PM Abiy Ahmed (PhD) approved an initiative to establish the first agricultural bank in Ethiopia. The idea to create a specialized bank that serves the sector, was imbedded in the draft Agriculture and Rural Development Policy, which is revised and expected to be launched soon.
Though the idea was forwarded by Agricultural Transformation Agency (ATA), while the Ministry of Agriculture has initiated the move and is already in preparation to establish the agricultural bank, Chimdo Anchala (PhD), Senior Director for Production and Productivity at ATA, confirmed to EBR. “employees working in the agriculture sector, and also the private sector engaged in agricultural businesses will be the shareholders. many new banks are being established but none are specializing in agriculture.”
There are over 3,000 people employed in the sector, expected to be shareholders.
“Access to finance is big problem in agriculture. Capital is formed in agriculture sector but invested in other sectors such as construction. It is very difficult to access foreign currency even to import fundamental inputs such as fertilizer, although foreign currency is generated by exporting agricultural commodities. The new agricultural bank will solve these problems, especially in financing agricultural input supply,” said Mengistu Tesfa, Director of Agricultural Inputs and Market Directorate at the ministry.