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This study reviewed the status of natural resources and the driving forces for change, as well as past and ongoing approaches in natural resource management at the watershed scale in Ethiopia. First, we reviewed established environmental policy tools and the legal and policy framework, and determined whether innovative financing mechanisms are working in other areas with a similar context. We undertook stakeholder analyses and mapping to identify key stakeholders, and to assess their possible roles in the implementation of a sustainable financing mechanism for watershed rehabilitation. We also determined whether opportunities exist for financing mechanisms involving hydropower and urban water supply in payments for ecosystem services (PES), and the global community in the Clean Development Mechanism (CDM) in the context of the Bale Eco-region. The study identified major constraints to designing an appropriate financing mechanism. Finally, the study drew important conclusions and key policy implications that are relevant for Ethiopia and perhaps other areas in a similar context.

International Water Management Institute (IWMI).

The study examined whether the use of spate irrigation in drought-prone areas of Ethiopia reduced poverty. Each of about 25 users of indigenous and modern spate irrigation schemes and an equal number of corresponding nonusers from the same peasant associations in Oromia and Tigray regional states were interviewed. The survey found that the poverty level of the spate irrigation users was significantly lower than that of the nonusers in terms incidence, depth and severity. Access to improved spate irrigation has led to reduced poverty, measured by all poverty indices, compared to traditional spate. Finally, the dominance test showed that the poverty comparison between users and nonusers was robust. From the study, it can be concluded that the use of spate irrigation in areas where access to other alternative water sources is limited, either by physical availability or by economic constraints, can significantly contribute to poverty reduction, and that modernizing the spate system strengthens the impact., In Erkossa, Teklu; Hagos, Fitsum; Lefore, Nicole. (Eds.). 2014. Proceedings of the Workshop on Flood-based Farming for Food Security and Adaption to Climate Change in Ethiopia: Potential and Challenges, Adama, Ethiopia, 30-31 October 2013. Colombo, Sri Lanka: International Water Management Institute (IWMI).

Irrigation development is seen as one of the means to reduce poverty and promote economic growth. While a lot of effort is exerted towards irrigation development, little attempt is done to quantify the contribution of irrigation to national income in Ethiopia. This study is an attempt to quantify the actual and expected contribution of irrigation to the Ethiopian national economy for 2005/06 cropping season and 2009/10 using adjusted net gross margin analysis. Our results show that irrigation in the study sites generates an average income of about USD 323/ ha. This compares to the calculated gross margin for rainfed which is USD 147/ha. This indicates that after accounting for annual investment replacement cost net gross margin from irrigation is more than twice higher than gross margin from rainfed agriculture. On the contribution of irrigation to national economy, in 2005/06 smallholder irrigated agriculture contributed about 262.3 million USD. This accounts for about 4.46 percent of the agricultural GDP in 2005/2006 and 1.97 percent of the total overall GDP. The total income earned from large scale schemes is estimated to be about 74.0 million USD. This accounts for about 1.26 percent of the agricultural and 0.5 percent of the total GDP respectively. Overall, the contribution of irrigation to agricultural and total national GDP was about 5.7 and 2.5 percent during the 2005/06 cropping season. As a result of expansion, by the year 2009/2010 the expected contribution of smallholder managed irrigation to national economy, assuming that exiting cropping pattern, and the average gross margin values for different crop categories are still valid, is expected to increase from USD 262.3 million in 2005/2006 to about USD 414.2 million in 2009/2010, which accounts to about 5.5 percent of the agricultural GDP and 2.3 of the overall GDP for the same year. On the other hand, the contribution coming from the large scale sugar growing estates in 2009/2010 is estimated to be USD 217.5 million which amounts to 2.9 and 1.2 percent of the agricultural and overall GDP respectively. Similarly the contribution coming from large scale commercial farms growing crops other than sugar cane is expected to increase to USD 35.8 million in 2009/2010 which accounts to 0.4 and 0.2 percent of the agricultural and overall GDP respectively. This implies that large scale commercial farms will contribute about 3.3 and 1.4 of the agricultural and overall GDP respectively. In summary, our results indicate that under conservative estimates the future contribution of irrigation to agricultural and overall GDP will be about 9 and 3.7 percent respectively. When some of the assumptions related to cropping pattern, input and output prices, 128 and efficiency levels are relaxed, the contribution of smallholder managed irrigation to agricultural and overall GDP will vary between 4 to 6 and 1.8 to 1.9 percent respectively. Similarly, the contribution from large scale irrigation to agricultural and overall GDP will be in the range of 3 to 6 and 1.2 to 2.5 percent respectively. Overall, the future contribution of irrigation to agricultural GDP will be in the range of 7 to 12 percent while the contribution to overall GDP will be in the range of about 4 percent. To enhance the contribution of irrigation to national economy, besides increasing the presence of physical water infrastructure, however, there is a need to: i) improve provision of agricultural inputs, ii) promote high value crops through the extension system, iii) create good market conditions, and iv) increase the efficiency of small and large schemes., In Awulachew, Seleshi Bekele; Loulseged, Makonnen; Yilma, Aster Denekew (Comps.). Impact of irrigation on poverty and environment in Ethiopia: draft proceedings of the symposium and exhibition, Addis Ababa, Ethiopia, 27-29 November 2007. Colombo, Sri Lanka: International Water Management Institute (IWMI).

Land and water institutions play a vital role in managing and sustaining land and water resources as well as enhancing economic development and poverty alleviation efforts. While a lot has been done in terms of understanding the micro-determinants of farmers’ decisions in land and water conservation, there is little attempt to understand the broad macro-institutional and organizational issues that influence land and water management decisions. The objective of the study was to assess institutional arrangements and challenges for improved land and water management in the Ethiopian part of the Blue Nile Basin (Tana and Beles subbasins). Focus group discussions and key informant interviews were held in Amhara and Benishangul Gumuz regions with important stakeholders such as the bureaus of Agriculture and Rural Development, Water Resources Development, Environmental Protection and Land Use Administration (EPLUA), National Agricultural Research Systems, and important NGOs, operating in the area of land and water management, and selected community members. As the major findings in this study, we outlined major land and water-related institutional arrangements that are currently in place and their design features, in order to identify those institutions related to superior performance. We highlighted major institutional and policy gaps and actions that are required to respond to emerging issues of environmental degradation, upstream/downstream linkages and climate change. Such analysis of institutions and their design features provides useful insights and contributes to the debate on institutional reform for improved land and water management in the Blue Nile Basin, in general. By doing so, it identifies the gaps in institutional arrangements and policies and potential remedies., In Awulachew, Seleshi Bekele; Erkossa, Teklu; Smakhtin, Vladimir; Fernando, Ashra (Comps.). Improved water and land management in the Ethiopian highlands: its impact on downstream stakeholders dependent on the Blue Nile. Intermediate Results Dissemination Workshop held at the International Livestock Research Institute (ILRI), Addis Ababa, Ethiopia, 5-6 February 2009. Colombo, Sri Lanka: International Water Management Institute (IWMI).

The study examined the extent and nature of market oriented production in irrigated compared to rainfed systems in Ethiopia. By doing so the paper identifies the role of irrigation in market-oriented production, while at the same time highlighting the main constraints to market oriented development. Our results indicate that irrigation contributes significantly to increases in market participation, volume of marketed produce and, hence, income, by inducing shifts in farmers’ cropping mix. The impact of commercialization of production on household food security is not direct and immediate mainly because of failures in the food market. While irrigation enhances market production, there are series of factors that pose serious constraints to market production. Land size, oxen holding, access to market and means of transport were found to be important determinants of market oriented production calling for policy interventions in land markets, access to productive assets and infrastructure development and policy measures to improve the performance of agricultural markets. The study also found education has market promoting effect in terms of increasing the probability of participation and volume of sale. Increased support to education can, thus, help in the long-term to transform traditional subsistence agriculture into more market-oriented agriculture. Finally there are unobserved site specific effects, related to location and other covariates, which influence market participation and volume decisions., In Awulachew, Seleshi Bekele; Loulseged, Makonnen; Yilma, Aster Denekew (Comps.). Impact of irrigation on poverty and environment in Ethiopia: draft proceedings of the symposium and exhibition, Addis Ababa, Ethiopia, 27-29 November 2007. Colombo, Sri Lanka: International Water Management Institute (IWMI).

Recently, there has been very little irrigation development in sub-Saharan Africa. The main reasons cited for this lack of interest in developing irrigation in sub-Saharan Africa is that irrigation projects are expensive and perform poorly compared to projects from other regions. However, when classified into success and failure projects, the sub-Saharan Africa success projects’ investment costs are not significantly higher than from other regions. African countries like Ethiopia, which has embarked on an agricultural led development program, aspire to use irrigation as a development strategy with small scale irrigation playing a key role in rural development. This study evaluates the financial performance of small scale irrigation using O & M and investment recovery, and the ability to replicate the investments. It is concluded that the systems are financially viable and provide a low cost development option for rural areas., In Awulachew, Seleshi Bekele; Loulseged, Makonnen; Yilma, Aster Denekew (Comps.). Impact of irrigation on poverty and environment in Ethiopia: draft proceedings of the symposium and exhibition, Addis Ababa, Ethiopia, 27-29 November 2007. Colombo, Sri Lanka: International Water Management Institute (IWMI).

Ethiopia is an agrarian society in a land of drought and floods. Agricultural production, which is the source of livelihood for eight out of ten Ethiopians, is extremely vulnerable to climatic conditions. The causes of rural poverty are many including wide fluctuations in agricultural production as a result of drought, ineffective and inefficient agricultural marketing system, under developed transport and communication networks, underdeveloped production technologies, limited access of rural households to support services, environmental degradation and lack of participation by rural poor people in decisions that affect their livelihoods. However, the persistent fluctuation in the amount and distribution of rainfall is considered as a major factor in rural poverty. Cognizant of this reality the successive Ethiopian governments and farmers have made investments in small scale irrigation schemes. This paper aims to assess the efficacy of these investments in reducing poverty based on data obtained from a survey of 1024 farmers drawn from four major regional states of Ethiopia. The Foster, Greer and Thorbecke poverty measures were used to compare the incidence, depth and severity of poverty among groups of farmers defined by relevant policy variables including access to irrigation. In order to explore the correlates of rural poverty and their quantitative significance, logistic regression model was estimated. The main conclusion of the study is that the incidence, depth and severity of poverty is affected more by the intensity of irrigation use (as measured by the size of irrigated area) than mere access to irrigation. Alternatively, there seems to be an economy of scale in the poverty irrigation relationship., In Awulachew, Seleshi Bekele; Loulseged, Makonnen; Yilma, Aster Denekew (Comps.). Impact of irrigation on poverty and environment in Ethiopia: draft proceedings of the symposium and exhibition, Addis Ababa, Ethiopia, 27-29 November 2007. Colombo, Sri Lanka: International Water Management Institute (IWMI)

Farmers in rural Ethiopia live in a climate-related shock-prone environment. The major source of climate shock is the persistent variation in the amount and distribution of rainfall. The dependence on unreliable rainfall increases farmers’ vulnerability to shocks while also constraining farmers’ decisions to use yieldenhancing modern inputs, exacerbating the vulnerability of households to poverty and food insecurity. As a response, the Government of Ethiopia has embarked on massive investment in low-cost agricultural water management technologies (AWMTs). Despite these huge investments, their impact remains hardly understood. The main focus of this paper was to explore whether access to selected AWMTs, such as deep and shallow wells, ponds, river diversions and small dams, has led to a significant reduction in poverty and, if they did so, to identify which technologies have higher impacts. The study also calculated the net present value of the selected AWMT, to assess which of the AWMTs are worth investing in given that they have the promise of reducing poverty. In measuring impact we followed different approaches: mean separation tests, propensity score matching and poverty analysis. The study used a unique dataset from a representative sample of 1,517 households from 29 Peasant Associations (Kebeles) in four regions of Ethiopia. Findings indicated that the estimated average treatment effect on per capita income was significant and amounted to USD 82. Moreover, there was 22% less poverty incidence among users of AWMTs compared to nonusers. The poverty impact of AWMT was also found to differ by technology type. Accordingly, deep wells, river diversions and micro-dams have led to 50, 32 and 25%, respectively, reduction in poverty incidence compared to the reference, i.e., rain-fed systems. Although, the selected AWMTs were found to contribute to poverty reduction, we found that ponds, deep wells and small dams were not attractive from a social cost-benefit analysis perspective, implying that choices need to be made considering their relative financial viability and poverty reduction impacts compared to other available options that could improve rain-fed agriculture. Finally, our study identified the most important determinants of poverty, on the basis of which we made policy recommendations: i) build assets (AWMT, livestock, etc.); ii) human resources development; and iii) improve the functioning of labor markets and access to these (input or output) markets for enhanced impact of AWMT on poverty., In Awulachew, Seleshi Bekele; Erkossa, Teklu; Balcha, Y. (Comps.). Irrigation and water for sustainable development: proceedings of the Second Forum, Addis Ababa, Ethiopia, 15-16 December 2008. Colombo, Sri Lanka: International Water Management Institute (IWMI).