How does the project support Ethiopia in promoting the decent work agenda?

The agriculture sector is the backbone of the Ethiopian economy involving the major source of employment and lion’s share of the Gross Domestic Product (GDP). It remains the main sector in employment (68% in 2017) though its GDP share has reduced from 34% in 2010-2011 to 17.5% in 2017/2018. According to 2018 estimates, the agriculture sector accounts for over 84% of the export and earns over 73% of the foreign exchange. The agricultural sector in Ethiopia relies on an interconnected network of informal and formal micro, small, medium and large enterprises.

The ProAgro Ethiopia project funded by the BMZ’s Special Initiative on training and job creation, aims to create decent employment opportunities by focussing on skills and enterprise development in the agri-business sector by targeting young people and women. It is a 3.5 years project rolled out in 2020 with a budget of 5.6 million USD.

Socio-economic and political changes in the country since 2020 have had a severe impact on the national economy. The double jeopardy of the pandemic and humanitarian crisis in the north (which has now spilled into different parts of the country) have impacted the local labour markets. In the background of this scenario, ILO Ethiopia is committed to working together with the Government of Ethiopia in promoting the decent work agenda in partnership with its tripartite constituents and providing a fillip to the agro-business sector which is also a national priority.

How exactly will the project contribute to the creation of more and better jobs in the agribusiness sector as well as other targeted sectors? Can you explain the approach?

ProAgro Ethiopia project aims to contribute to the creation of more and better jobs in the agri-business sector in Ethiopia by employing a project strategy that is articulated around the four key priorities of i) supporting job-rich, sustainable private investment in target areas ii) social dialogue and collective bargaining, iii) skills development and governance, iv) fostering dynamic, employment-rich, agribusiness value chains and entrepreneurship development

• The first priority will support engagement with investors (foreign and domestics), links with intermediation and TVET institutions as well as with private sector actors. The project will seek to support the capacity of investment promotion agencies to influence and monitor the jobs intensity of investment and to mainstream decent work and incentive packages. Focus on strengthening labour market information systems, both at the regional and sectoral level to serve both the local employment ecosystem and provide updated information to potential investors by setting up employment services to ensure that the job seekers are best matched to the needs of the enterprises.

The focus will also be on the quality of jobs that are created by supporting the capacity of job creation and investment promotion agencies to:
1. Measure the number and quality of jobs created by foreign and domestic investment projects.
2. Strengthen monitoring mechanisms, to ensure that investment incentives are conditional to decent job creation
3. Mainstream decent work issues in incentive packages and regulations

• The second priority is on supporting the ILO constituents to identify and address key decent work deficits through social dialogue. The project will promote decent wages and working conditions in the target areas by capitalizing inter alia on the experience of the ILO on promoting principles of collective bargaining and social dialoguing at the enterprises level.

• The third priority will focus on making young women and men more employable, providing them with the skills demanded by the agribusiness sector through enhancing skills governance. Additionally, it seeks to develop the capacity of TVET service providers to enhance their training quality and tailor their offerings to labour market needs and provide support to the Sectoral Skills Council (SSC) to better govern the skills system and develop industry-based regional or national policies and recommendations.

• The fourth priority will foster dynamic, employment-rich, agribusiness value chains and entrepreneurship development by undertaking market system analyses to identify the underlying constraints to value chain performance. Interventions will be aimed both at creating new jobs in the target value chains and improving the quality of existing jobs, through higher and more stable incomes. The project will collaborate with market leaders to introduce new business models and product niches in the value chain, foster linkages between local SMEs and larger international and national investors and support financial service providers in developing new product ranges to favour innovation and productivity growth in the target value chains, support tripartite advocacy for value chain specific business environment reform and particular attention will be given to promoting an enabling environment for MSME development, with reference to sectoral policies and value chain specific regulation. Interventions under this priority will be closely linked to skills and entrepreneurship by identifying skills gaps and potential niches for entrepreneurship promotion.

On which particular sectors and regions will the project focus?

The project is working in the agribusiness sector and covering the three subsectors of poultry, fruits and vegetables and edible oils in the two regions of Amhara and Sidama in Ethiopia. These sectors and regions were chosen through an overarching criterion that was set comprising of ‘relevance to the target group’, ‘opportunity for the sector to grow inclusively’ and ‘feasibility for the project to drive change’. The choice of subsectors and regions were further validated and confirmed in consultation with the tripartite constituents and stakeholders.

What can we expect to see at the end of this project in Ethiopia?

At the end of this project, it is expected that in the agribusiness sector in Ethiopia, there would be more people with decent employment, many would have benefitted from improved working conditions and improved incomes, many would have participated in relevant vocational and employability skills trainings and finally that enterprises would have engaged on matters of enhancing labour productivity, minimum wages and betterment of occupational, health and safety standards.