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Ethiopia Country Report Tenna Shitarek, May 2012

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Ethiopia Country Report Tenna Shitarek, May 2012 Ethiopia Country Report Tenna Shitarek, May 2012 1 Ethiopia 1.1 Country Context With a population of over 80 million, Ethiopia is the second most populous country in sub-Saharan Africa (SSA). Though Ethiopia’s economy has been growing at an average rate of 7% in recent years1, the country remains one of the world’s poorest. With a low human development index of 0.383, Ethiopia is ranked 174 out of 187 countries in the UNDP’s Human Development report of 2011.2 The average Gross National Income (GNI) per capita is only US$971, which is far below the average value for sub-Saharan African countries of $1,966.3 The purchasing power of rural households remains weak with almost 40% of the rural population living in poverty, and about 29% of the population living in extreme poverty with an income of less than one dollar per capita per day. Ethiopia’s economy is based mainly on agriculture, including crop and livestock production, which contributes 45% of the national Gross Domestic Product (GDP), more than 80% of employment opportunities and over 90% of the foreign exchange earnings of the country.4 However, the Ethiopian economy, particularly agricultural development, is extremely vulnerable to external shocks like climate change, global price fluctuations of exports and imports and other external factors. Ethiopia's climate is tropical in the south-east and north-east lowland areas, and cooler in the highland region located in the central part of the country. Over the past several decades, temperatures in Ethiopia have increased by 1.3°C per decade, and daily average temperature records indicate significantly increasing trends in the number of hot days and hot nights.5 A recent survey conducted in Ethiopia indicated that a significant proportion of the population is experiencing changes in the type and severity of climate shocks as well as more variable rainfall. These changes in climate condition 1 www.oecd.org/dev/publications/africanoutlook; 2UNDP, 2011 3UNDP, 2011 4MoA, 2010 5McSweeney, 2009 1 have negatively impacted the population by contributing to asset losses through natural resource degradation and decreases in livestock assets. Drought is one of the most probable climate shocks, regularly affecting food production, livestock production and livelihoods of the poor. Since the 1970s, the severity, frequency and impacts of drought have increased and the areas affected by drought and desertification are Livestock Population in Pastoralist Areas expanding.6 Between 1974 and 2003, Ethiopia reportedly experienced about 54 natural disasters, with the worst famine the country has experienced in 1983-5. During this period, the number of affected people increased from nearly 2 million (between 1974 and 1978) to about 42 million (during 1999- 2003).7 Oxfam estimates that drought alone costs Ethiopia US$1.1 billion per year.8 Oxfam further states that this loss ‘almost eclipses the US$1.3 billion per year that Ethiopia received in international assistance to tackle poverty and emergencies over the same period’.9 As described earlier, the economy of Ethiopia relies heavily on agriculture, which is very vulnerable to climate shock as it is the largest user of fresh water in Ethiopia. Farmers and pastoralists living in semi-arid and arid lowlands are heavily reliant on rain-fed agriculture and livestock rearing. Thus, when water is scarce due to drought or erratic rainfall, crops face greater risks of failing, more livestock resources perish, and pastoralists and farmers have to travel greater distances to access water for their households and animals. For instance, during the 2002-2003 drought, Ethiopia lost more than 1.4 million animals.10 6 World Bank, 2009 7 MoWR, 2007 8 Save the Children and Oxfam, 2012 9 Oxfam, 2011 10FAO, 2003 cited in ICRC, 2005 2 Animal National Pastoral as % of Species (Millions)* areas National (Millions ) figure Cattle 52 15.60 30% Sheep 3.3 0.99 30% Goats 30 21.00 70% Camels 2.5 2.50 100% Horses 1.58 Asses 3.89 Total 87.8 45.56 Head count (Sources: * MoA, 2010; ** HPG, 2008:6) 3 1.2 Pastoralism Pastoralists in Ethiopia are found in seven regions including Afar, Somali, SNNP, Oromia, Diredawa, Benshangul Gumuz and Gambella Regional States. The main livelihood systems include pastoralism, farming and ex-pastoralism – those who have dropped out of pastoralism and now survive on petty income-earning activities.11 Pastoralists constitute a minority in Ethiopia, with an estimated 12–15 million people (14% to 18%) out of the total population of 83 million people.12 Ethiopia’s total livestock population has reached more than 88 million in head count, and is the largest in Africa.13 The livestock sub-sector contributes an estimated 12% to total GDP and over 45% to agricultural GDP.14 On average, the pastoral livestock population accounts for an estimated 40% of the total livestock population of the country.15 IGAD estimated in 2010 that pastoralist livestock makes up 30% of the nation’s cattle, 70% of the goats and sheep and all camels in the country.16 The pastoral population occupies a disproportionately large area of Ethiopia and produces much more than its share of national livestock output. The Ministry of Agriculture estimates that pastoralists use 60% of the country’s land area,17 though exact figures of the pastoral livestock population in Ethiopia are unknown. In 2010, IGAD commented that the contribution of pastoral livestock to the national GDP had been underestimated in previous years. However, according to a revised formula to value livestock assets to the national economy, IGAD estimated that pastoralist livestock contributed 35 billion Ethiopian Birr (ETB)18 out of the total national livestock value of 86.5 billion ETB to the national economy for 2008/09.19 In some cases, pastoral animals can also have an additional collective insurance value depending on how many animals are involved in livestock sharing schemes to pool risk. 11 Behnke et al., 2007 12 PFE, 2006 13 MoA, 2010 14 Ibid 15 Pantuliano and Wekesa, 2008 16 PFE (2010) indicated that pastoralist regions contribute 20% of sheep, 25% of goats, 73% of cattle and 100% of the camel population of the country. (PFE, 2010) (PADS Vol. 2, Study 5 Animal Breeds) 17 MoARD, 2005 18 This was derived from cattle (20.258 billion ETB), sheep (2.254 billion ETB), goats (5.011 billion ETB) and camels (7.256 billion ETB). 19 IGAD, 2010 4 It is estimated that about 10.5% of pastoral animals are involved in livestock sharing networks.20 By using this figure and IGAD’s estimate that pastoralist livestock contributes 35 billion ETB to the national economy, the collective insurance value of pastoral herds can be estimated at 3.7 billion ETB in 2008-2009. The pastoral livestock population also contributes to transport services and provides products such as milk, meat, skin and hides, though the value of these components has largely been underestimated.21For instance, IGAD notes that the estimate of 51,692,400 ETB as the gross value of animal transport services in 2008-2009 was largely underestimated due to a lack of proper recording and methods of calculating the transportation services provided by equines and pack animals in pastoralist areas. This indicates that the contribution of pastoral livestock to Ethiopia’s GDP is very significant and exceeds 90 billion ETB, approximately US$10.6 billion.22 Drought routinely affects pastoral areas. There are differing views as to why pastoralists in the Horn of Africa have become more vulnerable to the effects of drought. In 1988, Ellis and Swift suggested that East African pastoral systems have vegetation and livestock populations that are largely controlled by rainfall. They associated increases in livestock population with high precipitation, and a decline in the population due to decreasing access to vegetation and water resulting from low rainfall. According to these researchers, the livestock numbers in such systems change mostly in response to annual rainfall variation, which has a direct effect on availability of vegetation and water for livestock. Based on their work in the semi-arid Borana Plateau, however, PARIMA researchers argue that it is not only the annual rainfall that controls the livestock population in a given arid or semi-arid pastoralist area, but also the interaction between the livestock population density and forage resources that affects the livestock population in a given drought-year.23 By analysing the relationship between the livestock population density and the forage resources, herd pattern, and the consequences of drought over the past three decades (1980-2007), Desta and Coppock noted that livestock crashes in Borana appeared to be predictable. They seemed to suggest that livestock die off due to drought is likely to happen when the livestock density exceeds a certain threshold.24 20 Barrett et al (2006) and McPeak et al (forthcoming 2011) as cited in IGAD (2010) 21 Ibid. 22 At 1US$=8.51 ETB in 2008/09 Exchange rate 23 Desta and Coppock (2002) 24 They suggest that ‘when stocking rates exceed a threshold size (over 30 head of cattle per square kilometre, for example), a major die off becomes more likely when the annual rainfall happens to be low (for example, less than 400 millimetres per year)’. Ibid. 5 Whatever the case may be, it is evident that more and more pastoralist households, especially the poorer households, are increasingly affected by severe drought, which occurs approximately every 3 to 5 years.25 25Aklilu and Catley,2010 6 2 Cost Comparison of Response 2.1 Top-down Analysis 2.1.1 What is the Cost of Humanitarian Response? Cost of humanitarian aid Over the years, multiple bilateral and multilateral donors have responded to the humanitarian needs of an affected population.
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