Wednesday, June 12, 2024
BusinessEnergy crisis in Europe boosts flower exports

Energy crisis in Europe boosts flower exports

Due to limited output in Europe, flower shipments to European countries have skyrocketed in recent months. Europe’s energy crisis, brought on by the conflict between Russia and Ukraine, has wreaked havoc on the floral industry of European countries.

Lighting and heating costs for greenhouses in nations like the Netherlands, one of Europe’s major producers of fresh flowers and vegetables are getting quite high. Some farmers are simply giving up, while others are having trouble keeping up with declining yields. The executive board of the Ethiopian Horticulture Producers and Exporters Association welcomes the new development.

The Association’s executive director, Tewodros Zewdie, said that the crisis in European countries is bringing opportunities for Ethiopia, making the product the second biggest source of foreign currency next to coffee.

“The growers in Europe are now facing an energy crisis, which is an opportunity for us. Our air freight cost is even better than other producing countries like Kenya,” Tewodros said. “With the existence of Ethiopian Airlines and the strength of farms, we are in a better place now.”

During the first quarter of the current fiscal year, Ethiopia generated over USD 977 million from exports, achieving just 87 percent of the plan the government envisioned for the same period. Coffee exports accounted for more than 43 percent of total export income during the period, with 20,853 tons of coffee exported worth USD 426 million.

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While agriculture dominates with 81 percent of the performance, with coffee and horticulture being the major contributors, manufacturing follows with 9.6 percent and mining with 6.1 percent. Electricity and other exportable commodities cover the remaining share.

During the last fiscal year, flower exports to various destinations from Ethiopia were valued at USD 628 million, seven percent over what the government planned for the year.

Yinager Dessie (PhD), governor of the National Bank of Ethiopia (NBE), stated that exports of flowers and coffee have shown great performances during the first quarter of the fiscal year, unlike some commodities, including gold, crops, textiles, and leather products.

“Export trade was the main source of foreign currency,” he said. “We are doing a lot of different things to increase the share of exports in foreign currency supply.”

However, currency supplies, including grants and donations, have been drying up recently. About USD 1.7 billion was sourced from remittances, according to Yinager. Reporting his office’s quarterly performance to the House of Peoples’ Representatives (HPR) last Thursday, Yinager stressed the trade balance is still at a negative level.

Ethiopia imported goods worth USD 3.6 billion from July to the end of September, while exporting goods worth less than a billion dollars.

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