An Assessment of Challenges and Prospects of Foreign Direct Investment in Agricultural Sector in Ethiopia (With Reference to Foreign Investment in Large Scale Farmland)

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Addis Ababa University


It is obvious that our country has engaged in farmland deal with foreign agricultural investors. The government is leasing tenth of thousands of hectors of farmland to foreign agricultural firms. Therefore, this study is done with the main objective of examining the major benefits and as well threats of foreign investment in large scale farmland in Ethiopia. Thus, this paper has attempted to explore the challenges that made difficult for the country to easily drive the due benefits from foreign investment in large scale farmland. To this end the study collected primary source of data from concerned government authorities and as well from assessed foreign agricultural firm. Secondary sources of data were also used in addition to the primary data gathered. The study has found that there are various obstacles that have challenged the government from driving the due benefits from the contracts of large scale farmland. For instance the issue of transparency and consultation with local farmers and community can be mentioned among many others. The profitability of any foreign investment to a given host country depends on that respective country’s government role, that makes it beneficiary to the host country or misery to that host country. Therefore, the study was concluded by recommending certain necessary suggestions, that may enables the government to get a due benefits from large scale farmland deal and consequently address some challenges that hampered the process of the deal and thus strengthen the prospects of foreign investment in large scale farmland



Large scale farmland