Revamping Agricultural and Rural Credit and Insurance Services to Transform Ethiopian Food Systems, 2024
Everyone agrees that Ethiopia must modernize and transform its food systems at speed and scale. T... more Everyone agrees that Ethiopia must modernize and transform its food systems at speed and scale. The urgency of this task becomes particularly relevant in the face of population growth, the youth bulge, and environmental degradation, further compounded by climate change and the rising middle-class population, which consequently demands nutrient-dense foods. The core question for Ethiopia is how and what to do to modernize and transform traditional agriculture and improve the quality of life of the rural population.
No country has ever developed its agricultural and rural economy without a steadfast commitment and substantial public sector finance. This financial support is crucial for facilitating mechanization, technical adoption, investment in agriculture and rural economy, and sustained improvements in the quality of life for everyone. The aspiration to transform agriculture and the rural economy can only be realized with improved access to capital, purchasing inputs and aggregate land, investing in irrigation infrastructure, adopting farm mechanization, engaging in microeconomic transformation in rural areas, and protecting against agricultural risk. Protecting the investment in the agricultural sector through agricultural risk insurance is paramount and an essential prerequisite for public and private investment.
The study recommends i) establishing a public sector bank dedicated to providing micro-credit to smallholder agriculture and rural enterprises; ii) Ethiopia must develop a legal instrument for operationalizing agricultural insurance, with the public and private sectors playing complementary roles; iii) it is imperative that MOA organizes itself and promptly establishes an agro-finance coordinating and implementation unit. This step is crucial for effectively implementing and coordinating agricultural insurance and agricultural credit programs, and iv) MOA must bring together private and public sector institutions that have an immediate and direct interest in agricultural micro-credit and micro-risk insurance arrangements. Agricultural credit and insurance services cut across many institutions, requiring a multistakeholder consultative working group. An equally crucial matter concerns the structure, design, targeting, and implementation of agricultural financial systems to ensure the effectiveness of agricultural credit and insurance programs. Properly structured credit programs and agricultural risk insurance can significantly enhance farmers’ access to financial services, which collectively will contribute to the transformation of the traditional agricultural sector.
The Evolving Question of Land in Ethiopia: Tenure Preferences, Property Rights and Land Governance, 2022
Ethiopia faces major political and economic difficulties, expressed in massive shortfalls in dome... more Ethiopia faces major political and economic difficulties, expressed in massive shortfalls in domestic food supply, food imports that swell continuously to meet national demand, and resulting trade deficits and pressure on the national accounts. Population pressure is associated with high unemployment, particularly among the youth, farm decapitalization, and a vicious cycle of poverty and food insecurity. These are not insurmountable challenges if Ethiopia could only stimulate its currently dead land assets into an active source of capital for national development.
Land as a political-economy agent is a source of economic and political power, and essential to the survival and viability of the agricultural population (smallholder farming households) and of the Ethiopian people as a whole. However, land in Ethiopia carries historical baggage which provokes fresh memories of the 1974 revolution. This resulted in the 1975 land reform, codified in the 1995 federal constitution, which placed land as the public property of the Ethiopian people. It is all too obvious to perceive land tenure discussions as a political tinderbox, and it is not impossible to appreciate the reticence of some political authorities and policy-makers in resisting reform. As a result, land problems have accumulated over the decades and now surpass the limits of tolerance in terms of food insecurity, environmental degradation, and land scarcity; land issues are also now shaping national political contestation and conflict.
Land tenure, which is the question of ‘who owns the land’ or ‘who uses the land’, is in part philosophical (that land is a gift of nature), in part a question of property rights (the right of every citizen to own property protected by law), and in part a question of development (land being one of the factors of production that constitutes the very foundation of social and economic development). Regardless of the perception of its ownership or use, or how long it is owned (indefinite for private or definite for public ownership), all land tenure regimes are governed by the same property rights and land administration principles.
The argument of this paper is that Ethiopia’s national development in the 21st century and the transformation of its food system rest on three priority pillars of land reform: a) close the sterile land tenure preference debate, i.e., private vs public ownership; b) activate and enshrine property rights provisions for all Ethiopians; and, c) put in place an integrated land administration and governance system. These three pillars are inseparable and interdependent. Managed well, these land reform priorities could be sources of capital formation and food system transformation that will free millions from poverty and food insecurity and put Ethiopia on the path of inclusive national development. Managed poorly or inadequately, the land question will be a source of massive poverty and interminable conflict on the national political landscape.
The author is the Coordinator, Hand-over and Partnership Branch at the World Food Programme. The ... more The author is the Coordinator, Hand-over and Partnership Branch at the World Food Programme. The author is responsible for the choice and the presentation of the facts contained in this publication and for the opinions expressed herein, which are not ...
Revamping Agricultural and Rural Credit and Insurance Services to Transform Ethiopian Food Systems, 2024
Everyone agrees that Ethiopia must modernize and transform its food systems at speed and scale. T... more Everyone agrees that Ethiopia must modernize and transform its food systems at speed and scale. The urgency of this task becomes particularly relevant in the face of population growth, the youth bulge, and environmental degradation, further compounded by climate change and the rising middle-class population, which consequently demands nutrient-dense foods. The core question for Ethiopia is how and what to do to modernize and transform traditional agriculture and improve the quality of life of the rural population.
No country has ever developed its agricultural and rural economy without a steadfast commitment and substantial public sector finance. This financial support is crucial for facilitating mechanization, technical adoption, investment in agriculture and rural economy, and sustained improvements in the quality of life for everyone. The aspiration to transform agriculture and the rural economy can only be realized with improved access to capital, purchasing inputs and aggregate land, investing in irrigation infrastructure, adopting farm mechanization, engaging in microeconomic transformation in rural areas, and protecting against agricultural risk. Protecting the investment in the agricultural sector through agricultural risk insurance is paramount and an essential prerequisite for public and private investment.
The study recommends i) establishing a public sector bank dedicated to providing micro-credit to smallholder agriculture and rural enterprises; ii) Ethiopia must develop a legal instrument for operationalizing agricultural insurance, with the public and private sectors playing complementary roles; iii) it is imperative that MOA organizes itself and promptly establishes an agro-finance coordinating and implementation unit. This step is crucial for effectively implementing and coordinating agricultural insurance and agricultural credit programs, and iv) MOA must bring together private and public sector institutions that have an immediate and direct interest in agricultural micro-credit and micro-risk insurance arrangements. Agricultural credit and insurance services cut across many institutions, requiring a multistakeholder consultative working group. An equally crucial matter concerns the structure, design, targeting, and implementation of agricultural financial systems to ensure the effectiveness of agricultural credit and insurance programs. Properly structured credit programs and agricultural risk insurance can significantly enhance farmers’ access to financial services, which collectively will contribute to the transformation of the traditional agricultural sector.
The Evolving Question of Land in Ethiopia: Tenure Preferences, Property Rights and Land Governance, 2022
Ethiopia faces major political and economic difficulties, expressed in massive shortfalls in dome... more Ethiopia faces major political and economic difficulties, expressed in massive shortfalls in domestic food supply, food imports that swell continuously to meet national demand, and resulting trade deficits and pressure on the national accounts. Population pressure is associated with high unemployment, particularly among the youth, farm decapitalization, and a vicious cycle of poverty and food insecurity. These are not insurmountable challenges if Ethiopia could only stimulate its currently dead land assets into an active source of capital for national development.
Land as a political-economy agent is a source of economic and political power, and essential to the survival and viability of the agricultural population (smallholder farming households) and of the Ethiopian people as a whole. However, land in Ethiopia carries historical baggage which provokes fresh memories of the 1974 revolution. This resulted in the 1975 land reform, codified in the 1995 federal constitution, which placed land as the public property of the Ethiopian people. It is all too obvious to perceive land tenure discussions as a political tinderbox, and it is not impossible to appreciate the reticence of some political authorities and policy-makers in resisting reform. As a result, land problems have accumulated over the decades and now surpass the limits of tolerance in terms of food insecurity, environmental degradation, and land scarcity; land issues are also now shaping national political contestation and conflict.
Land tenure, which is the question of ‘who owns the land’ or ‘who uses the land’, is in part philosophical (that land is a gift of nature), in part a question of property rights (the right of every citizen to own property protected by law), and in part a question of development (land being one of the factors of production that constitutes the very foundation of social and economic development). Regardless of the perception of its ownership or use, or how long it is owned (indefinite for private or definite for public ownership), all land tenure regimes are governed by the same property rights and land administration principles.
The argument of this paper is that Ethiopia’s national development in the 21st century and the transformation of its food system rest on three priority pillars of land reform: a) close the sterile land tenure preference debate, i.e., private vs public ownership; b) activate and enshrine property rights provisions for all Ethiopians; and, c) put in place an integrated land administration and governance system. These three pillars are inseparable and interdependent. Managed well, these land reform priorities could be sources of capital formation and food system transformation that will free millions from poverty and food insecurity and put Ethiopia on the path of inclusive national development. Managed poorly or inadequately, the land question will be a source of massive poverty and interminable conflict on the national political landscape.
The author is the Coordinator, Hand-over and Partnership Branch at the World Food Programme. The ... more The author is the Coordinator, Hand-over and Partnership Branch at the World Food Programme. The author is responsible for the choice and the presentation of the facts contained in this publication and for the opinions expressed herein, which are not ...
Uploads
Papers by Getachew Diriba
No country has ever developed its agricultural and rural economy without a steadfast commitment and substantial public sector finance. This financial support is crucial for facilitating mechanization, technical adoption, investment in agriculture and rural economy, and sustained improvements in the quality of life for everyone. The aspiration to transform agriculture and the rural economy can only be realized with improved access to capital, purchasing inputs and aggregate land, investing in irrigation infrastructure, adopting farm mechanization, engaging in microeconomic transformation in rural areas, and protecting against agricultural risk. Protecting the investment in the agricultural sector through agricultural risk insurance is paramount and an essential prerequisite for public and private investment.
The study recommends i) establishing a public sector bank dedicated to providing micro-credit to smallholder agriculture and rural enterprises; ii) Ethiopia must develop a legal instrument for operationalizing agricultural insurance, with the public and private sectors playing complementary roles; iii) it is imperative that MOA organizes itself and promptly establishes an agro-finance coordinating and implementation unit. This step is crucial for effectively implementing and coordinating agricultural insurance and agricultural credit programs, and iv) MOA must bring together private and public sector institutions that have an immediate and direct interest in agricultural micro-credit and micro-risk insurance arrangements. Agricultural credit and insurance services cut across many institutions, requiring a multistakeholder consultative working group. An equally crucial matter concerns the structure, design, targeting, and implementation of agricultural financial systems to ensure the effectiveness of agricultural credit and insurance programs. Properly structured credit programs and agricultural risk insurance can significantly enhance farmers’ access to financial services, which collectively will contribute to the transformation of the traditional agricultural sector.
Land as a political-economy agent is a source of economic and political power, and essential to the survival and viability of the agricultural population (smallholder farming households) and of the Ethiopian people as a whole. However, land in Ethiopia carries historical baggage which provokes fresh memories of the 1974 revolution. This resulted in the 1975 land reform, codified in the 1995 federal constitution, which placed land as the public property of the Ethiopian people. It is all too obvious to perceive land tenure discussions as a political tinderbox, and it is not impossible to appreciate the reticence of some political authorities and policy-makers in resisting reform. As a result, land problems have accumulated over the decades and now surpass the limits of tolerance in terms of food insecurity, environmental degradation, and land scarcity; land issues are also now shaping national political contestation and conflict.
Land tenure, which is the question of ‘who owns the land’ or ‘who uses the land’, is in part philosophical (that land is a gift of nature), in part a question of property rights (the right of every citizen to own property protected by law), and in part a question of development (land being one of the factors of production that constitutes the very foundation of social and economic development). Regardless of the perception of its ownership or use, or how long it is owned (indefinite for private or definite for public ownership), all land tenure regimes are governed by the same property rights and land administration principles.
The argument of this paper is that Ethiopia’s national development in the 21st century and the transformation of its food system rest on three priority pillars of land reform: a) close the sterile land tenure preference debate, i.e., private vs public ownership; b) activate and enshrine property rights provisions for all Ethiopians; and, c) put in place an integrated land administration and governance system. These three pillars are inseparable and interdependent. Managed well, these land reform priorities could be sources of capital formation and food system transformation that will free millions from poverty and food insecurity and put Ethiopia on the path of inclusive national development. Managed poorly or inadequately, the land question will be a source of massive poverty and interminable conflict on the national political landscape.
No country has ever developed its agricultural and rural economy without a steadfast commitment and substantial public sector finance. This financial support is crucial for facilitating mechanization, technical adoption, investment in agriculture and rural economy, and sustained improvements in the quality of life for everyone. The aspiration to transform agriculture and the rural economy can only be realized with improved access to capital, purchasing inputs and aggregate land, investing in irrigation infrastructure, adopting farm mechanization, engaging in microeconomic transformation in rural areas, and protecting against agricultural risk. Protecting the investment in the agricultural sector through agricultural risk insurance is paramount and an essential prerequisite for public and private investment.
The study recommends i) establishing a public sector bank dedicated to providing micro-credit to smallholder agriculture and rural enterprises; ii) Ethiopia must develop a legal instrument for operationalizing agricultural insurance, with the public and private sectors playing complementary roles; iii) it is imperative that MOA organizes itself and promptly establishes an agro-finance coordinating and implementation unit. This step is crucial for effectively implementing and coordinating agricultural insurance and agricultural credit programs, and iv) MOA must bring together private and public sector institutions that have an immediate and direct interest in agricultural micro-credit and micro-risk insurance arrangements. Agricultural credit and insurance services cut across many institutions, requiring a multistakeholder consultative working group. An equally crucial matter concerns the structure, design, targeting, and implementation of agricultural financial systems to ensure the effectiveness of agricultural credit and insurance programs. Properly structured credit programs and agricultural risk insurance can significantly enhance farmers’ access to financial services, which collectively will contribute to the transformation of the traditional agricultural sector.
Land as a political-economy agent is a source of economic and political power, and essential to the survival and viability of the agricultural population (smallholder farming households) and of the Ethiopian people as a whole. However, land in Ethiopia carries historical baggage which provokes fresh memories of the 1974 revolution. This resulted in the 1975 land reform, codified in the 1995 federal constitution, which placed land as the public property of the Ethiopian people. It is all too obvious to perceive land tenure discussions as a political tinderbox, and it is not impossible to appreciate the reticence of some political authorities and policy-makers in resisting reform. As a result, land problems have accumulated over the decades and now surpass the limits of tolerance in terms of food insecurity, environmental degradation, and land scarcity; land issues are also now shaping national political contestation and conflict.
Land tenure, which is the question of ‘who owns the land’ or ‘who uses the land’, is in part philosophical (that land is a gift of nature), in part a question of property rights (the right of every citizen to own property protected by law), and in part a question of development (land being one of the factors of production that constitutes the very foundation of social and economic development). Regardless of the perception of its ownership or use, or how long it is owned (indefinite for private or definite for public ownership), all land tenure regimes are governed by the same property rights and land administration principles.
The argument of this paper is that Ethiopia’s national development in the 21st century and the transformation of its food system rest on three priority pillars of land reform: a) close the sterile land tenure preference debate, i.e., private vs public ownership; b) activate and enshrine property rights provisions for all Ethiopians; and, c) put in place an integrated land administration and governance system. These three pillars are inseparable and interdependent. Managed well, these land reform priorities could be sources of capital formation and food system transformation that will free millions from poverty and food insecurity and put Ethiopia on the path of inclusive national development. Managed poorly or inadequately, the land question will be a source of massive poverty and interminable conflict on the national political landscape.