Since 2007, Ethiopia has achieved strong economic growth, making it one of the highest performing economies in sub-Saharan Africa. Yet it remains one of the world’s least developed countries, ranked 174 out of 187 in the 2011 UNDP Human Development Index and 76 out of 70 in the 2012 Global Hunger Index. About 29 per cent of the population lives below the national poverty line (IFAD 2012).

While Ethiopia has enormous potential for agricultural development, only about 25 per cent of its arable land is cultivated (IFAD 2012). Rain-fed agriculture employs 80 percent of the country’s 82 million people, forming the basis of Ethiopia’s economy (WFP 2012). The vast majority of these farmers are smallholders; about 12.7 million smallholders produce 95 percent of Ethiopia’s agricultural GDP (IFAD 2012). Household food security, particularly for these smallholders, is determined by rainfall patterns, land degradation, climate change, growing populations, low agricultural investments, and global market forces.

The 2011 Horn of Africa drought left an estimated 4.5 million people in need of emergency food aid. During the same period, cereal markets experienced a significant supply shock, causing food prices to rise substantially. Due to improved rains in 2012 and sustained humanitarian assistance, the overall food security situation has stabilized. However, the Humanitarian Requirements Document issued by the government and humanitarian partners in September 2012 estimates that 3.76 million people have required relief food assistance from August to December 2012. The total net emergency food and non-food requirement amounts to US$189,433,303 (WFP 2012).
In addition to negative weather shocks, Ethiopia’s rural poor also lack access to basic social services such as health care, schools, and safe drinking water. Households headed by women are particularly vulnerable.

Despite these challenges, however, Ethiopia has made significant gains in education, an expanded health extension system, and the fight against HIV/AIDS. The government’s long-term strategy of Agricultural Development-led Industrialization continues to address the country’s food insecurity and is complemented by Ethiopia’s Food Security Programme, which includes the Productive Safety Net Programme, the Household Asset Building Programme and others designed to ease households out of food insecurity. Ethiopia is also one of the fastest-growing economies, maintaining a growth rate of over 11 percent for the last five years (IFAD 2012).