Ethiopia‘s agricultural sector is set to undergo a significant transformation with the recent establishment of a shareholders’ agreement between the Ethiopian Agricultural Businesses Corporation (EABC), Ethiopian Investment Holdings (EIH), and UK-based private equity firm Asset Green. This ambitious initiative, valued at $600 million, aims to enhance the nation’s food production capabilities and stimulate economic growth through a comprehensive dairy and crop farming project.
Under the terms of the agreement, ownership stakes are clearly defined: Asset Green will hold a majority share of 51%, EABC will possess 25%, and EIH will control the remaining 24%. This strategic partnership is designed to leverage the unique strengths of each entity, facilitating the modernization and expansion of Ethiopia’s agribusiness landscape.
Phased Implementation
The initiative is structured into two distinct phases:
Phase One: The initial stage will concentrate on the dairy industry, with plans to breed 10,000 dairy cows. This phase includes the development of feed production systems and the establishment of advanced milk processing facilities. The primary goal is to meet the increasing domestic demand for dairy products while reducing the country’s reliance on imports.
Phase Two: Following the dairy initiative, the focus will shift towards crop cultivation and processing, targeting staple crops such as rice, cotton, and oilseeds. This phase aims to diversify Ethiopia’s agricultural output and introduce value-added processing capabilities, thereby enhancing the country’s export potential.
Established in December 2015, EABC is a federal public enterprise formed through the merger of five state-owned entities, including the Ethiopian Seed Enterprise and Agricultural Inputs Supply Enterprise. The corporation is dedicated to supplying agricultural inputs, machinery, and services to improve productivity across Ethiopia.
EIH serves as the Ethiopian government’s strategic investment arm, overseeing a diverse portfolio of state-owned enterprises. Its mission is to attract investments and manage assets to foster economic development and improve the quality of life for Ethiopians.
This partnership aligns with Ethiopia’s broader objectives to modernize its agricultural sector, ensure food security, and stimulate economic growth. By integrating advanced farming techniques and processing technologies, the project is expected to create numerous employment opportunities, enhance export revenues, and contribute to the nation’s sustainable development goals.
Moreover, this collaboration reflects a growing trend of international investment in Ethiopia’s agribusiness sector, signaling confidence in the country’s economic potential and commitment to transformative growth. As the project unfolds, it is anticipated to play a pivotal role in reshaping Ethiopia’s agricultural landscape and driving long-term economic prosperity.
