Ethiopia Eyes Middle East Market for Agricultural Products

Last updated March 19, 2015

Addis Ababa March 11/2015 Ethiopia targets countries in the Middle East for its agricultural products and live animals export, the Ministry of Trade disclosed.

Saudi Arabia and United Arab Emirates (UAE) are the countries the government eyes for its export destinations, Yeshak Tekaligne, Director of Bilateral and Regional Trade Relation and Negotiation told ENA.

These countries are the largest destinations for Ethiopia’s agricultural products, with Saudi Arabia and UAE receive 35 and 17 percent of the country’s exports destined in the region respectively.

Live animals, coffee and sesame are among the major export items of Ethiopia to the region. Ethiopia has exported agricultural products worth at 11.45 billion USD to Saudi Arabia and UAE alone during the past four years.

Most of the countries in the region are highly dependent on imported agricultural products for food, mainly because of effect on the limited water resource and the cost of desalination.

Countries like Saudi Arabia are planning to stop growing wheat locally, and entirely rely on imports beginning from 2016, because of the pressure on water resources and a shift towards overseas food investment. Saudi Arabia imported 3 million tons food in 2014, which makes it the sixth largest wheat importer that same year.

The shift will benefit Africa in general and Ethiopia in particular, because of its potential and geographical proximity.

According to Yeshak, the government understands the high demand for food items in the region and working to increase export volume and items.

Besides its geographical proximity to the Middle East, Ethiopia’s high soil fertility and abundant water resources position the country among potential suppliers of food items and investment destination for Middle East companies.

The director noted that both the volume and amount of Ethiopia’s agricultural export to Middle East countries have shown steady progress in the past 5 years.

“Our export volume to the region has been growing from time to time. The export trade has shown a 14.7 percent annual growth in average during the past 5 years. … When we see the amount we exported to the Middle East in 2009, it was worth around 312 million USD. This number grew to 538 million USD in 2013.’’

The total revenue Ethiopia earned from agricultural products exported to Middle East countries in the past four years is 2.191 billon USD. Share of the Middle East countries in terms of Ethiopia’s export trade is 19.16 percent.

It was indicted while Asia has the lion’s share in Ethiopia’s import-export trade; Middle East countries also play a significant role in the country’s trade.

Yeshak said the government works to maximize its benefit from the export trade and bilateral trade agreements were inked with Middle East countries to facilitate trade ties.

In terms of agricultural items, coffee accounts for 9 percent, meat and sesame consist 5.51 and 5.19 percent respectively of the country’s total export to the region in the GTP period.

Ethiopia has captured the attention of Saudi investors owing to its high soil fertility, the amenability of its climate towards the cultivation of a diverse range of crops, and the comparative abundance of its water supply.

Middle East companies including Saudi Star Agricultural Development plc, owned by Saudi Tycoon Mohammed Hussein Al Amoudi, are investing in Ethiopia in the agriculture sector.

Five projects owned by companies from Saudi Arabia, UAE and Kuwait have licensed during the past four years.

– See more at: http://www.ena.gov.et/en/index.php/economy/item/494-ethiopia-eyes-middle-east-market-for-agricultural-products#sthash.Sm5pP1i4.dpuf

 

Source: ENA


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