National Seminar on Agricultural Mechanization and Commercial Agriculture

A joint seminar on agricultural mechanization and commercial agriculture was organized by the Policy Study Institute (PSI) and Japan International Cooperation Agency (JICA) to deliberate on international and national experiences as an input for Ethiopian policy makers. The seminar was held on March 25, 2019 at Best Western Hotel, Addis Ababa. As mechanization, and in recent years commercial farming have become one of the priorities of the Ethiopia agricultural transformation agenda of Ethiopia, the seminar saw high level attendance, by among others, HE Mr. Daisuke Matsunaga – Japanese Ambassador to Ethiopia, PSI Director – Ato Ahmed Abetew, MoA Director General – Ato Germame Garuma – Amhara Bureau of Agriculture Head, Dr Bosena Tegegn and Dr Bart Minton from IFPRI and Dr Irene Koomen from BENEFIT Partnership, WUR.

The first presentation by Prof Keijiro Otsuka of Kobe University, Japan focused on mechanization for smallholder farmers. Prof Otsuka key messages included (i) it is more costly to use large scale machines than using small-scale machines; (ii) in spite of increase in cost of production, mechanizations does not increase productivity significantly; and (iii) labour saving due to use of large scale machines implies significant job loss. Accordingly, he argued that large scale mechanization in low income countries is a mistake and recommended being careful with large scale mechanization programmes within the context of a country transitioning for low to middle income. Mechanization options have to be context and locality specific. Farm size is also an important indicator for the success or failure of mechanization, where there is inverse relationship between farm size and productivity levels (yield /ha). In other words, small family farms are more efficient that large farms based on hired labour.

The second presentation by Dr. Tadesse Kuma of PSI focused on status of large and medium scale commercial farming in Ethiopia. The main messages of Dr Tadesse were that the overall performance of current licenced commercial farming and those under implementation is very low resulting in abundance of un-utilized fertile land that could have been used by smallholders. Those under implementation are utilizing a small proportion of land allocated. The key reasons for poor performance of the commercial farming sector was reported to be (i) poor initial assessment about the relevance in terms of experience and capacity to run commercial farms; (ii) limited follow up and support by relevant public authorities to the licenced commercial farms; and (iii) poor technical and financial capacity of commercial farms in farming.

The Ethiopian government’s intention to promote commercial farming was (i) to ensure knowledge and technology transfer to the surrounding smallholder farmers; (ii) to boost the availability of required raw materials for the emerging agro-industry sector; (iii) to enhance foreign currency earnings through promoting agricultural export; and (iv) to create rural job opportunities.

The discussions following the presentations reassured (i) the need to be context specific in promoting agricultural mechanizations; (ii) mechanization related activities to be market driven; and (iii) the need to revisit the approaches being followed to promote commercial farming in the country

The seminar was relevant to better understand the different strategic options of promoting agricultural mechanization in Ethiopia based on the experiences in several countries as it informs ongoing discussions and efforts made by BENEFIT in facilitation of improved mechanization for both smallholder farmers and commercial farms.

Contribution by BENEFIT PCU

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