Agricultural Investment and Role of Commercial Farming in Benishangul-Gumuz Region: Evidence from Ethiopia

Abstract

Agricultural investment remains the top strategy of the Ethiopian government to contribute to the national economy by changing the traditional farming to modern agriculture. In Benishangul-Gumuz regional state in the last two decades, a substantial amount of land has been transferred to domestic and foreign investors by both regional and federal governments. Hence, this study has aimed to generate information for better understanding of the system and the options available to promote the current agricultural investment and trend of agricultural investment to seize the challenges and harness the existing opportunities. The results revealed that found that the commercial farming is constrained by different factors; these includes lack of access to infrastructures (like electricity and irrigation facilities), unavailability of farm equipment (like combine harvester, thresher and cleaner), inadequate policy incentives, lack of access to improved crop varieties and livestock breeds, lack of access to market, low and volatile price of their produce, were mentioned among the others. On the other hand, availability of storage of grains, road, and mobile network access, ownership of tractor, fair interest rate and access to credit were mentioned as opportunities for the commercial farmers. Moreover, currently, commercial farming is contributing employment (temporary and permanent jobs) and marketing opportunities and income tax payment to the local community and the government. Therefore, we suggest that to tackle the challenges and seize the opportunities in commercial farming, quick government support in areas of infrastructure development, research and development and linking commercial farming with local and international markets is needed.

Keywords: Agricultural Investment; technology; Benishangul-Gumuz

DOI: 10.7176/JESD/10-3-03