The Reporter | 26 May 2012

By Wudineh Zenebe

Following up on its recent assessment of the large commercial farming subsector operation in Ethiopia, the Ministry of Agriculture (MoA) announced that it has learned that some of the companies which acquired large chunks of agricultural land are not progressing in accordance with their contractual agreement. According to the evaluation that the ministry did in the past few weeks, some of the large-scale land acquisitions in Ethiopia are not performing as expected in implementing their projects. In fact, some have done nothing more than fencing their plots, the ministry noted, and these companies would definitely face stronger measures.      

The ministry started evaluating the performance by investors who acquired large tracts of land to undertake commercial farming projects. According to the ministry, those investors who have low performance and are not functioning according to the agreement that they have signed will face stronger measures, disclosed Tarekegn Tsige, communication affairs directorate director of the ministry.

Since a couple of months ago, the ministry has temporarily suspended giving land to investors for a known period of time. Following that the ministry had assigned its officers to conduct the evaluation. The officers have been evaluating the performance of the projects in Gambella and Benishangul-Gumuz. However, though the report of the evaluation has not yet been completed, sources disclosed that many of the investors from those places have not yet started their operations in line with the contractual agreements they had signed with the ministry.

It has been three years since the ministry was delegated by the regions to allot land for large-scale investment purpose and this is its first round of evaluation. It was learnt that some investors who had taken vast tracts of land beyond their capacity had left these properties fenced off and idle. And some of these investors might be forced to return all or part of the possession.

Some 11,773 local and foreign investors took licenses to invest on large-scale agriculture worth some 132 billion birr capital. Among the licensed investors, 5,284 have started operation, 126 of them being foreign investors.    

The total size of land that has been given to investors is 2.2 million hectares and some 567,651 hectares out of the total given land is owned by foreign investors.