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Ethiopia: Improving Quality to Enhance Agricultural ExportThursday, June 22, 2017 > 09:26:25
The amount of agricultural export commodity revenue obtained at the international market is though varied item to item, meeting the international quality standard has remained the major hindrance not to break into and navigate the global markets, the Ministry of Trade said.
Presenting his Ministry's 11-month performance report to the House of Peoples' Representatives recently, Trade Minister Dr. Bekele Muladu said though vigorous efforts have been exerted to increase volume of agricultural exports and diversify commodities, desirable result has not yet gained.
According to the Minister, among the other challenges, shortcoming in meeting international quality standard has posed a major setback in efforts made to enhance the performance of agricultural exports.
The revenue obtained from commodities under the supervision of Ministry of Trade during the past 11 months, has shown a 4 percent decline from last year same period, it was stated.
The amount of revenue Ethiopia has been expecting to earn from export of coffee, sesame and other major exportable items has also been inconsistent due to quality gaps that hamper the country's opportunity to remain a strong competitor in the world agricultural market, he added.
The economic analyst, Dr. Fikru Deksisa agreed on the Minister's idea. He said lack of appropriate and modern technology in agricultural value chain is the major bottleneck in export quality.
Dr. Fikru noted that poor handling, packaging and storage techniques as well as insufficient transport connectivity also play an adverse role in reducing the value of Ethiopia's exportable commodities in the global market.
He said: "Despite Ethiopia's high soil fertility and amenability of its climate towards the cultivation of coffee, the aforementioned problems hinder our coffee's competitiveness in the world market and reduce its price compared to those coming from Brazil and Vietnam."
Cognizant the problem, the government has taken various measures including conducting commodity quality and safety inspection tests and providing technical support for stakeholders in the agriculture value chains, the Minister noted.
Dr. Bekele said: "Consultations had been held with farmers' cooperatives of the oil seed and cereal growing States and follow up mechanisms were also set with state governments to support smallholder farmers who supply the majority of exportable items. "
Representatives from the Ministry of Trade also had paid field visits in to various states aimed at enhancing the market chain among farmers, cooperatives and Ethiopian Commodity Exchange /ECX/.
Following the visit, they have identified shortcomings witnessed in commodity inspection, grading and storage services and provided the necessary support," he added.
It was stated that ECX warehouses have been expanded in cereal and oil seed growing areas to reduce the problem associated with poor storage facilities.
A data obtained from Ministry of Trade indicated that agriculture remains the dominant sector in Ethiopia's export performance by contributing 77.5% of the total 2.53 billion USD secured during the past 11 months of the current fiscal year followed by manufacturing and mining with 14.3 and 7.1 percent shares.
While coffee extends its hegemony in Ethiopia's export revenue by generating over 722.4 million USD during 2015/16 fiscal year, oil seeds and chat remain the second and fourth largest hard currency earning commodities with 472.6 and 262.4 million USD respectively.
The economic analyst Dr. Fikru said consolidated efforts needed to improve agricultural commodities quality that would enable Ethiopia to have a reliable market for its export and enhance the country's benefit from the sector.
Dr. Fikru stressed that the government should extend its leading role in facilitating conditions for smallholder farmers access to appropriate and modern farming technologies either individually or under farmers' cooperatives.
He said "The incumbent needs to provide capacity building trainings and prepare model plots to introduce smallholder farmers with modern technologies and bolster their understanding in a practical manner."
The economic analyst underscored a lot is also expected from development agents to train farmers and build their understanding in the link between improving export quality with increasing revenue.