IFAD to provide US$114.5 million to Ethiopia

IFAD Press Release
Tigrai Online, Ethiopian News, Dec. 02, 2016

Rome, 2 December 2016 – A total of 108,750 poor rural households in four regions of Ethiopia are expected to benefit from a financial agreement signed today between the International Fund for Agricultural Development (IFAD) and Ethiopia to boost small-scale irrigation schemes.

Of the total programme cost of US$145.3 million, IFAD is providing a US$102 million loan and a $12.5 million grant, including $11 million from the Adaptation for Smallholder Agriculture Programme (ASAP) Trust Fund to help smallholder farmers to adapt to the effects of climate change. The programme is co-financed by the Government of Ethiopia ($18.7 million) and by the beneficiaries themselves (12 million).

The agreement was signed in Rome by Kanayo F. Nwanze, President of IFAD; and Mulugeta Alemseged Gessese, Ambassador of Ethiopia to Italy and Rome-based UN agencies.

The second phase of the Participatory Small-scale Irrigation Development Programme (PASIDP II) envisages the development of 15,000 hectares of small-scale irrigation schemes in four regions: Amhara, Oromia, Tigray and the Southern Nations, Nationalities and People’s Region. Particular attention will be given to women, young people and vulnerable groups. In addition to increasing agricultural productivity, incomes and resilience of ecosystems and rural population, the programme is expected to create 15,000 new jobs.

“This programme is not really about irrigation. It is about people. IFAD is a people-centred organization and we invest in rural people,” said Ulaç Demirag, IFAD Country Director for Ethiopia. “At the end of PASIDP II, we will not count how many schemes were built but we will focus on how the programme has transformed the lives of the smallholder farmers we support,” he added.

In Ethiopia, major challenges include soil degradation and loss of biodiversity. Climate change projections for the country indicate a significant rise in temperatures and a possible increase in the frequency of droughts as well. The 2015 El Niño-related drought in East Africa was one of the strongest events recorded, impacting the livelihoods of smallholder farmers, already suffering from the effects of climate change.

PASIDP II will improve the access of farmers to a secure irrigation production system and enhance water efficiency through climate-smart agricultural intensification in the adjacent watersheds. In addition, the programme will support linkages to markets and services so that smallholder farmers can increase their productivity, competitiveness and incomes. It will also enhance their resilience against external shocks and those induced by adverse weather and climate conditions, such as drought. The programme thus aims to improve farmers’ prosperity, food security and nutrition.

Based on the success of the first phase of the programme, including changes in the living conditions of smallholder farmers, best practices will be scaled up during the implementation of the second phase. The programme will also train participants to take charge of the development process and encourage women to join the decision-making bodies of water users' associations.

Since 1980, IFAD has financed 18 rural development programmes and projects in Ethiopia for a total amount of $1374.1 million, with an IFAD investment of $602.5 million directly benefiting 11,078,750 rural households.

Press release No.: IFAD/76/2016

IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience. Since 1978, we have provided about US$18 billion in grants and low-interest loans to projects that have reached some 462 million people. IFAD is an international financial institution and a specialized United Nations agency based in Rome – the UN’s food and agriculture hub.