Maximizing Finance for Development in Agriculture and Food Systems in Ethiopia : An Analysis of Beef, Coffee, and Maize
The World Bank Group has developed a new diagnostic approach called Maximizing Finance for Development (MFD). This study pilots the use of the World Bank’s MFD approach to identify areas along value chains (VCs) where the private sector is involved...
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| Language: | English |
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World Bank, Washington, DC
2019
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| Online Access: | http://documents.worldbank.org/curated/en/427371562711707301/Maximizing-Finance-for-Development-MFD-in-Agriculture-and-Food-Systems-in-Ethiopia-An-Analysis-of-Beef-Coffee-and-Maize http://hdl.handle.net/10986/32102 |
| Summary: | The World Bank Group has developed a new
diagnostic approach called Maximizing Finance for
Development (MFD). This study pilots the use of the World
Bank’s MFD approach to identify areas along value chains
(VCs) where the private sector is involved. More important
may be the identification of where the private sector is
currently not involved or only involved peripherially. The
results provide a range of opportunities to consider, with
the purpose of crowding in more private sector investment
and sustainable solutions to achieve the Sustainable
Development Goals and meet the highest environmental,
social, and fiscal responsibility standards. Under each
function, the underlying causes of market failure are
assessed, helping inform a range of possible opportunities
for private sector to participation. The ouputs of this
report can be used for further stakeholder engagement to
prioritize issues and assess solutions. The focus is on the
three VCs of beef, coffee, and maize. These commodities
account for over 50 percent of Agricultural GDP and over 80
percent of foreign exchange revenue for the country and
possess the potential for greater development impact through
enhanced private sector activity. The nature of these
commodities differs in terms of commercialization. Coffee, a
pure cash crop, has close to 95 percent of its product sold
by the farmer. In contrast, maize is primarily a food crop
and 89 percent of maize produced is consumed by farming
households. Cattle, on the other hand, are sold by
pastoralists when cash is needed, cattle are no longer serve
a productive purpose or meeting social obligations. In
highland areas, the commercialization aspect of cattle is
much greater. This has implications for private sector
engagement in the respective value chains. This report
identifies the issues and constraints in these three
selected VCs and suggests opportunities for: (a) the public
sector to amend policy, regulations, and provide inducements
for greater private sector activity; and (b) the private
sector to take on a greater level of responsible
agricultural investment aligned with global good practice. |
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