World Bank injects additional US$80m into Ethiopia’s Agricultural Growth Project II

ETHIOPIA – Ethiopia has received US$80 million grant from World Bank’s fund, International Development Association (IDA) to bolster agricultural productivity and enhance market access for smallholder farmers.

IDA provides grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives.

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According to the World Bank the funding will be injected into the second Agricultural Growth Project (AGPII) which was approved in 2015 and expected to close in 2022, aimed to further increase the economic potential of Ethiopia’s agricultural sector.

“AGPII has made notable contributions to poverty reduction in Ethiopia. The project has been delivering solid results on the ground, especially in increasing productivity and enhancing commercialization,” said Vikas Choudhary, Senior Agricultural Specialist at the World Bank.

AGPII promotes the use of irrigation, enabling farmers to harvest two or three crops in a year; as opposed to a single crop under rainfed conditions, and diversify from cereals to high value horticulture and nutritious crops.

The program has also helped to increase access to agricultural services for nearly 1.4 million smallholder farmers (37% women). It has also successfully promoted over 254 new agricultural technologies with significant impact on crop productivity as well as climate-smart interventions.

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Additionally, the project has been instrumental in helping farmers adapt to climate change by completing 2,629 new small-scale irrigation schemes and upgrading existing irrigation infrastructure, which made possible the irrigation of 23,290 hectares of agricultural land.

The market infrastructure and value chain investments made under the project have been critical for connecting farmers with markets and enhancing commercialization.

These activities have resulted in substantial increases in yield per hectare and raised farmers’ incomes. They have also led to enhanced nutritional outcomes for farmers.

“AGPII has made notable contributions to poverty reduction in Ethiopia. The project has been delivering solid results on the ground, especially in increasing productivity and enhancing commercialization.”

Vikas Choudhary – Senior Agricultural Specialist at the World Bank.

“While encouraging results have been achieved so far, more work is needed to address remaining challenges and accelerate productivity gains, reduce exposure to erratic climatic conditions, decrease land degradation and enhance the natural resource base on which the sector depends,” said Ousmane Dione, World Bank Country Director for Eritrea, Ethiopia, South Sudan and Sudan.

This additional financing will help to address these challenges and is key to ensuring that Ethiopia’s agricultural sector reaches its full potential.

The funds will go towards scaling up results achieved so far and enhancing the technical design of various activities.

Furthermore, the funds will fill the unanticipated financing gaps created by high inflation and accelerate the implementation of project activities that have been delayed due to significant cost-over run.

AGPII is implemented in 167 woredas (districts) in Amhara, Oromia, SNNPR, Tigray, Benishangul-Gumuz, Gambella and Harari regional states as well as Dire Dawa city administration.

The project will directly benefit 1.6 million smallholder farmers, who live in areas with the highest potential for agricultural growth.

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