Ethiopia flower exports to challenge coffee

By Tsegaye Tadesse

ADDIS ABABA, June 23 (Reuters) – Ethiopia’s flower business is booming and could one day overtake coffee, its main export commodity, a leader of the horticultural sector said.

Tsegaye Abebe, chairman of the Ethiopian Horticulture Producers and Exporters Association, told Reuters the Horn of Africa nation was currently generating $20 million annually from flower exports, only one tenth of coffee exports.

“But as expansion of farm areas by 32 existing foreign and local investors is progressing, the total export income from flower is expected to reach $100 million by 2007,” Tsegaye told Reuters in an interview late on Wednesday.

Projects by another 100 investors from the Netherlands, Germany, India and Israel — who have acquired 450 hectares (1,111 acres) of land to prepare farms — should generate another $300 million a year by 2007, he added.

“The aggregate income to be generated from all farms under production is expected to reach $400 million by 2007,” he said.

Out of the 100 new investors, Dutch company Sher Agency has received 300 hectares at Zwai, southern Ethiopia — the largest area ever acquired by a single investor.

“Ethiopia has a great potential and is endowed with vast natural resources,” Tsegaye said.

“Given the speed with which investment in the flower industry is developing, the sector will change the image of the country which is often associated with famine and hunger.”

Membership of the Ethiopian Horticulture Producers and Exporters Association had risen to 32 from just a handful three years ago. Half of them are foreign investors, he said.

They have been attacted by an improved investment code, a five-year tax holiday, duty-free import of machinery, and easy access to bank loans and land acquisition, Tsegaye said.

So far the industry has provided employment for 13,000 peasant farmers, he added.

“They had never had steady income. (Now) they receive seven birr ($0.80) a day and this has helped them to send their children to schools and lead better lives than previously,” he said.

Golden Rose Agro Farmers Ltd, a subsidiary of London-based Rina Investors, is one of the producers of flowers from its farm in Sebeta some 30 kms (20 miles) south of Addis Ababa.

Shahab Khan, farm manager, said the company exports an annual $5 million of roses, mainly to Europe and the Gulf.

Khan said within six years it has expanded its farm from 3.5 hectares to 22 hectares. The company grows flowers in 22 greenhouses with drip lines where water and fertilizer is mixed under computerized central control.

He said the only problem his company faced was lack of air freight to transport their perishable products in time.

“Because of lack of air freight, the company has suffered losses,” he said.

Ethiopia’s annual coffee production, the biggest in Africa, is estimated between 250,000 and 300,000 tonnes. More than half of this is consumed locally.