Effectiveness Assessment on Overseas Farm Land Investments in Ethiopia

Abstract

The wave of acquiring large-scale farmland investments for overseas both by the private and state-owned company after the 2007/2008 food and energy crisis has brought a lot of attention worldwide among scholars, media experts, and activist. Sooner or later this huge wave towards overseas large-scale farmland investment has raised a conflicting debate among scholars and developmental practitioners on its significance. In this study we investigate effectiveness levels of those overseas farmland investors, who acquire land in Ethiopia from 1995-2016, using time series data for said period collected from the databank of Ethiopian investment agency. We applied descriptive and inferential statistical analysis using E-views version-9. Finally, the findings indicate that effectiveness of overseas farmland investments for those projects that possess the license and that got the land is about 67.4 per cent. The regression result indicates as there is a significant relationship between origin of the investor’s country (0.0039) and farm land size (0.0000) with a P value less than 5 per cent. The result indicates and also substantiates those who perceive the activity as more of land acquisition that the investors are failed to invest appropriately after they possessed the land. Finally, the findings greatly contribute for policy makers and also for implementing appropriate land investment strategy in the whole.