Saudi Billionaire to Invest $600 Million in Ethiopia Cooking Oil

Addis Ababa, Ethiopia – An Ethiopian company majority-owned by Saudi billionaire Mohammed al-Amoudi plans to invest $600 million over two years to produce edible oil, its general manager said.

Horizon Plantations Ethiopia leased a 20,000-hectare (49,400-acre) plot in the northwestern Benishangul-Gumuz region last month to grow groundnuts, as part of a government drive to boost commercial agriculture, Jemal Ahmed said in an interview on April 3 in the capital, Addis Ababa.

Ethiopian-born al-Amoudi, who is ranked by Forbes magazine as the world’s 63rd-richest person and was worth $12.3 billion in March, owns 80 percent of the company, according to Ahmed.

The Horn of Africa nation imports up to 250,000 tons of palm oil a year from Malaysia, at a cost of more than $300 million, said Jemal, whose company Ahfa Pvt. Ltd. used to be one of the top five importers of the product. “We want to substitute that with this project.”

At full capacity, Horizon’s farm, which may be ready for planting next year, should produce 150,000 tons of oil a year from a processing plant in Bahir Dar city in Amhara region, according to Jemal.

Ethiopia’s Agriculture Ministry has transferred 100,000 hectares in Benishangul to commercial farmers as part of the agriculture project, and is offering a further 981,000 hectares, about one-fifth of the state’s land. Nationwide, the government says it plans to increase a land bank that sets aside 3.6 million hectares of Ethiopia’s total 110.4 million hectares for commercial farming.

‘Barren Land’

The four-year-old program has forcibly relocated more than 1 million Ethiopians in the south and east of the country, according to the California-based advocacy group Oakland Institute. The government rejects the allegation.

Horizon’s river-irrigated plot, which it says the government will increase to 35,000 hectares when 10,000 hectares of the initial area is cleared, is “barren land,” according to Jemal. “There are no human beings living in it,” he said.

Last month, the Addis Ababa-based company bought Gojeb Agricultural Development Enterprise in the southern region from the government for 35.1 million birr ($2 million), Jemal said. It plans to grow bananas and pineapple for export on 1,500 hectares. Horizon jointly runs the nation’s largest coffee estate, Bebeka, with the government in southwest Ethiopia, he said.

Al-Amoudi’s companies also won bids for four other state- owned enterprises, including the nation’s largest orange-grower, Upper Awash Agro-Industry Enterprise, Privatization Agency spokesman Wondefrash Assefa said on March 29.

Source: Bloomberg