An image of the country's flag.

Ethiopia is the second-most populous country in sub-Saharan Africa with a population of 97 million people and a population growth rate of 2.5 percent in 2014. It is a large, ecologically diverse country with a rapidly growing population of 97 million people living in nine regions (Afar; Amhara; Benishangul- Gumuz; Gambela; Harari; Oromia; Somali, Southern Nations, Nationalities, and Peoples’ Region; Tigray) and two chartered cities (Addis Ababa and Dire Dawa). The nine regions are further subdivided into 68 zones comprising woreda (district) and kebele (municipal) administrations.

The country’s economy experienced strong and broad-based growth averaging 10.8 percent over the period 2003/04 to 2013/14, mainly the result of expansion in its services and agricultural sectors. The percentage of its population living in extreme poverty fell from 39 percent to 30 percent over a five- year period beginning in 2004-05. Over the past two decades, significant progress has been made with human development: primary school enrollment has quadrupled, child mortality has been cut in half and the number of people with access to clean water has more than doubled. However, continuing progress toward alleviating poverty and improving lives and livelihoods remain important challenges. The Government of Ethiopia (GOE) is already devoting a high share of its budget to pro-poor programs and public investment that is complemented by large scale donor support (World Bank 2016).

Ethiopia’s Second Growth and Transformation Plan (GTP II), 2015/16—2019/20 seeks to maintain this momentum and elevate the country to lower middle income status by 2025 by achieving an annual average real GDP growth rate of 11 percent within a stable macroeconomic environment while at the same time pursuing aggressive measures toward rapid industrialization and structural transformation. It aspires to achieve these objectives via the following pillars (GOE, National Planning Commission, 2015):

  1. Sustaining the rapid, broad based and equitable economic growth and development of the last decade including GTP I;
  2. Increase productive capacity and efficiency by rapidly improving the quality, productivity and competitiveness of its agriculture and manufacturing industries;
  3. Enhance the transformation of the domestic private sector to enable them to become a more capable development force;
  4. Build the capacity of the domestic construction industry, and bridge critical infrastructure gaps with particular focus on ensuring quality provision of infrastructure services;
  5. Proactively manage the on-going rapid urbanization to unlock its potential for sustained rapid growth and structural transformation of the economy;
  6. Accelerate human development and technological capacity building and ensure its sustainability;
  7. Continue to build democratic and developmental good governance through enhancing implementation capacity of public institutions and actively engaging citizens;
  8. Promote women and youth empowerment, ensure their effective participation in the development and democratization process and enable them to equitably benefit from development; and
  9. Build a climate resilient green economy.

Ethiopia’s economy depends on the productivity of its natural resources, principally land and water. Through their use, agriculture contributes 42 percent of Ethiopia’s GDP. Governance of these resources is shared between the federal government and nine ethnically based regional governments. The decentralized approach to government extends public sector oversight and involvement to district (woreda) and local (kebele) levels. Relative to the 2004-06 base period, aggregate crop and livestock production had, by 2013, increased 57 and 30 percent respectively, the outcome of public investment in infrastructure, market development and institutional reform.

Notwithstanding these gains, the country continues to face important macroeconomic and political development challenges. Per-capita income remains among the world’s lowest. Many young people leave to seek opportunity elsewhere. While agriculture is an important contributor to GNP, it remains vulnerable to droughts and external shocks.

Since 2005, Ethiopia has achieved strong rates of GDP growth, in part due to good weather conditions, and because of the significant attention government has dedicated to boosting agricultural productivity, exports, and rural investment through public investment in roads, irrigation, and market facilities. As noted, Ethiopia’s economy is heavily dependent on agriculture which accounts for 42 percent of GDP and 90 percent of exports in 2014 (USG 2015). Coffee, livestock and gold dominate exports, although Ethiopia’s floriculture sector (which emerged in the late 1990s) has become the second largest flower exporter in Africa after Kenya with exports expected to reach $550 million by the end of 2016 (East Africa Business Week, 2015).

Although Ethiopia’s highland areas and rivers feed the Blue Nile as it flows north to Egypt, its use of this water for hydropower generation and irrigation is still limited, in part due to decades-old agreements with neighboring Sudan and Egypt. However, the GOE in 2011 announced plans to build four large dams on the Nile, including the Grand Ethiopian Renaissance Dam (formerly Grand Millennium Dam) with a storage reservoir of 1,561 km2 and potential of generating up to 6,000 MW of electricity (making it the largest hydroelectric power plant in Africa when completed); as of October 2014, the dam was 40% complete (International Rivers, n.d.). Similarly, the GOE plans to increase irrigated acreage substantially (see Section 2 below).

Land certification (registration) to promote individual land use rights has been tested and expanded to millions of households nationwide, with generally positive results, although critics believe that more must be done to enhance tenure security and stimulate greater economic investment at the local level. However, while the government has made substantial headway advancing certification in the highland areas, land is still not easily transacted, it can be expropriated for public use without compensation or due recourse, and development and investment patterns remain severely constrained by public financial and organizational capacity.

The federal government has also been successful in attracting foreign and domestic investors to the agricultural sector, but long-term leasing of community lands in lowland areas has been criticized for having ignored the property rights of local communities, especially to pastureland, forest resources and seasonal water sources. While such investment holds promise for increasing agricultural productivity, creating jobs, and improving management know-how and capital, achievement of these outcomes in practice has been mixed and livelihoods of the poor and disadvantaged are sometimes being threatened. Efforts are now underway to expand certification to pastoral communities in lowland areas via group certification. There nonetheless remains lack of clarity or assurance regarding the rights of many peasants, pastoralists, women and others to manage, access, or use land, forest, water, and mineral resources upon which they depend for their livelihoods. Conflict between government and communities has been on the rise as government expropriates land for urban expansion, infrastructure, irrigation, resettlement and investment.

Agricultural development in Ethiopia continues to face formidable challenges. Average farm sizes are small with 87 percent of farming households in 2000 operating less than 2 hectares (ha) and 41 percent operating 0.5 ha or less (Future Agricultures, 2006). Since the 1980s, Ethiopia has been a major recipient of emergency food and cash assistance from the international community. Highly variable rainfall patterns have resulted in recurrent drought and crop/livestock loss, while in good years, markets have been unable to absorb surplus production. Establishment of the Ethiopian Commodity Exchange in 2008 is now helping to mitigate production shortfalls and better manage surpluses by reducing costs between producers and consumers via improved market information, market coordination, and open price discovery using auctions (Ethiopia Commodity Exchange, n.d.). Nevertheless, smallholder crop yields are below regional averages, market linkages are weak, the use of improved seeds, fertilizers and pesticides remains limited, only 6 percent of cultivated land is currently under irrigation, and child undernutrition rates are among the highest in the world (USG 2015). Issues of land access and land rights influence or are impacted by all these constraints.

As one reviews this brief, it is important to keep three important caveats in mind. First, in Ethiopia, regions have considerable autonomy to develop their land use policies and administration systems consistent with federal law and policy. Land interventions, whether they be proclamations, policies, systems or programs implemented are geographically dispersed and nuanced. Second, because of widely differing capacities at the national and regional level and rapid changes in the land dynamic in Ethiopia, information can fall out of date quickly or not be known with certainty due to constraints in knowledge management systems and communications. Third, land issues and intervention can vary regionally. For example, household level certification is widespread in the highlands, community level certification has shifted to pastoral regions and forest zones, and commercial land acquisition is focused on good agricultural land with reliable access to rivers. This profile here possible or known, tries to make clear these regional distinctions, however, the reader is cautioned to avoid geographic over-generalization.


Secure land and property rights and good governance are fundamental to economic growth, peace and stability, and environmental sustainability. The following are selected interventions identified and expanded upon in the remainder of this Brief that will hopefully guide future land tenure reform in Ethiopia toward these outcomes:

  • Extending and supporting land certification. Donors should continue to support land certification in arable and pastoral settings by harmonizing the legal and regulatory framework between federal and regional levels; deepening this harmonization in pastoral regional states that were late in developing their proclamations; supporting rights awareness campaigns to improve landholder understanding of the rights they hold; improving the capacities of land administration authorities to demarcate, register land and store and manage land records; supporting the piloting of certification initiatives in pastoral areas to communities as legal entities; strengthening the role of women and minorities in group registration efforts to promote good governance; and broadening women’s participation in land administration. These actions would be consistent with the GOE’s Growth and Transformation Plan II, 2015/16—2019/20. It will be essential for the government to develop a land administration system which is fit for purpose to meet the basic needs of the majority, then “improves” over time with demand. Otherwise, there is risk that government-led certification will be inappropriate (technically and financially) for the use and user at hand. Fit for purpose should take into account needs related to social inclusion, costs consistent with anticipated benefits and system reliability and efficiency to help ensure sustainability.
  • Build the capacity of land administration institutions. Donors should support efforts improving the capacity of land administration institutions to make sure that land laws are enforced and land administration services are provided. Special attention needs to be given to updating land records when transactions occur—this remains a threat to the sustainability of the land certification system. The rural cadaster will rapidly become outdated if this is not done on a timely basis. An emphasis on computerization, one-stop-shopping, low transaction fees, a customer service orientation and prorating fees for “fit for purpose” are helpful in this regard.
  • Strengthen and improve land rental markets. Donors should support efforts to broaden rights and facilitate land leasing and rental markets to lower transaction costs and provide landholders with greater security in land market transactions, as a means to promote economic growth.
  • Address the need to improve the expropriation policy and framework. Donors should assist government with developing a functional expropriation/compulsory land acquisition policy that ensures full and open consultations with stakeholders affected by land takings for public purposes, ensures fair compensation, and provides due recourse to facilitate investment in public goods while protecting rights of affected populations. Further, with regard to large-scale land acquisitions, the GOE should support the development of a policy to improve land management and secure land rights, building upon recommendations such as those provided by GIZ: 1) establish transparency and a credible and reliable information base; 2) strengthen the monitoring and negotiating functions of civil society; 3) review the existing international legal framework; 4) develop and implement international guidelines; 5) support and maintain political dialogue; and 6) establish security through land laws, policies and enforcement in developing contracts between communities and investors (Graefen 2015).
  • Support integrated land use planning and participatory resource management. Donors should support initiatives aimed at preparing and implementing integrated land use planning at all levels. They should further support initiatives aimed at devolving authority or facilitating participatory resource governance including deepening participatory forest management (PFM), supporting property rights and value chains of artisanal and small scale miners in mineral extraction, strengthening governance structures and empowerment of communities in negotiations with investors, and providing support to government ministries and regional bureaus to promote decentralization and service delivery.
  • Build capacity of pastoralist communities and water users’ groups and support community land rights formalization. Donors should work to improve the capacity of pastoral and water users’ groups to understand commercial investment and the GOE’s policy related thereto. Further work with government, investors and communities on negotiating land transactions that are pro-growth and equitable and better serve the interests of all parties involved is required. This should include assessing pastoral land rights, formally securing those rights via community or group certification, identifying membership, developing constitutions or community charters that secure members’ rights and clarifying transferability, undertaking community mapping that relate rights to physical land boundaries, and developing land and resource plans to improve land resource management for improved livelihoods, resilience and sustainability.


Ethiopia covers an area of 1,104,300 square kilometers. Of its total land area (100.0 million ha excluding inland water bodies) in 2013, 36.3 percent was agricultural land, 15.2 percent was arable, 1.1 percent was permanent cropland (mainly coffee and horticulture), 20.0 percent was permanent pastures, and 12.4 percent was forested. Only 164,600 ha was irrigated in 2011, or 0.5 percent of agricultural area. Terrestrial protected areas encompassed 18.4 percent of Ethiopia’s land area in 2012 (Knoema World Data Atlas). An estimated 19 percent of Ethiopia’s 97 million people live in urban areas, making it one of the least urbanized countries in the world, highlighting the importance of land access for rural livelihoods.

Agriculture accounts for about 42 percent of GDP and 80 percent of the population gains its livelihood, directly or indirectly, from agricultural production. Of the total value of agricultural production of $11 billion in 2012, crop and livestock production comprised 81.5 percent and 18.5 percent respectively; of total crop value, cereal production comprised 54.4 percent. Over the 2007 to 2013 period, cereals production rose steadily from 12.2 to 22.7 million tons, roots and tubers from 6.3 to 8.5 million tons, oilseeds from 188.0 to 246.8 thousand tons, and vegetables from 1.11 to 1.9 million tons (Knoema 2013), all contributing to growing food security.

Oilseed production, while important for local consumption, is also expanding rapidly due to increasing exports to the Middle East and China; exports increased ten-fold between 2002 to 2012 (Knoema 2013). Ethiopia is reputed to be the origin of Arabica coffee that is in great demand in European, US and Japanese markets. Ethiopia’s floriculture and horticulture export sector industry is growing rapidly with exports of flowers mainly to European destinations. The Government is actively encouraging smallholder and commercial agriculture to produce coffee, oilseeds, pulses, flowers and vegetables for export. Coffee is the major foreign exchange earner, generating about 31 percent of total merchandise export earnings in 2012, with oilseeds and pulses adding another 17 percent. Other major exports include natural gums, khat, vegetables, cotton and gold.

The livestock sector contributes an estimated 12 percent to total GDP and 45 percent to agricultural GDP; pastoral livestock population is an estimated 40 percent of total livestock production. In 2010, total livestock numbers included 52 million cattle, 3.3 million sheep, 30 million goats, and 2.5 million camels. Of these totals, 30 percent of cattle and sheep, 70 percent of goats, and 100 percent of camels were situated in pastoral areas of Afar, Somali, SNNP, Oromia, Diredawa, Benishangul-Gumuz and Gambela regional states (Shitarek 2012). Processed and semi-processed hides and skins are the second most important foreign exchange earner; Ethiopia was the largest producer of livestock in Africa in 2010-11 and the largest producer in the world after Brazil and Vietnam (MoARD 2010). However, livestock’s contribution to GDP is underestimated because of some of its economic benefits are excluded—notably livestock draft power. Taking these benefits into account would double the official value of livestock’s contribution to GDP. The same applies to export; livestock products probably constitute a fifth of Ethiopia’s exports, but about half of these exports are not officially recognized because of informal cross border trade (ICPALD 2013).

Despite the importance of livestock to the agricultural sector, the claims of pastoralists to land and pasture, particularly in the South, are poorly recognized or upheld by Federal, regional, or state authorities, although this is changing. Conflicting claims on grazing resources have been a contributing factor to violent clashes. The expropriation of pastoral lands for infrastructure, town expansion, investment and irrigation, often without fair compensation, consultation or exercise of due recourse, has divested communities of valuable land and resources and weakened their resilience to natural shocks (Hundie and Padmanabhan 2008; Beyene and Korf 2008).

While the estimated contribution of the forest estate to GDP is only 2.8 percent, 90 percent of the population relies on various forms of biofuels. Use of non-timber forest products such as honey, medicinal and spice plants, fodder, and the benefits of environmental services are essential aspects of people’s livelihoods. Forest clearance for agricultural expansion and settlement, habitat fragmentation, and the impact of uncontrolled grazing and fire upon forest regeneration are all drivers of deforestation in Ethiopia. Encroachment on state forest reserves and associated illegal logging and arson are significant problems.

Ethiopia produces various types of minerals such as gold, silver, gemstones, soda ash, tantalum, kaolin, construction materials, particularly colorful dimension stones, and mineral water. Most minerals are mined by artisanal and small-scale miners (ASM). It is estimated that more than one million people are engaged in ASM activities, and 5-7 million people indirectly benefit.

Published / Updated: November 2016

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