In the largest single agricultural investment, Ethiopia’s richest man Sheik Mohammed Hussein Ali Al-Amoudi, joined the bio-fuel sector in a joint venture with Jemal Ahmed, one of the biggest edible and palm oil importers in the country.
Establishing Horizon Plantations Plc with a capital of 190 million Br, the two investors received their licenses from the Ethiopian Investment Agency one month ago. Headed by Jemal, in collaboration with AgriNexus of Malaysia, the company plans to embark on an unprecedented project in scope to introduce cash-rich plantation crops to Ethiopia.
“I have never seen a project of this size, Abiy Meskel, director general of the Ethiopian Investment Agency, told Fortune. “It is especially useful for Ethiopia as it is labour intensive.”
This company is expected to grow jatropha, palm oil, rubber trees and tea in the coming five years with a projected investment of 250 million dollars. The total investment land required for the project, which is 250,000hct, five times the size of Addis Abeba, is expected to benefit 350,000 people.
The oil palm investment would be carried out in the Gambela Regional State on 58,000hct of land and the Region is ready to grant the plot for the project, sources disclosed.
Omed Obang, Gambella Regional State President, says land is available but he has not yet received a formal proposal.
Horizon’s biggest project is the 100,000hct plantation of jatropha on 100,000hct, which it wants to carry out in Benishangul Gumuz. The Ministry of Agriculture and Rural Development (MoARD) is undertaking studies for this project.
Ethiopia has 23.3 million hectares of land suitable for oil-rich jatropha, according to a study by the Ministry of Mines and Energy (MoME).
In September 2007 the Council of Ministers approved the first Ethiopian Energy Strategy that includes plans to extract bio-fuel from jatropha, palm oil, caster seed and ethanol from sugarcane. The MoME study indicates that there is 700,000hct available for sugarcane production.
As in Gambella, Benishangul Gumuz Regional State President, Yaregal Aysheshum, has not yet received a proposal from the company.
“The Region has huge available plots, but a project proposal must be reviewed before giving the green light,” Yaregal told Fortune.
Horizon will be the second company to engage in large-scale mechanised palm oil farming. Fri El Green Power, an Italian Company, has previously received 30,000hct from the Privatisation and Public Enterprises Supervising Agency (PPESA) in the Southern Nations, Nationalities and Peoples’ Regional State (SNNPRS) to cultivate palm oil and jatropha with an investment of 320 million Br.
The company hopes to carry out its rubber tree plantation project in Bench Maji Zone of SNNPRS on 85,000hct of land. Rubber tree plantation was first started in Ethiopia by Matador Addis Tyre SC. The company also has 600 rubber trees in Gambela.
The sap of rubber trees is the primary source of natural rubber, which is used widely for industrial products, tyres and furniture.
The third project, tea plantation, is expected to be undertaken either in the Oromia or Gambela regional states on 25,000hct of land. MoARD is conducting a study to parcel the suitable plots.
Sources told Fortune that there is a greater probability that Horizon would be given land for the plantation in Oromia. an Indian Company has already requested to cultivate the plot under consideration in Gambela.
Berhanu Tesfaye, an expert at MoARD, told Fortune the land would be given to Horizon if the Indian company does not develop the land.
Experts from the Ministry have confirmed that over one million hectares of land in the region is suitable for various plantations.
Horizon has signed an agreement on January 23, 2008, with the Malaysian consultant company AgriNexus to give it management roles. Based in the country with over four million hectares of oil and rubber plantations, the company also has experience in plantation development and management in Indonesia and West Africa.
Sheik Mohammed at the end of the signing ceremony stated that the world economy is shaking up with oil and stock markets.
“If we focus on the agricultural sector in Ethiopia, the growth will further expand,” he said.
By WUDINEH ZENEBE
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