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Ethiopia Value Chain Roadmap for Pulses 2016-2020

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Ethiopia Value Chain Roadmap for Pulses 2016-2020 ETHIOPIA VALUE CHAIN ROADMAP FOR PULSES 2016-2020 ETHIOPIA VALUE CHAIN ROADMAP FOR PULSES ETHIOPIA VALUE CHAIN ROADMAP FOR PULSES This value chain roadmap was developed on the basis of the process, methodology and technical assistance of the International Trade Centre (ITC) within the framework of its Trade Development Strategy programme. ITC is the joint agency of the World Trade Organization and the United Nations. As part of the ITC mandate of fostering sustainable development through increased trade opportunities, the Trade Development Strategy programme offers a suite of trade-related strategy solutions to maximize the development payoffs from trade. ITC-facilitated trade development strategies and roadmaps are oriented to the trade objectives of a country or region and can be tailored to high-level economic goals, specific development targets or particular sectors, allowing policy makers to choose their preferred level of engagement. The views expressed herein do not reflect the official opinion of ITC. Mention of firms, products and product brands does not imply the endorsement of ITC. This document has not been formally edited by ITC. The International Trade Centre ( ITC ) Street address : ITC, 54-56, rue de Montbrillant, 1202 Geneva, Switzerland Postal address : ITC Palais des Nations 1211 Geneva, Switzerland Telephone : + 41- 22 730 0111 Postal address : ITC, Palais des Nations, 1211 Geneva, Switzerland Email : [email protected] Internet : http :// www.intracen.org Layout: Jesús Alés – www.sputnix.es v ACKNOWLEDGMENTS The value chain roadmap was elaborated as a component of ITC’s Supporting India’s Trade and Investment project ( SITA ), a South-South trade and investment initiative that aims to improve the competitiveness of select value chains through the provisions of partnerships from institutions and business from India. SITA is funded by the U.K. Department of International Development ( DFID ). The formulation of the value chain roadmap was led by the Government with the technical assistance of the International Trade Centre ( ITC ). This document repre- sents the ambitions of the private and public sector stakeholders for the develop- ment of the sector. Stakeholders’ commitment and comprehensive collaboration have helped build consensus around a common vision that reflects the realities and limitations of the private sector, as well as policymakers and trade-related institutions. The document benefited particularly from the inputs and guidance provided by the members of the sector team : Genzeb Akele Kassahun Bekele Eyerusalem Regassa Ahmed M. Mukred K .P.C. R ao Technical support and guidance from International Trade Centre ( ITC ) was rendered through Alberto Amurgo Pacheco, Anna Victoria Quiñones Barr, Aman Goel, and Bharat Kulkarni. Assefa Yohannes provided valuable support as national consultant. vi CONTENTS Acknowledgments v EXECUTIVE SUMMARY XIV GLOBAL TRENDS IN PULSES 19 Global production of pulses 19 Global trade in pulses 20 Top markets for pulses 23 PULSES IN ETHIOPIA 25 VALUE CHAIN ANALYSIS 25 STRATEGIC ISSUES AND COMPETITIVE CONSTRAINTS 31 Supply-side issues 31 Business environment constraints 33 Market entry constraints 34 Socioeconomic and developmental constraints 36 STRATEGIC IMPLICATIONS FOR THE VALUE CHAIN ROADMAP 37 THE WAY FORWARD 40 THE STRATEGIC OBJECTIVES 40 THE VALUE CHAIN ROADMAP FOR THE NEXT FIVE YEARS 44 FDI AND SOUTH–SOUTH COOPERATION 45 The Ethiopian business environment for the pulses sector 48 FUTURE VALUE CHAIN 50 MOVING TO ACTION 52 ROADMAP PLAN OF ACTION 53 APPENDICES 65 Appendix I : Ethiopia’s production of pulses 66 Government policy 66 Scope of the pulse sector 66 vii Employment 67 Pulse market 68 Planting and harvesting season 68 Planting regions 69 Production 69 Appendix II : Ethiopia’s exports of pulses 75 Export partners 75 Export products 78 Appendix III : Policy environment and trade agreements 80 Agricultural policy 80 Industrial policies 82 Trade policy 83 Development policies 85 Appendix IV : Sector development targets 86 Appendix VIII : List of participants at consultations 92 References 94 viii FIGURES Figure 1 : The logical framework of the roadmap xvi Figure 2 : World import basked of pulses ( US $ thousands ) 20 Figure 3 : Imports by pulse category and leading importing region ( US $ thousands ) 21 Figure 4 : Exports of pulses by region or regional group, 2004–2013 ( US $ thousands ) 22 Figure 5 : Value chain of the pulses sector in Ethiopia 26 Figure 6 : Key determinants for a vision for the pulses sector 40 Figure 7 : The logical framework of the roadmap 44 Figure 8 : The future pulses value chain 50 Figure 9 : Ethiopia’s pulse area–production metric 1993–2013 70 Figure 10 : Ethiopia’s pulse production metric 1993–2013 70 Figure 11 : Ethiopia’s pulse area harvested metric 1993–2013 71 Figure 12 : Ethiopia’s pulse yields metric 1993–2013 71 Figure 13 : Yield of ‘Beans, dry’ : world-leading top three and top six African countries 2000–2013 73 Figure 14 : Ethiopia’s pulse exports 2001–2014 75 Figure 15 : Ethiopia’s top 20 markets for pulses, 2009 and 2014 ( US $ thousands ) 76 Figure 16 : Ethiopia’s exports of pulses by region or regional group, 2001–2013 ( US $ thousands ) 77 Figure 17 : Ethiopia’s export basket of pulses, 2001–2014 ( US $ thousands ) 78 Figure 18 : Ethiopian exports a share of world exports 2001–2014 ( % ) 79 Figure 19 : Geographical distribution for tariffs applied 89 Figure 20 : Comparative yields 2012 ( hectograms / ha ) 90 ix TABLES Table 1 : World-leading exporters of pulses, market share >=1 % ( US $ thousands ) 22 Table 2 : World-leading importers of pulses, average for 2012–2013 >= US $ 100 million ( US $ thousands ) 24 Table 3 : Value chain segments needing FDI and likely sources 47 Table 4 : The investment climate in Ethiopia and possible competitors for pulse investment 48 Table 5 : Comparison of costs and competitive factors 49 Table 6 : Number of private holders of temporary crops by size of holding during the Meher season 67 Table 7 : Pulses : estimates of improved seeds, irrigation, and areas that applied pesticides and fertilizer ( private holdings, Meher season ) 2008 / 09–2011 / 12 72 Table 8 : Regions share in total production by pulse variety ( 2014 / 15, Meher season ) 74 Table 9 : Ethiopia’s top 20 markets for pulses 76 Table 10 : Ethiopia’s pulses export growth 2009 / 10–2013 / 14 86 Table 11 : Countries granting preferential schemes to least developed countries 88 Table 12 : Pulse varieties’ and regions’ share in total pulses production ( 2014 / 015, Meher season ) 90 Table 13 : Estimates on improved seed, irrigation, pesticide and fertilizer applied area by pulse variety ( private holdings, Meher season ), 2008 / 09–2011 / 12 91 x ACRONYMS The following abbreviations are used : ADLI Agricultural Development Led GSP Generalized Scheme of Preferences Industrialization GTP Growth and Transformation Plan AGOA African Growth and Opportunity Act ha Hectares ATA Ethiopian Agricultural Transformation ICRISAT International Crops Research Institute Agency for the Semi-Arid Tropics BoA Bureau of Agriculture IPM Integrated Pest Management CAGR Compound Annual Growth Rate ITC International Trade Centre COMESA Common Market for Eastern and Southern MFN Most Favoured Nation Africa MoA Ministry of Agriculture CRGE Ethiopian Climate Resilient Green Economy PASDEP Plan for Accelerated and Sustainable ECX Ethiopian Commodity Exchange Development to End Poverty EGTE Ethiopian Grain Trade Enterprise PoA Plan of Action EIAR Ethiopian Institute of Agricultural Research RARI Regional Agricultural Research Institute ENAO Ethiopian National Accreditation Office SITA Supporting Indian Trade and Investment EPOSPEA Ethiopian Pulses, Oilseeds and Spices in Africa Processors-Exporters Association SNNPR Southern Nations, Nationalities, ESE Ethiopian Seed Enterprise and Peoples’ Region EU European Union SNV Netherlands Development Organization FAO Food and Agricultural Organization TL III Tropical Legumes III project of the United Nations USAID United States Agency for International FCA Federal Cooperative Agency Development FDI Foreign Direct Investment WEF World Economic Forum GCC Gulf Cooperation Council WTO World Trade Organization GDP Gross Domestic Product xi FOREWORD MR. AYANA ZEWDIE STATE MINISTER, ETHIOPIA MINISTRY OF TRADE The Ministry of Trade of the Federal Democratic Republic of Ethiopia is pleased to welcome the Value Chain Roadmap for the development of Pulses sector in Ethiopia. This Roadmap has been developed with technical assistance from the International Trade Centre ( ITC ) as part of their Supporting Indian Trade and Investment for Africa ( SITA ) project – the first South-South Aid-for-Trade project funded by the United Kingdom’s Department for International Development (. DFID ) This document follows comprehensive sector-wide consultations that guided its designed. The Strategy will contribute to facilitate productivity, improve the quality and the effective promotion of the Pulses sector in the country. We believe that this Pulses Roadmap, will not only offer us guidelines on the best way forward but is of vital importance for Ethiopia as it comes at a time when the country is launching its second growth and transformation plan ( GTP II ). I also take this opportunity to thank the ITC-DFID association in taking up the initiative, as well as all stakeholders who have contributed to the creation of this document. Through your continued support and commitment. xii FOREWORD MR. HAILE BERHE PRESIDENT OF THE ETHIOPIAN
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