Ethiopia flower earnings may surge by 2016-growers

Tue Apr 26, 2011
ADDIS ABABA (Reuters) - Ethiopia's income from horticulture exports is expected to more than triple to $550 million in five years due to rising investment, the head of a growers' association said on Monday.

More than 90 companies, including foreign firms, have set up in the sector, where investors have taken up 1,600 hectares for flower production, and 1,200 for vegetables.

Tsegaye Abebe, head of the Ethiopian Horticultural Producers and Exporters Association said land leases are likely to double for flower production and expand by ten-fold for fruits and vegetables.

"With the current rate of requests, revenue from the export of horticultural products will reach $550 million by that (five years) time," Tsegaye told Reuters.

The Horn of Africa nation earned $110 million from flower exports and $45 million from vegetables in 2010, and it projects that the earnings will rise to $195 million and $60 million respectively in 2011.

"Every year there is a progress of 25 to 30 percent (in export earnings)," Tsegaye said.

"From 2012 onwards, our forecast is more than 35 percent. Flower farms are expected to expand and new projects opened in different parts of the country."

Government officials have identified the sector as key to diversification in an economy long dependent on coffee exports, which usually account for 60 percent of total earnings.

Tsegaye said investors are attracted by incentives from the government which include a five-year tax break, scrapping of import duties and access to financing from banks.