Table Of Content_Q 0 - -December 1969
Final Report
DEVELOPMENT OF AGRICULTURE AND
AGRO-INDUSTRY IN ETHIOPIA
Strategy and Programs
Prepared for:
THE TECHNICAL AGENCY
IMPERIAL ETHIOPIAN GOVERNMENT
r' N STANFORD RESEARCH INSTITUTE
rLC Menlo Park, California 94025 • U.S.A.
Final Report
DEVELOPMENT OF AGRICULTURE AND
AGRO-INDUSTRY IN ETHIOPIA
Strategy and Programs
By: CLARENCE . MILLER, WILLIS W. SHANER, and RAYMOND E. BORTON
Prepared for:
THE TECHNICAL AGENCY
IMPERIAL ETHIOPIAN GOVERNMENT
SRI Project 6350
KENYA~
a PROVINCIAL CAPITAL
* OTHER TOWN
ALL WEATHER ROADS
DRY WEATHER ROADS
*illill4NI4INI RAILROAD
PROVINCIAL 8OUNDARIES
TRANSPORTATION FACILITIES, PROVINCIAL DIVISIONS, AND
KEY TOWNS OF ETHIOPIA
ii
CONTENTS
FRONTISPIECE . 11.
LIST O F ILLUSTRATIONS xv
LIST OF TABLES . . . . . xvii
PREFACE xix
A NOTE ON PLACE NAMES xxxi
Part I: A Strategy for Agricultural
and Agro-Industrial Development
I GOALS OF NATIONAL DEVELOPMENT STRATEGY . . . . . . . 5
A. Expanding the Supply of Food Staples Relative to
Demand . . . . ... . . . . . . . . . . . . . . 5
B. Increasing Foreign Exchange Earnings 7
C. Expanding Investment Funds 7
D. Building Foundations for Future Growth 7
II DESIGN OF A STRATEGY FOR DEVELOPMENT . ....... 9
A. Efficient Use of Funds and Manpower ...... 9
B. Expanding of "Market Oriented" Agriculture for
Greatest Impact . . .... 9
C. Concentration of Efforts . . . . . . . .. . 10
D. Package Programs . . . . . . . . . 13
E. Making Supplies and Services Available . . * . . 14
F. Encouraging Investment ........... . 15
iii
I)I,
CONTENTS
Part I (Continued)
II (Continued)
G. Building Institutions, Programs, and Public
Services . . . . . . . . . . . . . . . . . . . . . 17
K. Recognition of Agriculture as a Base for National
Development . . . . . . . . . . . . . . . . . . . 18
I. Extension of Agro-Industries as the Base for
Industrialization . . 19
III PROJECT SELECTION ................. .. 21
A. Bases for Selection . . . . . . . 21
B. Agro-Industries . . . . . . . . . . . . . . . . . 23
C. The Third Five-Year Plan . . . . . . . . . . . . . 24
D. Areas ot Work and Projects Selected . . , . . , . 25
1. Livestock and Animal Products 26
2. Cereal Grains and Pulses . . 26
3. Oilseeds . . . . . . . . . . 26
4. Cotton . . . . . . . . . . . 27
5. Tools and Machinery..... 29
6. Fruits and Vegetables . . . . 30
7. Supplementary Irrigation . . 30
8. Chemicals and Fertilizer . . 31
9. Port Development . . . . . . 31
10. Agricultural Credit . . . . . 31
11. Systems Analysis Studies . . 31
12. Studies in Depth . . . . . . 32
b
CONTENTS
Part II: A Plan of Action
Program I FARM INPUTS FOR AGRICULTURAL PRODUCTION
A. Farm Machinery . .......... ..
B. Feed . .................
1. Livestock Forage
a. Improving Forage Supply . . .
b. Shift to Managed Pastures
c. Forage Research Program
2. Feedlots . . . . .
3. Grain Production
C. Fertilizers
D. Chemicals
E. Improved Seed
F. Improved Farm Management.........
G. A Five-Year Program
Program II AGRICULTURAL "PACKAGE" PRODUCTION . . . 57
A. The Ada "Package . . . 59
B. Recommendations for Ada Development . . . . . 60
C. Other Aspects of Ada Development . . . . . ... . . . . 63
1. Education . . . . . . . . . . . . . . . . . . . . 63
2. Human Health . . . . . . . . . . . . . . . . . . 64
3. Animal Health and Husbandry . . . . . . . . . . . 65
4. Grain Storage . . . . . . . . . . . . . . . . . . 66
5. Industry . . . . . . . . ... . . . . . . . . . . 66
6. Forestry and Conservation . . . . . . . . . . . . 67
7. Tourism . . . . . ... . . . . . . . . . . . . . . 67
8. Social and Political Aspects . . . . . . . . . . 68
V
71
CONTENTS
Part II (Continued)
Program II (Continued)
D. Recommendations for Implementation of Ada
District . . ............... ..................... 69
1. Sponsorship S. 69
2. Organization. . ......... . . . .. . . 69
3. Responsibility . .............. S. 71
4. The Program After Ten Years . . . ... . . . . . 72
E. Package Crop Production Areas . . 73
1. Area I--Debre Zeyt/Nazret Area . . . S. 73
2. Area II--Addis Abeba/Debre Berhan-Fiche Area . . 75
3. Area III--Lake Tana Area ... ...... .. . . 75
4. Area IV--Dese Area... . . . . ...... . . . 75
5. Area V--Harer Area . . . . . . . . . . . . . . . 76
6. Area VI--Asmera/Northern Tigre Area . . . . . . 77
7. Area VII--Shashemene Area . . . . . . . . . . . 77
8. Area VIII--Debre Marqos Area . . . . . . . . . . 77
9. Area IX--Bako-Lekempti-Gimbi Area . . . . . . . 78
10. Area X--Jima-Bedele Area . .... . . . . . . . . . 78
11. Area XI--Setit-Humera Area . . . . . . . . . . . 78
12. Area XII--Asela-Ticho-Robi-Beqoji Area . . . . . 79
13. Possible Areas for Castor Bean Production . . 79
F. Research Designed to Increase Oilseed Production . . 80
G. Cattle Package Production Areas . . . . 84
H. A Five-Year Plan . ............... 85
vi
CONTENTS
Part II (Continued)
Program III SUPPLEMENTAL IRRIGATION FOR AGRICULTURAL
PRODUCTION . . . . . . . . . . . . . 89
A. Implementation of Dogali Project . . . 91
1. Organization . . . . 93
2. Financing 93
3. Additional Government Involvement 94
B. Implementation of Emberemi Project 95
1. Pilot Farm . . ......... 96
2. Training and Advisory Services . 96
3. Monitoring Groundwater . . . . . 97
4. Storage Reservoirs ....... 97
C. Implementation of Borkenna Project 98
1. Project Planning and Financing . . . . . . . . . . 98
2. Water Rights . . . . . . . . . . . . . . . . . . . 98
3. Project Area Land Owners . . . . . . . . . . . . . 99
4. Loan Sources in Ethiopia . . . . . . . . . . . . . 99
5. Possible Foreign Investment . . . . . . . . . . . 100
6. Other Considerations . . . . . . . . . . . . . . . 100
7. Crop Suitability . . . . . . . . . . . . . . . . . 101
D. A Ten-Year Schedule for Implementation . . . 102
1. Net Foreign Exchange Earnings . 104
2. Other Strategy Considerations . . . 104
3. Employment...... ..... . . . . . . . .. 105
4. Suggestions for Government Action . . . 105
E. A Five-Year Plan . 107
vii
CONTENTS
Part II (Continued)
Program IV AGRICULTURAL CREDIT......... . . . . .. 111
A. Farmer Classification for Loan Purposes . . . . . 111
B. Proposed Credit Program... . . . . . . . . .. 112
C. Small Agricultural Credit Loans Account . . . . . 115
1. Establishment of a Loan Committee . . . . . 117
2. The Role of Agricultural Extension Officers
and Community Development Officers . . . . . 118
3. Selecting Areas for Small Credit Loans . . . 119
4. Individual Loan Procedures . . . . . . . . . 121
D. Storage and Marketing Facilities 123
E. Recommended Changes in Bank Practices . . . . 125
1. Interest Rates . ... . . . . . . . . 125
2. Publicity to Increase Bank Deposits 126
3. Deposit Insurance . . . . . . . . . 126
4. Chattel Mortgages . . . . . . . . . 126
5. Other Credit Organizations...... 127
* F. A Recommended Private Rural Bank Program-for
Ethiopia . . . . . . . . . . . . . . . . . 128
G. A Five-Year Credit Plan . 129
Program V PROCESSING OF AGRICULTURAL PRODUCTS 131
A. Solvent Extraction of Oilcake . . . . 132
1. Inter-Industry Relationships . . 134
2. Labor Availability . . . . . . , 135
3. Implementation... . . . . .. 135
viii
CONTENTS
Part II (Continued)
Program V (Continued)
B. Castor Oil Production . . . . . .. . . . 137
1. Assistance to the Enterprise . . . . 139
a. Seed Imports . . . . . . . . . 139
b. Port Development . . . . . . . 139
c. Land Development Encouragement 140
d. Inter-Industry Relationships 140
2. Implementation . . ........ 141
a. Production State . . . . . . 141
b. Processing Stage . . . . . . . . 142
3. Other Uses for the Plant . . . . . . . . . . . 143
C. Dry Salting Treatment of Cattle Hides . . . . . . . 144
1. Expansion Potential . . . . 145
2. Inter-Industry Linkages . . 145
3. Implementation...... ..... .. . .. 146
a. Organization and Financing . . 146
b. Reactivation of Malgue Wendo Abattoir . . 147
c. Cooperation with Livestock and Meat Board 148
d. Local Buying Stations . . . . . . . . . . 148
e. Hide Marketing Arrangements . . . . . . . 149
f. Construction of Building . . . . . . . . 149
g. Recruitment of Labor Force . . . . . . . 150
h. Purchasing Equipment, Tools, Supplies . . 150
i. Initial Pilot Operations . . . . . . . . 151
j. Expanding to Full Volume . . . . . . . . 151
k. Replication of the Project . . . . . . . 152
D. A Five-Year Program...... ..... .. . .. 152
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Description:DEVELOPMENT OF AGRICULTURE AND AGRO-INDUSTRY IN ETHIOPIA . I. Extension of Agro-Industries as the Base for 101 . 102 . 104 104 . 105 105 . 107 .
