ADDIS ABABA – Ethiopia has signed a 15 million Euro loan agreement with Germany Development Bank (KFW) to boost its effort to mechanize the agriculture sector.
The agreement was signed between the Ministry of Agriculture, Development Bank of Ethiopia, and KFW officials on Monday.
The money that will be provided in the form of loans for agribusiness enterprises and individuals devoted to agriculture in a bid to improve and catalyze agricultural productivity.
From planting to harvesting, farmers are not getting adequate modern technologies due to financial constraints.
In this regard the provided loan from KFW is a very good beginning to activate and build farmers’ capacity, Sani Redi, state minister of agriculture, told The Daily Monitor.
Out of 15 million Euros, about 2 million euros will finance the ministry of agriculture’s capacity building training program for people either engaged in or plan to engage in the agriculture sector.
The remaining 13 million will be loaned out for enterprises to provide agricultural mechanization technologies to farmers.
The use of agricultural techs in Ethiopia is below the African standard, said Sani, adding that the loan “will play a crucial role to solve a capital shortage to import the tech and contribute to increasing national food production” in the country.
Ministry of Agriculture said it will facilitate and select farmers, youths, investors and businesses that will be benefited from the latest loan.
Development bank of Ethiopian, through its lease financing procedure, will provide the loan for the potential farmers and technology providers and farm agencies.
Klaus Muller, KFW east African director, said it is an innovative financing mechanism to bring lasting impact at the national level.
By Sisay Sahlu