Ethiopian Review

The World Bank’s Board of Executive Directors approved 90 million dollars to strengthen agricultural productivity and growth in the East African region. The program will benefit Ethiopia, Kenya and Tanzania with an allocation of 30 million dollars each.

The East Africa Agricultural Productivity Program was approved by the Bank’s Board of Executive Directors last Thursday June 11, 2009.

The Bank will support the three countries to reinforce and scale up regional cooperation in technology generation, training and dissemination programmes for regional priority commodities. These include dairy, cassava, rice and wheat.

Agriculture accounts for 2/5 of the Gross Domestic Product (GDP) in East Africa and it is the primary source of income for more than two-thirds of the population. It is important for poverty reduction and better livelihoods for the people of the three countries which have a combined population of nearly 160 million.

“Agricultural technology is fundamental to growth in productivity and will enable agriculture to play a transformative role in Africa’s economic development,” says Karen Mcconnell Brooks, the Bank’s sector manager for Agriculture and Rural Development in the Africa Region. “This program will contribute to the growth, structural change and food security of the three East African countries.”

Improved regional agricultural technology systems can deliver benefits for food security in the short run and also boost longer term economic growth. The recent sharp increase in the price of food, especially cereals and oilseeds, created hardships for consumers but also created opportunities for farmers in the region.

“Advanced technologies are necessary to empower farmers to improve their responsiveness to food price shocks through increased access to inputs, including seeds of improved cultivators and improved livestock,” says David Nielson, the Task Team Leader of the Program. “This programme will support the three countries to lower barriers of movement of technologies across borders and increase the regional space for input markets that are presently constrained by the small size of national markets,” he said.

The programme will support efforts to scale up and develop national research programmes into Regional Centres of Excellence that will take a leading role in technology generation, dissemination and training on a regional basis. It is part of the Bank’s regional agricultural strategy to support activities that will be coordinated across three or more countries and generate benefits that spill over country boundaries. It will also strengthen regional integration in the Common Market for Eastern and Southern Africa (COMESA) and provide a platform for regional agricultural policy harmonization.

The programme will complement the agricultural investment programmes that are being implemented in the three countries. These include the 82 million dollar Kenya Agricultural Productivity and Agribusiness Project that was also approved by the Board last Thursday, to enable Kenya’s small farmers to increase farm productivity and to promote agribusiness development. It is also linked to the Kenya Agricultural Productivity and Sustainable Land Management Project financed by the Global Environment Facility (GEF) to facilitate agricultural producers in three important catchment areas to adopt environmentally sound land management practices.

The Bank provided emergency intervention for the recent global food prices crisis. In December 2008, it approved an emergency grant of 250 million dollars under its Global Food Crisis Response Program to assist Ethiopia in dealing with serious food shortfalls, high input prices and the impact of the global financial crisis. It also provided a similar grant of five million dollars to Kenya in April 2009.

During the appraisal stage the programme was given a budget of 120 million dollars to be divided among four beneficiaries, Ethiopia, Kenya, Tanzania and Uganda.

However, after the bank approved the project, Uganda was omitted and 30 million dollars was cut from the grand total.

The loan which has a 10 year grace period is payable in 40 years.

The project development objective is to enhance regional specialization in agricultural research and to facilitate increased sharing of identified agricultural technologies across national boundaries.

The Bank stated earlier this April that it would provide Ethiopia a little over one billion dollars in the next fiscal year of the bank which starts on July 1, 2009.

- By Amanyehun Redda | Addis Fortune