Environment and Economic Development in Ethiopia

May 28th, 2009 | by addis portal |

By Getachew BelainehI am writing this article with full confidence and trust that concerned officials and readers will take it as a constructive technical opinion that supports making an effort to utilize Ethiopia’s natural resources in a sustainable and responsible manner. To begin, without hesitation I commend the efforts to utilize the nation’s natural resources including the rivers, minerals, and fertile soils to alleviate poverty and make the country a better place to live. The country is desperately poor and its natural resources are among the first targets for economic development. Obviously, developmental activities have thrived in the country in the past decade. However, it is feared that officials are only aimed at short-term economic gains and are causing massive ecosystem extinctions. This fear is the catalyst for writing this article. The article attempts to accentuate the grave consequences of developments that are only aimed at short-term economic gains and ignore sustainability.

The message aims at the broad spectrum of industrial and agricultural developments and small and large developments; however, not to be wearisome, few are singled out vis-à-vis water infrastructures, cement factories, land leasing, and commercial flower farms and are bound to hit upon two issues: sustainability and the contentious national benefit. By no means is the intent to downplay these efforts, rather it is to call attention to the seemingly overlooked development-induced irreversible environmental consequences and misconstrued benefit. At this point, it is worth mentioning the plea more than 1,500 of the world’s top scientists made in 1993: “We must recognize the earth’s limited capacity to provide for us. We must recognize its fragility. We must no longer allow it to be ravaged. This ethic must motivate a great movement, convincing reluctant leaders and reluctant governments and reluctant peoples themselves to effect the needed changes.”

Industries ranging from small food processing plants to huge complex cement factories have detrimental effects on the nation’s growth. Agricultural developments not only offer food security, but can also be lucrative and play a major role in hard currency earnings. However, these developmental efforts will furnish meaningful national benefits only when planned and implemented in a sustainable and responsible manner. The government often sees developmental activities as having the potential to meet traditional economic desiderata to enhance citizens’ short-term satisfaction with the administration. Long-term social and environmental aspects should be given the same significance as economic and financial factors. Oftentimes, the much-trumpeted benefits may not necessarily be beneficial as they are made to sound in the media, because they do not include the costs of protecting the environment from development-induced environmental and social impacts. The essence of sustainable development is a stable relationship between developmental activities and the natural system, which does not diminish biodiversity and the prospects for future generations. Developments alone solve only half of the equation of economic growth. The other half of the equation deals with the sustainability and protection of induced ecosystem impacts. A true development ought to solve both equations simultaneously, such that the needs of the present are met without compromising the biodiversity and the ability of future generations to meet their own needs. Ignoring sustainability is the same as ignoring future generations. With that, said on the general, the following section would scrutinize selected current developmental activities.

Gilgel Gibe Dams: The development of multipurpose water infrastructure in general is critical to effective economic growth. In the past 10 years or so, the country has installed two major hydropower dams: Tekeze dam in Tekeze River in the northern part of the country, and Gilgel Gibe I in the tributary of Gibe River, Gilgel Gibe (Baby Gibe), in the western part. The construction of the Gilgel Gibe II hydroelectric plant and Gilgel Gibe III dam on Omo River are currently underway. Gilgel Gibe II situated on the Gibe River mainstream, is an extension of Gilgel Gibe I, and does not involve a dam. Gilgel Gibe III, the biggest hydroelectric project in Ethiopia, is being constructed on the Omo River, which is about 150 km downstream of the Gilgel Gibe II site, and when completed will add 1,870 megawatts to the power grid. The Omo River is an international (trans-boundary) river that begins at the confluence of the Gibe and Gojeb rivers and discharges into Lake Turkana in Kenya. All three Gilgel Gibes can be viewed as a single water infrastructure because they impact the same basin. Some fear this series of hydro-infrastructures (especially, Gilgel Gibe III) will impose a serious negative impact on the downstream ecosystem including Lake Turkana. It is a legitimate fear.

The Los Angeles Times published an article in its May 14, 2009, issue about the environmental problems Gilgel Gibe III will impose on the people living downstream. A California-based environmentalist group has also asked the bank to stop funding the construction of the dam, citing the threat the dam would impose on Lake Turkana in Kenya.

Without a doubt, Gilgel Gibe III will alter the natural Omo River flow pattern. The alteration may range from brief no flow conditions in dry seasons to unnaturally high flow when water is released from the reservoir to run the turbines. This is indeed a serous but manageable problem. Ethiopia may not have minimum flow criteria for any of its rivers at present. Without getting into the complex relationships between minimum flow level and the ecosystem, the simple approach to set minimum flow level would be to identify the lowest flow in the Omo River using historical flow records and allowing that rate during dry seasons. The impact from unnaturally high flow can be reduced by diverting the excess flow to irrigation fields or other water supply systems. The upstream side of the dam also has its share of significant impacts resulting from the inundation of the 34,000 square kilometer (34 million hectares) reservoir. In fact, unlike the downstream side, the upstream effect is all seasons for the life of the dam, which is 70 or 80 years. An increase in malaria and schistosomiasis (aka bilharzia) is expected to spread around the shore of the reservoir. The natural ecological, historical, and maybe archeological resources will be permanently inundated. Not to mention, the people who will be displaced from the submerged area.

Having said that much about the consequences of Gilgel Gibe III, the argument to stop the project by only the environmental concerns has no merit. Despite the potentially negative impacts, the Gibe hydropower dams can yield huge environmental benefits both locally and regionally. The power produced hydroelectrically is much cleaner than coal burning and will reduce greenhouse gas emissions. The aforementioned environmental consequences are preventable with careful operation system and robust mitigation activities. According to the Africa Development Bank (ADB), about 267 million Birr (US $27 million) is budgeted for mitigation of the upstream and downstream ecological impacts. However, it should be mentioned that there is no evidence that the government’s implementation of mitigation works as mentioned in the loan document. The trend is to put environmental issues on the front burner until closing the loan and then later forget about it. The timely implementation of ecological mitigation is often a fundamental part of ensuring that a project is environmental friendly and delivered on time.

On the flip side, the economic feasibility of the Gilgel Gibe III project is an open question that needs serious attention. The project construction is underway since 2004 with an estimated total cost of about 21 billion Birr (US $1.86 billion). According to an Italian company who analyzed the project, the implemented has began without a comprehensive pre-project option assessment and cost/benefit analysis. One of the elements that determine the economic feasibility is the electric power sell arrangement. As reported by the government, the target markets are domestic consumers and export to neighboring countries. Regarding the domestic market, based on the current indicators, the electric supply from Gilgel Gibe III could be unaffordable for many domestic consumers for the near future. With respect to export, the government is currently negotiating power purchase agreements with Djibouti, Sudan, and Kenya, although none have signed a commitment to date. In fact, the recently heightened controversy surrounding the Gilgel Gibe III project originates from Kenya because of the ecological effect on Lake Turkana. On these grounds, it would be naïve for the Ethiopian government to target Kenya as a potential market. The life of the dam is the other major factor determining the economic feasibility of the project. In order to utilize the dam to its maximum design life, the reservoir must be protected from siltation. Siltation effectively reduces the dam’s life as manifested in Koka hydroelectric dam in Ethiopia and elsewhere in the world. Siltation problem can be minimized if prior to the compeletion of the the contributing watershed is rigorously treated to reduce sediment transport. Hydrologically, because of the frequent drought occurrence in the country, the dam could be vulnerable to drought or severe climate changes.

In sum, Gilgel Gibe III can be environmentally tolerable if implemented with the necessary ecosystem protection schemes, but its economic feasibility and sustainability is still wobbly.

Derba Cement Factory: The construction of a relatively large cement factory known as Derba Cement factory is another developmental activity currently in progress. This factory is located in the Sululta region about 70 km north of Addis Ababa. When completed, along with the others, the factory is expected to meet Ethiopian cement demand for some time in the future. The overall benefit of this factory is luminously reported in various local media outlets and by its officials, and there is no need to echo it here. The underreported and unrecognized aspect of the factory is its adverse social and environmental impacts. The factory buildings, the quarry site, and the roads are stretched over a total area of about188 hectares. The quarry and factory are situated relatively far apart. The factory is located on a pristine beautiful green plateau about 8 km from Derba village near the town of Sululita. The quarry site is in the Mugher Valley connected by a 7 km conveyor to the factory. One would wonder why the factory is not situated within the vicinity of the quarry site instead of in undisturbed natural landscape. It appears maximizing the company’s profitability was the primary objective in the selection of the factory’s location. The parent company, Midroc, is a company that can only survive by making a profit or in the hopes of making a profit in the future. So it is within its interest to locate the factory in an optimum position to gain maximum profit. There is nothing wrong with the company’s interests; the problem is the environmental issues were not addressed.

The other concern with the Derba Cement factory is its huge appetite for water, which is estimated to be 2,000 cubic meters (2 million liter) per day. The factory is permitted to pump ground water to meet its water requirement, and the environmental and social impact assessment (ESIA) document shows pumping 2,000 cubic meters per day is much less than the natural groundwater recharge rate in the area and will not cause any undesirable impact on the region’s water resources (Africa Development Bank). The bank document do not show what kind of data and method of analysis was used to arrive at that conclusion. It is unclear whether scenarios such as an extended dry period which is fairly common in the region, and projected population and demand growth are considered in the analysis. At any rate, from a resources conservation perspective, the more sound approach could be for the factory to build its own surface reservoir to store surface runoff and use groundwater as a supplemental source. There is no record showing environmental mitigation to offset any unavoidable impacts with restoration or enhancement of other areas. Normally, mitigation actions (if there are any) are required to occur before the company begins construction.
The timely implementations of the environmental protection systems and the mitigation plan will provide a win-win situation to promote both economic benefit of the factory and environmental protection.

Cut Flower Business: The development of cut flower farms is on the rise predominantly within the Great Rift Valley. Until the late 70s, flower growing was merely a household activity in Ethiopia. Only after the mid-80s was commercial expansion of flower growing with an emphasis on overseas markets. In the 80s, there was only a single flower farm on about 25 hectares of land near the town of Zeway about 130 km south of Addis Ababa, and it was owned and operated by the government. Determined to grab a slice of the lucrative cut flower market, it has been about a decade since the government has started encouraging foreign investors to cross the border. Spurred by five-year tax holidays, and duty-free machinery import, flower farms now cover an area of about 1,500 hectares in the span of the past 10 years. About 90 local and foreign enterprises are involved, but the majority of the land is owned by foreigners. For example, a Dutch company alone is engaged on a 500-hectare flower farm in the Zeway area. Although the net national revenue is unknown, reportedly, cut flower export generates a gross $160 million a year with an estimated annual growth rate of about 20 percent. The present global financial crises might have retarded the export temporarily. Nonetheless, basic business concepts dictate that the country’s revenue in this market is only a small fraction of the gross income. The following section will explore the social and environmental impacts.
Water is a scarce resource across most parts of Ethiopia. However, despite the high level of consumptive of water, flower farms continue to thrive without consideration of an efficient irrigation system. Studies show about 90 percent of a flower is water; therefore, exporting flowers is exporting fresh water. The consumptive use with the most efficient irrigation system is about 40 cubic meters or 40,000 liters per day per hectare. Simple math shows that the 1,500 hectares of farmland consume about 60,000 cubic meters (60 million liters) per day. In fact, less efficient farms, which are mostly the case in the absence of water use regulations, can use three times as much. In Kenya, the water level in Lake Naivasha is about 3 meters lower than its normal level due to the commercial flower farms in the surrounding area. In Ethiopia where drought is frequent, it will not be too long before the groundwater will be depleted and those scenic and biologically diverse Great Rift Valley lakes disappear. The Great Rift Valley ecosystem is breathtakingly attractive and serves as a habitat for diverse wildlife including several rare bird species. If there is anyone who is not a nature admirer before coming to the Great Rift Valley, certainly he or she will be after visiting the area. For instance, Lake Ziwaye is one of the freshwater lakes known for its population of birds and hippopotamuses and supports a fishing industry. This natural set up is at stake unless the water usage and chemical application is robustly regulated. The disappearance and/or poising of these freshwater lakes mean the extinction of birds, fish, and hippos that are housed by the lakes. Regulating water usage not only promotes an effective irrigation system that delivers necessary quantities of water, but also reduces the transport of nonpoint pollution to the lakes and groundwater. There is no legal framework guiding the use of surface water or groundwater resources in the country. This is alarming call to set one up.

Excessive toxic pesticides, inorganic fertilizers (nitrate and phosphate), and preservative chemicals are another serious concern associated with commercial scale flower farms. In fact, flower buyers’ demand for unblemished and pest-free flowers encourages growers to use excessive amounts of highly toxic chemicals. To meet this demand, flowers both on the farm and in the packaging process are frequently and liberally sprayed with a multitude of chemicals. In many developed countries, operating a commercial flower farm is no longer profitable due to the costly environmental protection criteria. This is partly the reason flower growers choose to establish their farms in the Third World where there is minimum or no environmental regulation, and of course, a cheap workforce. Recently, the managing director of Sher Ethiopia, one of the large-scale flower farms, said his farm follows European environmental regulation standards because Ethiopia’s regulation is not robust enough to protect the environment. The manager is correct about the nominal regulatory system, and that is an embarrassment to the responsible governmental agencies. However, it is hard to believe that the company voluntarily imposed tighter environmental regulations on itself, incurring additional costs out of its own free will to protect the environment.

When pesticides and fertilizers are applied excessively or improperly, the excess is washed off from the farms to downstream rivers, streams, and lakes, causing an array of problems including poisoning, increased algae blooms, and excessive plant growth leading to eutrophication making the water bodies and vegetations harmful to human, wild, and aquatic life. Cattle and wild animals eating the contaminated vegetation and drinking the poisoned water transfer the chemicals into the food chain. Koka Lake is on the verge of ecological collapse due to recent harmful algal bloom resulting from the drainage of flower farms and other industries into the watershed. The local people who have no choice but to drink the lake’s water each day are left to deal with a range of health problems ranging from fatal chronic diarrhea to babies born with birth defects. Further more, many of the flower farm workers suffer from health problems linked to unprotected daily exposure to toxic pesticides. Even more frightening is that some of the damage to the workforce’s health could be irreparable.

The slave wage, nonexistant compensation plan for injuries at work, and the long work hours compounded with the unprotected work condition makes the work environment equivalent to a concentration camp. The real tragedy is that the workers have no say regarding their rights because they are not allowed to form a labor union. Ironically, there is a Flower Exporters Association representing the investors that gives them the power to use an illiterate, unprotected, and underpaid workforce. The government has given due attention to the industry because of the revenue it collects. No one seem to pay attention to the environmental mismanagement, labor abuse and unfair land holding. As part of its social responsibility recently, Sher Ethiopia, has constructed a Stadium with half a million USD and granted to the community with 25,000 USD donations (Africa News). The same news paper published that Minister of Agriculture and Rural Development acknowledged Sher Ethiopia for its outstanding social responsibility activities and pointed that it can be taken as a model of good business practice by other business companies. This is laughable. What good is a stadium do to a community whose health is at risk, and whose labor right is redeculesly violated, whose environment is ireversably damaged?

Leasing Land to Foreigners: The inherently low agricultural productivity, together with the current shortage of foreign currency, led the government to begin leasing huge chunk of fertile lands to foreign countries for agricultural development. The leasing arrangement essentially offered foreign investors not only fertile soil, also unlimited access to scarce freshwater resources and a cheap labor force. According to a report written jointly by two UN bodies, Food and Agriculture Organization, and the International Institute for Environment and Development, African countries are giving away vast tracts of farmland to foreign countries and investors almost for free, with the only benefits consisting of fuzzy promises of jobs and infrastructure. Countries like Saudi Arabia, Djibouti, Libya, and Egypt who are short of fertile land and freshwater resources are buying or leasing land from countries all over the world. Ethiopia is one of the targets. According to the government officials, the food produced on the leased lands will be available to domestic markets as well as for export. That is a publicity stunt because domestic consumers cannot possibly compete with the prices foreign consumers would pay. Many are wary; not only the food but the profits from this farming would be siphoned off to consumers and investors in other countries.

It is true that revenues from taxes, and tariffs may give the government limited short-term relief from the hard currency shortage. However, this marginal short-term monetary benefit compounded with the long-term residual adverse impact on the community and the ecosystem makes the leasing of land to foreigners an unwise exploitation of natural resources.

Arguably, the government used the inherently low agricultural productivity in the country as an excuse for the strikingly short and simple land leasing contract compared to the economic reality of the transaction. However, leasing land to foreigners cannot be the way to improve productivity (yield per hectare) and thereby the country’s food security. The way to improve inherently low agricultural productivity is by helping local farmers improve their primitive farming practices, making available the necessary yield-boosting inputs including fertilizers and improved seeds, and reforming the land ownership policy to liberalize the agricultural sector to promote private sector development. Leasing fertile land to foreigners is without a doubt more beneficial to leaseholders than the country.

Suggested General Solutions: All the above-mentioned environmental and social impacts are preventable or at least can be substantially minimized with a practical and effective regulatory system. Here are some suggestions: (1) It should be mandatory for each industry and construction project in the country to pass through an environmental permitting processes before establishing the firm or implementing the construction. In the permit application, the permitting agency, based on pre-established site-specific specifications, must evaluate the company’s ability to meet the nation’s environmental protection criteria. (2) In addition to the site-specific environmental regulatory criteria, the permitting process must also require chemical intensive farms including flower farm industries to be fair trade certified. Fair trade certification provides an independent verification that the workers on the farms have decent wages and working conditions in line with the core International Labor Organization (ILO) Conventions and farms are environmentally friendly. The certification includes the right to join a trade union, the right to negotiate collectively with the employer on terms and conditions of employment, freedom from discrimination, and a safe and healthy working environment. (3) There must be an agency in charge of reinforcing environmental regulation by monitoring to ensure effluents from farms or industries meet the quality standard.

In the bigger picture, environmental education should be a part of the school curriculum at every grade because student knowledge of basic environmental concepts establishes a foundation for their future understandings and actions as citizens. Universities should consider offering high level Environmental Sciences and Environmental Engineering courses leading to professionals in the respective fields. Specially, science, agricultural and engineering colleges/faculties ought to be fully engaged in producing scientists and professionals in Environmental Sciences/Engineering fields. Addis Ababa University has recently opened an Institute of Environment, Water and Developments (IEWD) under the College of Development Studies. That is a good start.

The country has great growth potential, but this potential is not realized due to multiple factors. The leading factor is the ineffectiveness of the responsible agencies. This article would be incomplete without a few words about the agencies supposedly responsible for agricultural developments and environmental protection. These agencies are the long-standing Ministry of Agriculture and Rural Development (MOARD), Institute of Agricultural Research (IAR), and the Environment Protection Authority (EPA). The latter is a relatively young agency established approximately in 1992. IAR was established in 1966 with mandates to formulate the national agricultural research policy; carry out researches in various agroecological zones of the country. According to publications, IAR’s golden period was approximately between the 70s and early 80s when considerable research results have been released improving crop yield and stress resistance. The agency appears to be in a frozen mode since then. MOARD is one of the oldest, the largest and well-staffed ministries in the country. MOARD was established with mandate to sustainably improve agricultural and rural developments in the country by providing the necessary technical, infrastructural and institutional support, and ensure safe agricultural operations having due regards to nature diversity and protection of the environment. Yet farming is still primitive, agricultural productivity continues to decline, and most farmers are producing below subsistence level, and environment is endangered by unregulated commercial farms. In sum, primarily due to bureaucratic entanglements and outdated administrative set ups MOARD, and IAR to some degree have become blind to the real issues the country is facing vis-à-vis the under development of agriculture. According to the United Nations Development Program, about 74 million hectares of land are arable with only 10 percent presently cultivated. The under-utilization of the vast areas of fertile land established an excuse for the government to move towards attracting and encouraging foreign companies to lease the land. Leasing land to foreign countries is not necessarily the best solution, as shown above, but clearly indicates that MOARD and IAR are not living up to their duties and responsibilities to help farmers utilize the land and become productive. EPA is a relatively new agency and appears to be overwhelmed by the thriving anthropogenic environmental issues. Outsourcing some of the monitoring and regulatory tasks may help EPA to tackle many of the issues.

As part of the effort to improve the agricultural productivity, MOARD and IAR need radical institutional transformations to cure them from their chronic bureaucratic entanglements and outdated administrative styles.

Concluding Remark:
The effort to make the most of natural resources to improve living conditions in the country is admirable. However, it is poignant not to do it sustainably and responsibly. We are not the final generation of the country. There are future generations to consider. They too need these resources for their existence. Contrary to that animal, let the grass continue to grow even after we expire.

The author can be reached at gbelaineh@yahoo.com

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