In-depth

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Agriculture, predominantly smallholder farming as well as livestock production, is responsible for over 80% of Ethiopia’s employment figures and until recently the key sector in the economy.

Ethiopia has enjoyed an economic growth rate of around 11% in recent years thus placing it as one of the fastest growing economies in Africa. The government also projects Ethiopia’s real GDP to remain above 10% per annum.

The country’s recently launched national Growth and Transformation Plan (GTP) calls for the doubling of agriculture productivity, which has so far proved to be low despite improvements increases in average yields due to weather conditions, and increase of supply of inputs and cultivated land.

While agriculture, which accounts for 80% of national employment, continues to play a strong role in the Ethiopian socio-economic fabric, other sectors, such as services have started to make unprecedented growth in terms of share of the country’s GDP. However, unemployment remains a challenge, especially for the youth, which make up 20.5% of the population according to the 2008 census. 

UNDP's Interventions

UNDP intervention in Ethiopia follows a broad-based approach that strategically engages in supporting the country’s poverty reduction efforts in a manner that promotes economic growth. 

UNDP does this, on the one hand, through high level engagements with the government to provide policy advice and support emerging transformative initiatives.

On the other hand, UNDP’s presence on the ground is felt through its capacity building support to public and private institutions. It also works closely with local authorities to expand opportunities for citizens’ to tackle poverty and expand their economic growth opportunities.

In order to push forward the equitable growth agenda, UNDP is partnering with the Ministry of Finance and Economic Development (MoFED) to set up a Financial Inclusion Unit. The unit will coordinate projects using electronic systems to ensure financial inclusion of the rural population.

UNDP has supported the design of Ethiopia's multi-donor funded national Agriculture Growth Programme (AGP), which targets small and medium scale farmers. UNDP will annually provide the programme with one million USD during its implementation phase.

As a natural follow up to its commitment to the capacity-building aspects of the AGP, UNDP, in collaboration with the Gates Foundation, is at the forefront of supporting the Agricultural Transformation Agency (ATA) with 3.6 million USD financing.

 The ATA was set up by Ethiopia in recognition of its need to identify and address bottlenecks if the country is to meet its aim of doubling agriculture productivity by 2015. 

UNDP is helping ensure that the ATA has the institutional capacity to deliver on its mandate, of providing systemic solutions for pushing agricultural transformation forward, by financing the assignment of high level staffing for its top leadership positions.

 In partnership with the ATA, UNDP has also worked on addressing the need to improve the quality of Ethiopia’s agricultural products and thus their competitiveness in the global marketplace. The support has focused on working alongside the Ethiopian Institute for Agricultural Research (EIAR) to design and implement a new national agricultural products quality infrastructure (NAPQI) for Ethiopia. Support was also provided for the renovation of the EIAR quality control laboratory.