1.13 million sq km
27 agro-ecological zones, with altitudes varying between -114 and 4543m above sea level (asl)

91.73 million inhabitants, second most populated nation on the African continent [Source: World Bank]
3% annual population growth [Source: Netherlands Embassy]
80 or more ethnicities [Source: Netherlands Embassy]
46% of the population is younger than 14 years of age [Source: Netherlands Embassy]

The Ethiopian Birr (ETB) is the country’s monetary unit, 100 Birr = 5 US$ (2013) Ethiopia’s gross domestic product (GDP) grew by 7% in 2012, however, it is still in the top-15 poorest countries of the world with a GDP per capita of US$410. [Source: CIA]

29% of the population lives below the poverty line [Source: World Bank]
46% of the national GDP is accounted for by agriculture [Source: ATA]
80% of Ethiopians work in the agricultural sector [Source: ATA]

The Government of Ethiopia aims at reaching the middle-income status before 2025, while developing a green economy. [Source: GoE]

Economic growth

Over the past years Ethiopia has achieved high economic growth and made considerable progress in achieving a number of the Millennium Development Goals. The country’s growth strategy with its emphasis on agricultural transformation and a strong expansion of public investment has delivered impressive results.

In the medium term it is most likely that significant changes in Ethiopia’s economy will take place. There will be more economic growth in industrial sectors (light manufacturing, mining) and agriculture (fruits and vegetables, flowers, sesame) and to a lesser degree in services.

Challenges ahead

In spite of the good results of the Government of Ethiopia (GoE) in terms of inclusive development and improving socio-economic indicators, Ethiopia will remain a very poor country by any standard for years to come. It is highly unlikely that the status of lower middle-income status will be reached in 2025 (GoE target).

Development cooperation will still be needed for the coming 10-15 years, while at the same time intensifying activities in the economic domain and looking for increased synergy between ‘aid and trade’.

Food first

Overall, these longer-term trends support the Embassy’s Food Security approach.

“Food security exists when all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life” [Food and Agriculture Organization (FAO) definition]

The strategy of achieving food security includes three main components: (1) supporting the most food insecure households and improving resilience to shocks, both through relatively large food/cash for work and community based nutrition programmes, (2) contributing to broad-based inclusive agricultural growth for surplus producing households enabling the transition to country-wide food security, and (3) enabling trade and investment through support to the emerging agribusiness sector.

In due course, a gradual shift (both in activities and resources) can be made, from food security to agricultural growth and from agricultural growth to agribusiness aid to transition; and from transition to trade.

Dutch expertise

In order to achieve this, the strengthening of local economic development is highlighted. In addition, specific Dutch expertise from the private sector (‘top sectors’) in the Netherlands is being accommodated. The sectors of horticulture, seeds and dairy are mentioned here in particular, as well as specific thematic areas like value-chain development, knowledge and innovation, and the cooperative organisation.

As around 80% of the Dutch companies in Ethiopia are active in the agricultural sector the Embassy will continue to focus on and provide support to the most important agribusiness subsectors:

- Horticulture (expected outcome: exports in value of fruits and vegetables increased by 30%, flowers by 40% by 2017);
- Dairy (100% increase in income for 65.000 households by 2017);
- Seeds (30.000 tonnes of quality seed produced by 2017);
- Sesame (30% increase of income for 70,000 farmers).

Secondly, in addition to the provision of general assistance to Dutch companies, support will be provided specifically to the development of the following potentially promising subsectors, in close cooperation with the recently established Agribusiness Support Facility: poultry, potato, soy, spices and aquaculture.