How to reduce agrifood systems' future hidden costs? A multicountry case study

Getaneh, Y.; Nigussie, Y.; Abera, W.; Mulatu, K.; Balcha, Y.; Tibebe, D.; Eshete, M.; Mekonen, B.; Tamene, L. (2024) How to reduce agrifood systems' future hidden costs? A multicountry case study. [Chapter 5: Ethiopia]. In Fable Consortium. State of Food and Agriculture (SOFA) 2024 Background report. 20 p.

Despite the significant role of agriculture in Ethiopia's economy, the economic damage caused by negative externalities within the agri-food system has been largely unknown due to the intangible nature of these impacts. This research aimed to evaluate the evolution of hidden costs in Ethiopia's agri-food system by leveraging the 2023 FAO-SOFA flagship report through literature review, stakeholder consultation, and FABLE-based modeling. The total hidden costs of Ethiopia's agri-food system were estimated to be 51 billion 2020 PPP dollars per year. The most significant contributor to these hidden costs was the social sector, particularly poverty among agri-food workers, accounting for 24.3 billion 2020 PPP dollars annually. Environmental externalities related to climate change and land-use change were the second-largest contributors, reaching 19 billion 2020 PPP dollars per year. Specific recommendations to reduce hidden costs include a lower population growth path, decreasing livestock numbers, and increasing crop and livestock productivity.