Saudi Billionaire To Invest $100 Million In Ethiopian Farm

Saudi Billionaire To Invest $100 Million In Ethiopian Farm

From Business Week

Saudi Star Agricultural Development Plc, an Ethiopian company owned by billionaire Mohamed al-Amoudi, said it plans to invest $100 million in a rice farm in western Ethiopia next year to kick-start the stalled project.

The company leased 10,000 hectares (24,711 acres) in the Abobo district in the Gambella region, where it’s based, in 2008 and bought the 4,000-hectare Abobo Agricultural Development Enterprise from the government 18 months ago for 80 million birr ($4 million). After delays caused by unsuitable irrigation design and contractor performance issues, Saudi Star wants to accelerate work in 2015 after a change of management, a redesign of the farm and a successful trial of rain-fed rice on 2,000 hectares at the formerly government-owned operation, Chief Executive Officer Jemal Ahmed said by phone.

“We have a very aggressive plan,” he said on Nov. 26 from Jimma, about 260 kilometers (162 miles) southwest of the Ethiopian capital, Addis Ababa. “If we’re able to do that we’ll be able to produce more.”

The project is part of a government plan formalized in 2010 to establish commercial farms on 3.3 million hectares of fertile land in sparsely populated parts of the country such as Gambella. Ethiopia expected to earn $6.6 billion a year from agriculture exports in 2015, according to a five-year economic plan published in 2010, though total goods exports last fiscal year brought in $3.3 billion.

Prime Minister Hailemariam Desalegn said in October 2013 that progress on the program had been “very slow.”

Billionaire Investor

Ethiopia-born al-Amoudi is worth $8.1 billion, according to the Bloomberg Billionaires Index, which ranks him as the world’s 157th richest person. His company built underground oil-storage facilities in Saudi Arabia and he owns Preem AB, Sweden’s largest crude oil refiner. Al-Amoudi is increasingly investing in formerly government-owned farms in Ethiopia, a nation where companies under his Midroc group operate the only commercial gold mine and built the largest cement plant in 2011.

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