Capital Ethiopia Newspaper

Ethiopia to charge more on commercial farm leases

Ethiopia, which leases large tracts of land at cheap rates for commercial farming, plans to improve infrastructure and access to farmland and charge a premium to investors, an official said.
The Horn of Africa country has allocated some 3.6 million hectares of land for firms seeking to invest in agriculture, often around remote and sparsely-populated regions in its west. Indian-listed Karuturi Global, which is farming rice and palm cereals on its 10,000 hectares plot in the Gambella province, is among the 32 companies that have snapped up land. Data on the Ministry of Agriculture website showed annual land rental rates for foreign firms ranging from $12.8 per hectare to just $1.15.“We plan to build infrastructure by investing in roads, phone lines and electricity in these designated areas to add value,” said EsayasKebede, head of the Ministry of Agriculture’s Agricultural Investment Agency. “Companies often leased land for 20 to 40 years on certain prices per hectare, but the times will be reduced and the prices will increase upon completion (of infrastructure projects),” he said. Around 400 companies submit applications for licenses each month, Esayas said, with a growing number of them from Europe. Ethiopia says its primary goal is to boost agricultural production with the introduction of modern farming methods and technology.“There is a disturbing parallel between land being vacated and the land being sold to investors for large-scale commercial agriculture.” Ethiopia says the relocations are part of plans to voluntarily resettle some 1.5 million people in its western regions to villages adjacent to roads and with better water facilities and more fertile land.