. By 1989, the area covered by the State Farms had grown to a total of 220,000 hectares. The primary motive for the expansion of state farms was the desire to reverse the drop in food production that has continued since the revolution.
Land Types and Soil Conditions
Of Ethiopia's total land area of 1,221,480 square kilometers, the government estimated in the late 1980s that 15 percent was under cultivation and 51 percent was pasture. It was also estimated that over 60 percent of the cultivated area was cropland. Forestland, most of it in the southwestern part of the country, accounted for 4 percent of the total land area, according to the government.
Most agricultural producers are subsistence farmers with small holdings, often broken into several plots. Most of these farmers lived in the Ethiopian Highlands, mainly at elevations of 1,500 to 3,000 meters.
There are two predominant soil types in the highlands. The first, found in areas with relatively good drainage, consists of red-to-reddish-brown clayey loams that hold moisture and are well endowed with needed minerals, with the exception of phosphorus. The second type consists of brownish-to-gray and black soils with a high clay content. These soils are found in both the northern and the southern highlands in areas with poor drainage.
The population in the lowland peripheries (below 1,500 meters) is nomadic, engaged mainly in livestock raising. Sandy desert soils cover much of the arid lowlands in the northeast and in the Ogaden of southeastern Ethiopia. The plains and low foothills west of the highlands have sandy and gray-to-black clay soils. Where the topography permits, they are suitable for farming. The soils of the Great Rift Valley often are conducive to agriculture if water is available for irrigation.
| Statistic | Value/Percentage |
|---|---|
| GDP Contribution (2020) | 36% |
| Land Under Cultivation (late 1980s) | 15% of total land area |
| Land Used as Pasture (late 1980s) | 51% of total land area |
| Horticulture Sector Employment | 199,640 citizens |
| Horticulture Sector Revenue (2017/18) | US$ 307.04 million |
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