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BMI View: Production prospects look broadly favourable for Ethiopian
agriculture over the long term. This will largely be due to more investment in
the sector, along with higher incomes contributing to consumption growth. We
believe the sugar sector has the most potential, as investments in new sugar
refineries will make sugar one of the few reliable agricultural exports over the
forecast period. In terms of grains, the country's food security will remain in
a precarious situation due to recent droughts linked to El Niņo. Moreover, even
with recent multinational interest in the country's farmland, Ethiopia is most
likely to remain a net grains importer over the medium term.
-Sugar production growth to 2019/20: 148.8% to 746,500 tonnes. Investment by the
state-run sugar corporation is likely to lead to a significant increase in the
area dedicated to sugar production. The aim of the plan is to make Ethiopia one
of the world's top 10 largest sugar exporters.
-Coffee consumption growth to 2020: 4.2% to 3.1mn bags. Economic gains will
boost consumption, although Ethiopians already have high per capita consumption
rates compared with neighbouring Kenya and Uganda.
-2016 real GDP growth: 7.0% (down from 8.1% in 2015; predicted to average 7.4%
from 2016 until 2020).
-2016 consumer price inflation: 8.2% average in 2016 (up from 10.4% in 2015).