Ethiopia's agrifood system: Past trends, present challenges, and future scenarios


Book Description

Ethiopia has experienced impressive agricultural growth and poverty reduction, stemming in part from substantial public investments in agriculture. Yet, the agriculture sector now faces increasing land and water constraints along with other challenges to growth. Ethiopia’s Agrifood System: Past Trends, Present Challenges, and Future Scenarios presents a forward-looking analysis of Ethiopia’s agrifood system in the context of a rapidly changing economy. Growth in the agriculture sector remains essential to continued poverty reduction in Ethiopia and will depend on sustained investment in the agrifood system, especially private sector investment. Many of the policies for a successful agricultural and rural development strategy for Ethiopia are relevant for other African countries, as well. Ethiopia’s Agrifood System should be a valuable resource for policymakers, development specialists, and others concerned with economic development in Africa south of the Sahara.




Ethiopia's agrifood system: Past trends, present challenges, and future scenarios: Synopsis


Book Description

Ethiopia has experienced impressive agricultural growth and poverty reduction, stemming in part from substantial public investments in agriculture. Yet, the agriculture sector now faces increasing land and water constraints along with other challenges to growth. Ethiopia’s Agrifood System: Past Trends, Present Challenges, and Future Scenarios presents a forward-looking analysis of Ethiopia’s agrifood system in the context of a rapidly changing economy. Growth in the agriculture sector remains essential to continued poverty reduction in Ethiopia and will depend on sustained investment in the agrifood system, especially private sector investment. Many of the policies for a successful agricultural and rural development strategy for Ethiopia are relevant for other African countries, as well. Ethiopia’s Agrifood System should be a valuable resource for policymakers, development specialists, and others concerned with economic development in Africa south of the Sahara.




Revisiting the demand and profitability of chemical fertilizers amid global fuel-food-fertilizer crisis: Evidence from Ethiopia


Book Description

We revisit the state of smallholder fertilizer demand and profitability in Ethiopia in the face of the recent global fuel–food–fertilizer price crisis triggered by the Russian–Ukraine war and compounded by other domestic supply shocks. We first examine farmers’ response to changes in both fertilizer and food prices by estimating price elasticity of demand. We then revisit the profitability of fertilizer by computing average value–cost ratios (AVCRs) associated with fertilizer application before and after these crises. We use three-round detailed longitudinal household survey data, covering both pre-crisis (2016 and 2019) and post-crisis (2023) production periods, focusing on three main staple crops in Ethiopia (maize, teff, and wheat). Our analysis shows that fertilizer adoption, use, and yield levels were increasing until the recent crises, but these trends seem halted by these crises. We also find relatively large fertilizer price elasticity of demand estimates, ranging between 0.4 and 1.1, which vary across crops and are substantially larger than previous estimates. We find suggestive evidence that households with smaller farm sizes are relatively more responsive to changes in fertilizer prices. We also document that farmers’ response to increases in staple crop prices is not as strong as perceived and hence appears to be statistically insignificant. Finally, we show important dynamics in the profitability of chemical fertilizer. While the AVCRs show profitable trends for most crops, the share of farmers with profitable AVCRs declined following the fertilizer price surge. Our findings offer important insights for policy focusing on mitigating the adverse effects of fertilizer price shocks.




Working Today for a Better Tomorrow in Ethiopia


Book Description

Ethiopia has long prioritized creating more and better jobs as core to its sustainable and inclusive development. However, steady growth in the gross domestic product and gains in agricultural productivity in recent decades have not translated into better opportunities nor increased earnings for much of the population. The 2021 Labor Force Survey data reveal labor trends since 1999 and underscore these realities. Moreover, COVID-19 and other shocks have reinforced the disconnect between positive macroeconomic trends at a national level and stagnant incomes at the household level. Working Today for a Better Tomorrow in Ethiopia: Jobs for Poor and Vulnerable Households outlines how Ethiopia can leverage its social safety net programs to help poor and vulnerable workers earn more in today’s labor market. The government’s latest development planning policies focus on private sector growth and structural transformation to create more and better jobs. While these long-term reforms take hold, the jobs agenda also must include near-term measures to improve worker productivity in and connect people to jobs that already exist. Complementing cash transfers with capital, training, and other services can help workers earn more in their current work, diversify into new types of employment, or connect to available wage jobs.These investments can have an immediate impact for poor people in Ethiopia while also contributing to sustainable and inclusive development.




The rapid rise in domestic value chains of nutrient-dense foods (fruits, vegetables, and animal products) in Sub-Saharan Africa: Policy implications


Book Description

Despite African consumers under-consuming nutrient dense fruits and vegetables (FV) and animal products (AP), and the farm production and supply chains of these products are fraught with constraints that keep them from operating optimally, we find abundant recent evidence of dynamism in these sectors. To wit: (1) consumption of these products in levels and shares is already substantial and growing rapidly; (2) supply of these products is growing rapidly, just not yet much faster than population growth; (3) supply growth is manifested in a number of countries by dynamic “meso booms” with diffusion of farming and growth in midstream ("Hidden Middle") value chain segments; these booms are “grass roots” driven, without subsidy or management by government or NGOs or large companies. We reviewed recent survey-based evidence of these booms and discussed the drivers. The policy implications are the need for governments to invest in the conditions we found to be enabling these booms, that is, roads and wholesale markets and electrification and other infrastructure hard and soft.




Scoping study on Ethiopian sesame value chain


Book Description

The Consultative Group for International Agricultural Research (CGIAR) is the largest non-profit public agricultural research group globally. Recently, it has restructured itself into One-CGIAR with the intention of integrating its capabilities, knowledge, assets, people, and global presence for a new era of intercon nected and partnership-driven research towards achieving the Sustainable Development Goals (SDGs). One-CGIAR led the development of about 30 initiatives that aimed at addressing one more of the key impact areas of SDGs. One of these initiatives is “Rethinking Food Markets and Value Chains for Inclu sion and Sustainability,” referred to as rethinking markets in short. Rethinking Markets Initiative aims to provide evidence on what types of bundled innovations, incentive structures, and policies are most effec tive for creating more equitable sharing of income and employment opportunities in growing food markets, while reducing the food sector’s environmental footprint. The initiative has four work packages addressing different but interrelated issues and that are being implemented in one or more countries. Work Package 1 (WP1) is about making globally integrated value chains inclusive, efficient, and environmentally sustainable.




Emerging medium-scale tenant farming, gig economies, and the COVID-19 disruption: Evidence from commercial vegetable clusters in Ethiopia


Book Description

Driven by the fast spread of private irrigation pumps, there has been a rapid expansion of intensive vegetable cultivation in the central Rift Valley in Ethiopia, making it the most important commercial vegetable production cluster in the country. Supporting that “quiet revolution” has been an inflow of migrant laborers – paid through daily, monthly, or piecemeal contracts, with few employment benefits attached to them – and a gig economy as widely-used contractors organize, among others, mechanized land preparation, the digging of wells and ponds, seedling propagation, and loading of trucks. Almost 60 percent of the irrigated area is cultivated by medium-scale tenant farmers relying on short-term rental contracts. It seems that gig economies characterized by flexible contract arrangements implemented by outside contractors, which are increasingly fueling sophisticated sectors in developed countries, are important in these commercial agrarian settings in Africa as well. We further find that the COVID-19 pandemic has led to significant disruptions of this model, as seen by more limited access to services and the unavailability or high price increases in factor markets, especially for labor. We further note large but heterogenous price changes in output markets. The pandemic seems especially to have had important effects on the medium-scale tenant farmers as they depend relatively more than smallholders on outside inputs, labor markets, and these gig economies. However, on the other hand, they benefit more than smallholders from favorable output markets for vegetables.




Understanding characteristics, causes, and consequences of migration: Contributions from the CGIAR Research Program on Policies, Institutions, and Markets


Book Description

It is estimated that nearly one in seven people — more than 1 billion in total — are classified as migrants in national statistics. Of these, about 763 million are estimated to be internal migrants; the remaining 281 million are international migrants (International Organization for Migration 2021). Migration is an intrinsic part of the development process, representing one of the greatest opportunities to facilitate economic and social advancement in developing countries. Understanding how different types of individuals and households perceive these opportunities and overcome related constraints, and how these change over time, is of key interest. At the same time, migration presents one of the world’s biggest challenges, requiring adjustments by both sending and hosting communities, and understanding those adjustments is a priority. The CGIAR Research Program on Policies, Institutions, and Markets (PIM) has undertaken more than 40 studies designed to explore the causes and consequences of internal and international migration. In aggregate, the studies help us understand what motivates people to migrate and what factors impinge on their ability to do so. These studies focused on the relationship of migration with rural transformation, gender, youth, climate change, and social protection and cut across the whole PIM research portfolio. This brief synthesizes findings from this research in an attempt to present a more complete picture. While there is a vast literature on migration external to PIM and CGIAR, the results of the PIM investiga­tions constitute valuable inputs into national pol­icies and programs designed to foster economic and social development while maximizing the benefits and reducing the risks of migration.




Estimating the cost and affordability of healthy diets: How much do methods matter?


Book Description

Cost and affordability of healthy diet (CoAHD) metrics developed in a handful of academic studies have quickly become mainstream food security indicators among major development institutions. The World Bank and FAO now report CoAHD statistics in their widely used databanks, and the UN’s State of Food Insecurity and Nutrition in the World (SOFI) reports CoAHD metrics on an annual basis, with the headline conclusion being that over 3 billion people worldwide cannot afford a healthy diet. While quantifying affordability constraints is indeed a vital addition to the suite of global food security indicators, there is a dearth of scientific analysis on the accuracy and sensitivity of CoAHD methods. Published global CoAHD estimates rely on three implicit assumptions: that demographic differences across countries have little effect on average diet costs; that non-food expenditure requirements have little systematic variation across countries; and that international food price data is representative in a population sense and product coverage sense. Testing these assumptions on the cost of the EAT-Lancet reference diet, we find sizable sensitivity of baseline methods to adjusting diet affordability estimates for systematic cross-country differences in demographic profiles and non-food expenditure requirements, smaller effects of adjusting for inadequate food product coverage in international price data, and inconclusive evidence on issues of urban bias in price surveys. Our proposed methodological improvements significantly change country, regional and global estimates of healthy diet affordability, though not the headline conclusion that several billion people cannot afford a healthy diet. Even so, the accuracy, rigor, and reliability of CoAHD statistics warrant closer investigation given their widespread adoption and utilization.




Innovation for Agribusiness (InovAgro): Household- and market-level impacts of value chain interventions


Book Description

Agriculture, in Mozambique, is characterized by production systems that are based predominantly on rainfed conditions and on low use of yield enhancing agricultural inputs. The Innovation for Agribusiness (InovAgro) interventions were designed to increase incomes for poor smallholder farmers in northern Mozambique. Using a market systems development (MSD) approach, the InovAgro implemented value chain interventions (VCIs) to promote the development of inclusive and sustainable market systems such that the interventions impacts were felt long beyond the project’s lifespan. This study evaluated the impact of the InovAgro VCIs on households (considering a range of outcomes related to farmers’ use of yield-enhancing agricultural inputs, access to information on agricultural input and output markets, maize productivity, women and youth empowerment, and household welfare. The study also explored InovAgro VCIs outcome indicators to evaluate market-level effects, namely: systemic (long-term), sustainability, large-scale (spillover or multiplier), and unintended (positive or negative) effects. We conducted a modified randomized controlled trial (RCT) using a spatial identification strategy to classify beneficiary and nonbeneficiary households; this was supplemented with three waves of household-level panel data (2015, 2017 and 2019). We also complemented key informant interviews (KIIs) and focus group discussions (FGDs) with local stakeholders, including market actors and local authorities, with two rounds of geospatial data (2017 and 2019). Our findings show that InovAgro VCIs had a positive and significant impact on beneficiaries’ use of yield-boosting agricultural inputs and on access to information on agricultural input and output markets. Our analysis also reveals that the InovAgro VCIs boosted maize productivity and increased the marketable surplus of maize among beneficiaries. InovAgro VCIs were seen to have unintended negative effects on access to, and control over, land by women and youth in the short term; in the longer term; however, these adverse effects were reversed and became positive and significant. Our findings also show that simultaneous exposure to all three VCIs under the complete package had a positive impact on overall household welfare. We also find evidence in support of the InovAgro VCIs having a systemic market effect and producing more sustainable long-term usage of yield-boosting agricultural practices than non-InovAgro VCIs. Our results elucidate that InovAgro VCIs benefitted large numbers of smallholder farmers beyond the project’s direct sphere of influence and targeted beneficiaries. The key takeaway message from our findings is that a more intense VCI, that is, delivery of the complete package, appears to be necessary to achieve a long-term positive effect on overall household welfare.