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Ethiopian economy has grown at an average rate that surpasses that of almost any other economy in the region over the last two decades. At the center of this development is the high priority placed on accelerating agricultural growth and achieving food security and poverty alleviation. Over the years, maize has become a main food security crop, widely produced and consumed by smallholder farmers, second only to teff in terms of area. Despite the sustained growth of maize production over the years, its yields continue to be lower than the world’s average. Of the many abiotic and biotic constraints that maize faces, insect attacks and droughts are two critical ones. The genetically modified TELA maize can help address these constraints. This paper estimates the economic benefits of adopting this new technology and the opportunity cost that Ethiopia will incur if its adoption is delayed. The analysis is conducted using an economic surplus partial equilibrium model run with the newly developed DREAMpy software, data drawn from the Ethiopia Socioeconomic Survey, Wave 3 2015-2016, econometric estimations using these survey data, and other local data and sources. The estimations show that if the drought tolerant and insect resistant TELA maize is planted in 2023 the net present-value of benefits for producers and consumers would be around $850 million. Producers from the mid-altitude maize zone will be the main beneficiaries, given the targeted area of TELA maize. Consumers from all areas will benefit from the projected reduction in price. If the adoption of this new technology is delayed by 5 years, the estimated net present value of benefits will fall by 30 percent. These costs underscore the importance of having a regulatory system that is efficient, predictable, and transparent and ensures that the projected economic benefits are realized.
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.
This landmark volume presents the results of a comprehensive and coherent in-depth assessment of Ethiopian agriculture and draws lessons from it to generate actionable recommendations that will inform policy decisions and priority setting for agricultural transformation across Africa. Policy makers in Africa are faced with the challenges of ensuring food and nutrition security and the economic wellbeing of their rapidly growing populations while at the same time maintaining the integrity of their natural resource base. Between 2000 and 2021, 74% of the growth in overall crop production on the continent was derived from increases in land area expansion, while increases in yield contributed only 26% of the growth. This unchecked expansion of land use puts the sustainability of the natural resource base under severe pressure. This book draws on a unique set of case studies from Ethiopia described and told from a truly African perspective.