Agriculture is the main stay of the Ethiopian
economy. It accounts for about 50 percent of the gross domestic product, provides
employment for 85 percent of the population, generates about 90 percent of the export
earnings, and it supplies about 70 percent of the country's raw material requirement for
large and medium sized industries that are agro-based. As per the National Accounts
estimates of agriculture, crop production is estimated to contribute on average around 60
percent, livestock accounts for around 27 percent and forestry and other sub-sectors
around 13 percent of the total agricultural value added.
Land is the basic resource for agriculture in which
farmers depend upon for their livelihood. The total land area of the country is about
111.5 million hectares of which about 66 percent is estimated to be suitable for
agriculture. Out of the total land suitable for agriculture, 16.5 million hectares of land
is estimated to be under cultivation for the production of annual and perennial crops.