Addis Fortune (Addis Ababa)

Foreign exchange collected from horticulture exports during the fiscal year that just ended came to 216 million dollars, 61pc of the projected income of 354 million dollars.

Production of flower stems also showed a decrease with only 1.77 billion flower stems being produced, 66pc of the projected 2.75 billion stems.

"The majority of the projected income, which was expected to be collected from the export of 258.4 million dollars worth of flower stems fell short by 88.4 million to 170 million dollars," Haileselassie Tekie, director general of the Ethiopian Horticulture Development Agency, told Fortune.

However, when compared to the 2007/08 and 2008/09 fiscal years, the foreign exchange obtained from horticulture exports in the last fiscal year showed an increase of 71.4 million dollars and 51.1 million dollars, respectively.

When it came to the production of vegetables, fruits, and herbs, production surpassed projections, while the foreign exchange obtained from their export came in under the projected amount.

Production increased to 66,400tn from the projected 58,400tn, while the projected income of 95.7 million dollars fell by almost half to 46 million dollars.

"This is due to the fact that produce is easily perishable, and the fluctuation of its prices [also has an effect]," Haileselassie said.

The sector failed to cultivate 1,570ht of land, 33.3pc of the projected 4,717ht for 2009/10, according to a report by the Ethiopian Horticulture Development Agency.

On the other hand, the land utilisation during the last fiscal year showed an increase of 41pc and 54pc, respectively, when compared to 2007/08 and 2008/09.

Despite the failure to achieve the projected land utilisation this year, Tsegaye Abebe, chairman of the Ethiopian Horticulture Producers Association, is optimistic about future goals.

"We are planning to scale up land usage for horticulture to 33,000ht within five years," he told Fortune. "Out of this, 3,000ht will be for flowers, 15,000ht for vegetables, and another 15,000ht for the production of fruit."

Shortage of available land is not a major concern, according to Tsegaye.

"The shortage of land is not an issue; the government is fully engaged in helping this sector grow fast," he said. "The regional states of Tigray; Amhara; Oromia; and Southern Nations, Nationalities, and Peoples (SNNP) have made large plots of land available for investment in the sector."

Although some involved in the sector have failed to pay back their loans on time and were foreclosed, the Development Bank of Ethiopia (DBE), the sector's biggest lender, has had a good return on its loans to the sector, overall.

"The horticulture sector has been affected by the impact of the global economic downturn as well as inefficiency in the management of some projects," Esayas Bahre, president of the DBE, told Fortune.

So far, only four out of the 42 horticulture projects in the country have been foreclosed after failing to pay back their debts to the bank, with one in the process, he said.

However, the sector has generated foreign currency for the DBE amounting to 80pc of the 71.5 million dollars collected from the export of its debtors' products from the horticulture sector.

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