National coffer

Newsletter 14

ETHIOPIA: HOME TO ORGANIC MEAT TRADE AND INVESTMENT OPPORTUNITIES IN LIVESTOCK AND MEAT INDUSTRY

Ethiopia has registered successive economic growth for the first time in its history over the last three years. The growth was attained mainly in agriculture, export trade, industry, construction and the service sector. The country registered an annual average growth rate ranging between 8.4 to 11 percent over the stated period.

The growth was attributed to conducive investment environment, appropriate development strategies and policies, stable political climate, abundant labour force as well as government commitment.

The meat processing industry is one of the industrial areas that have shown a significant growth in the last three years. The sub-sector was totally monopolized by the government

before 1991 and had no visible progress prior to the advent of the market economy. Currently, meat processing factories are now flourishing in Ethiopia and as a result export earning from the sector is on the rise. The country exported 3,317 tons of meat in 2003/2004 and earned 6,335,000 USD in revenues. The amount of meat exported and the foreign currency earned increased to 17.5 million USD the following year. Government has planned to export 30, 000 tones of meat annually.  

Product

Values Million ETB

Share %

Semi processed skin

               453.3

       56.1

Semi processed hides

                60.0

7.4

Leather and leather goods

                38.3

4.7

Sub-total

                551.6

68.2

Live animals, meat and other products

               257.6

31.8

Livestock total

               809.2

100.0

 Livestock and Livestock Products Export Values 2004/2005

The government has shown commitment to develop the sector through market infrastructure development, animal and public health delivery and quality control, efficient export service deliveries, liberalizing trade, foreign exchange control and payment modalities and facilitating export operators and producer's capacity building.

The major meat trade partner countries with Ethiopia include Saudi Arabia, Dubai, Egypt, Yemen, Congo Brazavil, Cote d'Ivoire and South Africa while major destinations for live animals from Ethiopia are Saudi Arabia, Dubai, Yemen and Egypt.

Incentive for those interested to invest in livestock industry include:

§         Enabling policy environment and attractive incentives including tax free imports of capital goods and income tax holidays,

§         Commitment of the government to promote and assist private sector investment in the livestock industry especially those focusing on export trade, 

§         Access to support service rendering organizations,

§         Availability of disciplined and hard working labour force,

§         High demand for products both in the region and the Middle East,

§         Proximity to the strategic export markets,

§         Resource availability,

§         Rinderpest-free zone

§         Availablity of export abattoirs that have the capacities for processing annually about 25 thousand tons of mostly chilled goat meat,

§         High demand for new abattoirs mainly for handling frozen and vacuum packed beef,

§         Willingness of the regional states to avail free land for investment in abattoirs particularly in pastoral and major livestock supply areas,

§         Free land allocation for abattoir construction and on-going construction of livestock holding areas in six major livestock supply shades.

With regard to lucrative investment, the following are some of the judicious sub sectors to invest in: Export abattoirs and meat processing, poultry, commercial livestock breeding and ranching, commercial dairy and milk processing, commercial forage production, feed processing poultry farm and meat dressing. The livestock resource is unexploited and renewable. So one could comfortably consider it as potential and rewarding investment sector.