Oilseeds, pulses becoming export revenue engine

The share of the stated export items, whose contribution to the country’s foreign exchange earning was almost nil a decade ago, has become the number two largest source of export revenue next to coffee overtaking hides and skin and other export products. Pulses and oilseeds including spices, which generated only 70.5 million USD in 1995 Ethiopian fiscal year, went up over 122.7 million and 148.5 million USD in 1996 and 1997 E.C. respectively, increasing by 34 million USD per annum on average, indicates a data released by the Ethiopian Customs Authority. The stated products generated a sum of 138.5 million USD in seven months this year alone maintaining their place as second major export revenue source after coffee. The amount Ethiopia gets in seven months this year is less by only 10 million USD from that of the amount obtained in the whole of last year. Entrepreneurs engaged in the sector attribute the rise in the sum earned from the products mainly to effective implementation of export-led economic policy and provision of various incentives to exporters as well as extensive economic diplomacy done by the Ethiopian diplomatic missions abroad. The easy access to loan made available by the government to exporters, tax exemption and the promotion made by Ethiopian diplomats abroad have a significant contribution to the growth of the foreign exchange earning obtained from the aforementioned products, says Manager of International Trade with Malima Private Ltd. Company, one of the leading exporters of the stated items. The provision of adequate loan that was made available by the government has helped us (exporters) to increase our capacity of exporting the products as per global market demand thereby helped to generate more hard currency in the last three years, he added. Others say measures taken by the government to improve capacity of service providing organizations were the other factors contributed for the rise in the amount of hard currency the nation gets from the sector. For instance, 52 per cent of oilseed, pulses and spice exported by his company this year to China was the result of the efforts of the government, whose members of the diplomatic missions have done their homework well there (in China), Yeshiwas said. The government has done activities in building the image of the country (Ethiopia) abroad which helped partly exporters in the sector get good market abroad, he added. Educational orientation being provided by the government to farmers about the importance of producing cash crops and of maintaining quality were the other reasons for the rise in the export volume and hard currency the nation gets from oilseeds, says Mulualem Berhanu, General Manager of Guna Trading House. The stated products had also played an important role in redressing the country’s ailing export revenue because of the dwindling prices of coffee, whose share in the nation’s foreign exchange earning drastically dropped by 30 per cent in early 2002. Their contribution to the total export revenue rose from less than 5 pre cent in the past went up above 15 per cent in 2001 when that of coffee plummeted from 70 per cent to only 41 per cent, according to the Ethiopian Export Promotion Agency. The stated products accounted for 30 per cent of the country’s total foreign exchange earning, according to the Ethiopian Oilseeds and Pulses Exporters’ Association Secretary General, Negussie Belayneh. Some exporters predict that these cash crops will likely to be the country’s important export products in the future contributing a lot for the growth of the nation’s economy by generating substantial amount of hard currency. Oilseeds, pulses and spice, which were once on the bottom of Ethiopia’s export items’ list, came to forefront becoming one of the hopes of the nation to free it perhaps from grinding poverty in the foreseeable future. ‘

April 2006
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