PROJECT

FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

Project Number (SAP ID): 130306

Project Title: Slaughterhouse waste management: the sustainable and productive use of
animal by-products

Starting Date: 2015

Duration: 4 Years

Government Coordinating Agency: Ethiopian Meat and Dairy Industry Development

Institute

Host Country Counterpart: Ministry of Industry

Executing Agency: United Nations Industrial Development Organization (UNIDO)

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EXECUTIVE SUMMARY

The Federal Democratic Republic of Ethiopia through the Ministry for Industry has requested
technical assistance from UNIDO to address the environmental challenges arising from
slaughterhouse wastes. The request from the Ethiopian Government outlined a serious
environmental ‘problem’ relating to slaughter house wastes where disposal through open
burning, discharge to waterways and informal unsanitary landfill was provoking justifiable
environmental and public health concerns. The request for technical assistance arises in the
context of the Ethiopian Growth and Transformation Plan [GTP] which looks to agriculture
and agri-business as the growth engine to create prosperity and employment opportunity
for a population that is growing at a rate of 2 million per annum. Slaughter- house wastes
are a by-product of the Ethiopian livestock and meat value chain, which is ranked 10th global
meat producer by volume and the largest in Africa but only holds 15% of the African meat
market share. World markets are generally closed to Ethiopian meat because of livestock
health concerns and the absence of a traceability system.
The GTP includes measures designed to access international meat markets where currently
only 3.3% of the Ethiopian annual livestock kill is exported as value added packaged/ frozen
meat product.
Moving from the premise that this environmental ‘problem’ [as defined] is in fact the loss of
a valuable economic resource, UNIDO proposes a closed loop eco-effective approach to
exploiting this resource in a way that complements Ethiopian development policy. The
UNIDO response will complement the GTP by intervening in the currently underdeveloped
meat by-products segment to promote the establishment of a rendering industry to
generate products and semi-products for downstream industrial manufacture of a spectrum
of industrial and food products.
The project will support the creation of a pilot animal by-products value chain, with
traceable linkage to the national livestock value chain, to develop products and semi-
products as raw material for the industrial manufacture of a spectrum of commercial
products from animal feedstuff to industrial fats, oils and greases to soaps, cleaners and
detergents to cosmetic products to gelatin for local demand and international markets.
The project will have two key components:
 Capacity building and institutional development for key Government institutions and
private sector actors in the meat by-products value chain
 Investment promotion to establish a pilot rendering plant and market driven
manufacturing of commercial products from raw material or semi-products derived
directly from animal by-products or from the rendering of such materials promoted
and facilitated.
The project activities will range from technical feasibility and design studies, to the
integration of policies and management systems and from capacity building through trade,
investment and technology promotion throughout the pilot value chain to include
investment in rendering and manufacturing of commercial product.
The project will provide a foundation for an industrial sector that will link primary
agricultural production to secondary industrial manufacturing, which is one of the keystones
of the GTP. The project will benefit from the coordinated and focused expertise and
experience of several UNIDO technical branches led by the Environmental Management
Branch and will have linkage to an international advisory body of experts.
The manufacture of high quality raw materials from traceable animal by products can be
foundation of an internationally competitive industrial sector based on the manufacture of
products from rendered animal by-product and through the creation of value added and
employment generation the project will play its part in achieving inclusive sustainable
industrial development [ISID] in Ethiopia.

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TABLE OF CONTENTS

BACKGROUND AND JUSTIFICATION

PROGRAMME FRAMEWORK
PROJECT STRUCTURE
COMMERCIAL USE OF ANIMAL BY PRODUCTS
PROJECT OBJECTIVE, OUTCOMES, OUTPUTS AND ACTIVITIES
PROJECT ORGANISATION
IMPLEMENTATION
MONITORING AND EVALUATION PLAN
BENEFICIARIES
RISKS, OPPORTUNITIES AND SYNERGIES
SUSTAINABILITY
PROJECT LOGICAL FRAMEWORK
BUDGET

FIGURES
Figure 1
Baseline: Ethiopian Meat Value Chain 2014
Figure 2
Strategic Vision: Programme Framework
Figure 3
Pilot Value Chain
Figure 4
Project Organization

LIST OF ACRONYMS AND ABBREVIATIONS

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BACKGROUND AND JUSTIFICATION

With a population of 78 million people and growing by around 2 million people annually
Ethiopia is currently undergoing rapid economic transformation triggered by the macro
economic reforms and is currently experiencing an annual GDP growth in the order of 10%,
albeit from a very low base. The Ethiopian economy is largely based on agriculture, which
accounts for 46% of the gross domestic product and 85% of total employment. Almost 50% of
Ethiopia's population is under the age of 18, and even though education enrollment at
primary and tertiary level has increased significantly, job creation has not caught up with the
increased output from educational institutes. The country must create hundreds of thousands
of jobs every year just to keep up with population growth. Ethiopia’s Growth and
Transformation Plan [GTP] 2010-2014 is the national economic and social development plan
with a total cost estimate at US$ 75-78 billion over five years. In this non-oil economy the
engine for economic and social development is agriculture and agro industry with the GTP
supporting institutional capacity and good governance, creating an enabling environment for
industrialization, expanding infrastructure, promoting gender and youth empowerment and
ultimately the creation of employment; which lies at the core of inclusive development. A
new GTP is currently being formulated and will commence in 2015 for a further 5 years.
This project contributes incrementally to the GTP by focusing on the meat sector, which is a
significant segment of agriculture and agro industry in the country. Ethiopia is the 10th largest
producer of meat in the world and the biggest in Africa while it only constitutes 15% of the
African Meat Market Share. The annual production of meat is 750,000 m/t [2013] almost
exclusively for the domestic market. The export trade is mainly live export to neighboring
countries with a significant amount of illegal or informal export of live animals. Actual meat
export is limited to 18,000 m/t annually 90% being small ruminants [sheep/goats] and 10%
being beef. The meat export trade represents only 3.3% of total annual kill. [Figure 1]
The critical development challenge facing the Ethiopian meat sector is international market
access, which is generally denied because of the prevalence of disease in the national herd,
which inhibits export to countries that demand veterinary certification and food chain
traceability. This barrier to international trade severely curtails the value chain and inhibits
the potential of the Ethiopian meat sector to contribute to national inclusive sustainable
industrial development consistent with the GTP objectives. The only countries that currently
allow the limited import of Ethiopian meat and meat products are Saudi Arabia, the Arab
Emirates and some Gulf States including Yemen. This limited access is provided for customer
supervised halal meat.
Based on calculations from countries where the meat sector is well developed, Ethiopia is
also loosing out on the economic resource potential of up to 300,000 MT [annually] of
animal by products which are currently being disposed as waste in the absence of a
functioning animal by products rendering industry with all the associated environmental
consequences and health risks. [Figure 1]
The rendering industry processes animal by products to produce tallow, greases, oils, acids
and bone chips as raw material for a wide ranges of industrial applications. The original
request from the Ethiopian Government to UNIDO outlined a serious environmental
‘problem’ relating to slaughter house waste where disposal through open burning, discharge
to waterways and informal unsanitary landfill was provoking justifiable environmental and
public health concerns.
This project adopts a ‘closed-loop’ eco-effective approach to exploiting this valuable
resource in a way that complements Ethiopian development policy and creates a material
base for downstream industrial manufacturing. Through the creation of value added and
employment generation the project will play its part in achieving inclusive sustainable
Industrial development in Ethiopia

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Figure 1
BASELINE
ETHIOPIAN MEAT VALUE CHAIN 2014

PROGRAMME FRAMEWORK

The Ethiopian Growth and Transformation Plan [GTP] underpins a strategic development
programme framework at national level that supports the agricultural and agro-food sector
and in particular the primary livestock production value chain to move towards
internationally acceptable standards of traceability in order to gain competitive international
market access. The ultimate goal is to move from the current meat export level of 18,000
MT annually to 350,000 MT or 50% of national production.
The programme is designed to accelerate industrialization; to take advantage of
globalization and crucially to create employment as the bedrock of inclusive sustainable
industrial development in Ethiopia.
The programme framework provides an opportunity to UNIDO to complement the GTP by
intervening in the currently underdeveloped meat by-products chain segment to promote
the establishment of a national rendering industry to generate products and semi-products
for industrial manufacture of a spectrum of industrial and food products. [Figure 2]
The manufacture of high quality raw materials from traceable animal by products is the
foundation of an internationally competitive industrial sector based on the manufacture of
products from rendered material. Each individual manufactured products demands different
degrees and ranges of quality assurance from relatively low [e.g. industrial greases] to
extremely demanding [e.g. food quality gelatin].
The programme itself demands large scale investment from the Ethiopian Government
supported by international donors including the European Commission, World Bank Group
and the private sector in order to realize large scale impact on Ethiopia’s Industrialization
process by addressing nationwide regulatory, infrastructural and institutional challenges.
The technical competences of several UNIDO branches, executed as individual inter-linked
projects can be rolled out along the value chain either to complement the GTP activities or,
as in this case, to initiate incremental actions in parts of the value chain that are not directly
targeted by the GTP.

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Figure 2
STRATEGIC VISION
PROGRAMME FRAMEWORK

PROJECT STRUCTURE

The project will support the development of a pilot value chain centered on the potential of
the animal by-products arising from slaughtering and meat processing to manufacture
industrial raw material as the feedstock for a yet undeveloped industrial sector in Ethiopia.
The pilot value chain will consist of three keystone foundations namely:
 A supply of traceable animal by-product from export oriented abattoirs
 An industrial animal by-product rendering capability
 A capability to industrially manufacture products from animal by- products for local
demand and international markets
Figure 3 [below] illustrates the proposed project value chain with upstream linkage to the
livestock supply chain through export oriented abattoirs, to a rendering plant that has the
capacity to supply a range of raw materials including tallow, meat meal, oils, greases, acids
and bone chip to downstream manufacturers either at national level or to the international
market.

COMMERCIAL USES OF ANIMAL BY-PRODUCTS

The following illustrates just some of the commercial uses of materials recovered from
animal by-products not intended for human consumption.

 Calcium hydroxyapatite: Crushed bone and bone marrow. It is used as a fertilizer.

 Collagen: A protein made up of amino acids, which are in turn built of carbon, oxygen
and hydrogen. Used widely in cosmetic surgery and as wound healing aids in burn
patients and for reconstruction of bone and a wide variety of dental, orthopedic and
surgical purposes.

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 Gelatin: Food and Non Food Applications of Gelatin
 Non-edible tallow: Used in wax paper, crayons and soap
 Oleic acid: Used in foods, soaps, permanent wave solutions, shampoos, hair dyes,
lipsticks, liquid make-ups, nasal sprays
 Glycerin: Used in inks, glues, solvents, antifreeze, cosmetics, foods, mouthwashes,
toothpastes, soaps, ointments, plastics
 Stearic acid: Used in rubber, cosmetics, lubricants, candles, hair spray, conditioners,
deodorants, creams, food flavoring, pharmaceutical products
 Linoleic acid: Used in paints and esters
 Meat meal and bone meal: Used in livestock feed and pet food.

By solving an environmental ‘problem’ the project sets a national roadmap for meat and
meat by-product traceability built on food safety, hazard analysis and critical control point
[HACCP] systems, quality control [QC], quality assurance [QA], environmental management
systems [EMS]. The project addresses the greening of the meat value chain and supports the
building of a credible, transparent and verifiable traceable chain to engage with
international markets for meat products originating in the project partner abattoirs and for
the meat by-product raw materials arising in the rendering plant.
Using an environmental eco-effectiveness framework, the project integrates many of the
core competences of UNIDO including the promotion of Green Industries through
encouraging an industrial development that is inclusive and efficient as well as protective of
the natural environment; the value addition to the output of the agricultural sector and
generation of increased employment opportunities, thereby contributing to increased food
security and a sustainable reduction of poverty.

Figure 3

PILOT VALUE CHAIN

*GTP Livestock Quarantine Station: This refers to Ministry of Agriculture measures to

establish livestock veterinary controlled quarantine feeding stations.

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PROJECT OBJECTIVE, OUTCOME, OUTPUTS AND ACTIVITIES

OBJECTIVE

The project objective is to achieve resource-efficiency in the meat sector by developing a

pilot value chain for the Ethiopian meat by-products sector, with traceable linkage to the
national livestock value chain, to develop products and semi products as raw material, and
as a stimulus, for the industrial manufacture of commercial products for local demand and
international markets thereby fostering employment creation, safeguarding the
environment and accelerating inclusive and sustainable industrial development.

OUTCOME

The project will support the development a pilot value chain that exploits and transforms a
current waste into raw materials through the environmentally sound management and
rendering of animal by-products for the manufacture of a spectrum of industrial products
serving the domestic Ethiopian market and international demand.

OUTPUTS

 An incremental extension of the GTP environmental, quality and traceability

management systems, including relevant policy, institutional and technical support
frameworks for the livestock sector, to the animal by products sector based around
export oriented abattoirs established.

 Investment for the establishment of a pilot rendering capability in Ethiopia and market
driven manufacturing of commercial products from raw material or semi-products
derived directly from animal by-products or from the rendering of such materials
promoted and facilitated.

ACTIVITIES

 Develop a design study for an animal by products pilot value chain based on an ‘IDEAL
MODEL’ approach tempered by a gap analysis of actual field conditions and laterally
scoped from newly established livestock quarantine feeding stations to selected export
oriented abattoirs, to the technical design of a rendering facility through to market
driven industrial manufacturing of a sample of products.

 Assess Ethiopian Growth and Transformation Plan [GTP] in the context of the animal by
products sector, to ensure the alignment and functioning of national investment
incentives and policy support frameworks throughout the pilot value chain.

 Develop and implement capacity building plan on verifiable standards, practices and
procedures consistent with access to international markets for Ethiopian meat and meat
by-products targeting relevant authorities (ministries, Ethiopian standards authority,)
and institutions through trainings, upgrades of laboratories and international twinning
linkages to strengthen Ethiopian institutional and technical competence

 Support the Integration and coordination of focused institutional quality control,

regulation and certification as interdependent elements throughout the complete

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 livestock value chain from primary production to meat and meat by-products processing
and industrial exploitation
 Promote cleaner production, environmental and quality management, occupational
health and safety, HACCP and food safety at operational level in selected private sector
facilities to improve competiveness and international market access of the animal by-
products sector in Ethiopia.

 In association with the Ethiopian Standards Authority develop international market led
certification standards for the Ethiopian animal by products sector to assure
international market access.

 Commission a set of studies as a foundation for investment prospectus for value-added

opportunities along the complete value chain with particular emphasis on the industrial
exploitation of animal by-products as raw material, semi-products and manufactured
products in order to clarify and disseminate information on market access criteria,
including product specification, certification, labelling and other quality assurances
demanded.

 Develop technical and commercial feasibility study as a foundation for communication

with potential investors to include the pilot value chain design from supply chain to
rendering to manufacture and sale of product.

 Assess the feasibility of locating the pilot value chain facilities in the planned Integrated
Agro-Food Park in order to create synergies with ongoing UNIDO initiatives and
alignment with UNIDO’s Ethiopia Programme for Country Partnership priorities.

 Organize study tours for Ethiopian counterparts to Asia and Europe to transfer animal
by-products knowledge and experiences on value added techniques, product
development, final processing and packaging. The study tours will also bring
opportunities to address cooperation, market access and potential for new product
development and export.

 Carry out investment and technology promotion in cooperation with UNIDO’s ITPO
Network and other relevant institutions to implement promotional campaigns,
matchmaking activities and business trade ventures to introduce the sector as an
attractive investment/trade option.

PROJECT ORGANIZATION

UNIDO

The project demands the coordinated input of several UNIDO technical branches. These
inputs will be focused and coordinated by a dedicated UNIDO HQ coordinator. To ensure the
success of UNIDO’s delivery as one the HQ Coordinator will be familiar both with UNIDO
internal procedures and the network of established Ethiopian and international project
stakeholders.

STEERING COMMITTEE

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A steering committee, with representation from the Ministry of Industry (chair), Ministry of
Agriculture, Ministry of Trade, UNIDO and the Ethiopian Meat and Dairy Industry
Development Institute and the Ethiopian Food, Beverage and Pharmaceutical Industry
Development Institute will direct and monitor project implementation. The Steering
committee meetings would be convened as necessary but at least twice a year by UNIDO, to
agree upon work plans, resource allocations and reporting of progress.
Ad-hoc participation of representatives of project partner abattoirs, Ministry of Environment
and Forestry, Agricultural Transformation Agency, The Ethiopian Food, Medicine, Healthcare
Administration and Control Authority, academia and consumer associations, will be
determined for each meeting as deemed necessary.

INTERNATIONAL IMPLEMENTATION ADVISORY BODY

An International Implementation Advisory Body will be established, comprising foreign

institutions with expertise in environmental management, investment, technology transfer,
quality and standards, which will be engaged on sub-contract basis as appropriate. In
particular the Advisory Body will be engaged in developing linkages to foreign partner
institutions, sharing knowledge and experiences as well as the promotion of investment and
trade opportunities

FIGURE 4
PROJECT ORGANISATION

NATIONAL PROJECT UNIT

The Project will recruit a National Project Director to lead the National Project Unit. The
National Project Unit will be established in consultation with the Ministry of Industry and
will include a Project assistant and a driver.

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Short-term specialist international experts will be recruited as appropriate and supported by
national experts to ensure transfer of know-how and the appropriateness of proposed
solutions in the context of the socio-economic and cultural realities of Ethiopia.
UNIDO will also ensure that all recipient institutions implement the plan and the strategy
agreed in the project, in order to promote transparency and enhanced corporate
governance.

Institutional arrangements and coordination mechanism

The proposed initiative will be implemented by PTC/ENV/SCU in close coordination with the
established PCP Ethiopia implementation structure.

Environmental and Social Assessment

Against a background of increasing access to export markets and the potential for
unprecedented growth in the livestock the environmental and social implications are
outlined with reference to [1] primary production, [2] commercial abattoirs and [3] animal
by product value added.

Policy Driven Change

The environmental and social assessment of the industrialization of the meat by-products
sector in Ethiopia must take account of the implications and impacts across the total
livestock value chain.
This project comes at a time on change and expansion in the livestock and meat sector
stimulated by government support for the export of livestock and livestock products.
Access to export markets for Ethiopian livestock and livestock products [including products
made from by-products] depends on the capacity and integrity of the livestock chain.
High on the priority is the status of transboundary animal disease [TAD] control.
A major breakthrough came in May 2005 when the World Organisation for Animal Health
certified Ethiopia free from rinderpest, which opened some limited markets notable in the
UAE. [It should be noted however that other TADs such as Foot and Mouth disease remain
endemic creating continuing constraints to export.]
Following the eradication of rinderpest the Ethiopian government introduced policy
incentives for the livestock sector that included the formation of industry associations,
deregulation of domestic prices, liberalisation of foreign trade, institutional support for the
export sector and promulgation of liberal investment and labour laws.
These changes were important for establishing privately owned export abattoirs and the
construction of market yard facilities in pastoral areas. When combined with greater market
stratification, mainly through feedlot operations, and improvements in roads and mobile
phone systems, the result was a boost in the formal export of livestock and livestock
products from the country.
Ethiopia’s Growth and Transformation Plan (GTP), released in 2010, aimed to generate
US$1bn from livestock exports by 2015. However, current formal export values from
livestock and meat are only about 25 percent of this target.
Nevertheless the data in Table 1 below, sourced from the National Bank of Ethiopia, shows
the continuing rise in live animal exports and meat exports driven by access to export
markets and stimulated by government policy.

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The growth and expansion of primary livestock production, commercialization and
industrialization of abattoirs and the associated export market quality standards orientation
is therefore the context for environmental and social assessment.

Primary Production

This project integrates into this growth and expansion model by increasing the scope of the
value chain to include the commercialization and industrialization of the animal by-products
arising and the creation of new industries, products and semi-products.
Livestock production systems in Ethiopia have evolved largely as a result of the influence of
the natural production environments and socio economic circumstances rather than market
forces. Sustainable pastoral production of livestock is central to the growth and expansion of
the sector but ultimately constrained by the carrying capacity of the ecosystem. The balance
between carrying capacity and ecosystem is a knowledge embedded in the pastoral
communities. Farmers / pastoralists choice of agricultural enterprises in Ethiopia depends on
the production environment [availability of resources, particularly land, water and climate]
long standing tradition of agricultural production in the community, socio economic
circumstances [awareness and skill, access to inputs and markets] and government support
[inputs and services] which stems from agricultural policies.
Ethiopian agricultural development policy is based on the premise that growth in the
livestock sector can only be achieved if there are commercial livestock farms, probably in
mid-altitude areas, that can provide sustainable services to pastoralists, agro pastoralists
and farmers – i.e., capacity building, introduction of new technologies, veterinary controls,
improved breeds and the much needed fodder and other inputs as required. Such
commercial farms in turn also rely on pastoralists for supplies of young stock and other
livestock products, creating reciprocal bonds and mutual benefits. Standards – such as
transactions on weight and age and breed classifications – can only be raised through
commercial operators, which could pave the way for pastoralists to follow suit with
emphasis on quality rather that quantity.
The environmental and social red flag on overproduction in a fragile environment demands
to be raised ... and one that has to be addressed and managed in the interests of all the
stakeholders in the value chain. In common with other pastoralist areas of the world, and
due to the basic economics of pastoral livestock production and household food security
needs, commercialization typically contributes to a gradual redistribution of livestock from
poorer to wealthier producers. When combined with other trends such as human
population growth and increasing demands for livestock products, plus recurrent drought,
one outcome is the dual presence of market-orientated pastoralism and pastoralist

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destitution. Livestock development in Ethiopia – and especially export-orientated trade – is
inseparable from the development of pastoralist areas, because these areas have long been
the main source of animals for export, and this trend is likely to continue.

Commercial Abattoirs

The development of commercial abattoirs is central to government policy and critical for the
expansion of the chilled meat export sector. The animal by products sector is also
dependent on a functioning and quality controlled abattoir capacity as a quality controlled
source of raw material. Traceability and quality control of inputs is particularly critically in
the higher value products such as gelatin. Pastoralist producers are the sole suppliers of
livestock to domestic consumers, especially those adjacent to pastoralist areas where
typically slaughtering is carried out in an artisan and informal setting.
The development of commercial abattoirs threatens this longstanding socio -economic
relationship between the pastoral producer and the domestic consumer.
However on the positive side, there are significant environmental and public health benefits
to be gained from the formalization of slaughtering. This assumption is based on the
premise that sustainable environmental controls are incorporated into the commercial
abattoirs. At a social level the development of commercial abattoirs including deboning,
processing and packaging offers new direct and indirect employment opportunities.

Animal By-Product Value Added

The project will support the development a pilot value chain that exploits and transforms a
current waste into raw materials through the environmentally sound management and
rendering of animal by-products for the manufacture of a spectrum of industrial products
serving the domestic Ethiopian market and international demand.
The pilot project will set a roadmap for the development of industrialized production
processes based on animal by products, generally derived from the emerging commercial
abattoir sector that manufactures food and non-food products and semi products that can
compete in global markets.
The success and international credibility of the Ethiopian Animal By Products sector is
dependent on the capacity and integrity of the livestock value chain for supply and quality
assurance. Roll out of the sector will demand foreign direct investment of capital,
technology, and knowhow and market access.
The social implication of creating new industries and new industrial employment
opportunities must be regarded as positive in a country where the labor force is growing
rapidly year on year due to demographic increase. However the spectrum of skills
demanded will range from operative to technically demanding positions and managerial
responsibility for which capacity will have to be built over time.
The environmental benefits of using a resource, which previously had been regarded as
waste, have been previously stated.

MONITORING AND EVALUATION PLAN

Monitoring of project implementation is a major responsibility of the Project Management

Unit (PMU).The data for determining the value of indicators will come from the main project
implementation data base to be developed by the project. The PMU will be responsible for
data collection and inputs and for reviewing implementation process. Annual meetings will
be held with key stakeholders to review effective use of the Grant and any counterpart
funding.

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A Mid-term review will be also organized after two and a half years project implementation
to review status of implementation and discuss potential improvement in project design.
The project completion review also provides stakeholders a chance to review results
achieved by the project and identify means improvement in the project management as well
as lessons learned. The types of M&E activities, responsible parties, the budget
requirements and timeframe to implement these activities are indicated in the table below.

Type of M&E activity Responsible Parties Time frame

Hold the project inception workshop PMU, UNIDO, Within 3 months after
Stakeholders Donor approval
Prepare Inception regional Report PMU, UNIDO Within 6 months after
the project Inception
Measure the impact indicators on yearly Independent Annually
basis Consultant
Prepare Annual Project Reports PMU, UNIDO Annually

Hold annual Tripartite Review meetings UNIDO/MOI/Donor Annually

Carry out mid-term external evaluation UNIDO At the mid-point of the

project
implementation
Produce annual project financial audits UNIDO Annually

Establish a project management PMU/UNIDO Throughout the project

information system (MIS), including a implementation
project website to disseminate
information to stakeholders
Perform final external evaluation External Auditor Within 12 months after
the completion of the
project
implementation
Complete the Project Terminal Report PMU,UNIDO

BENEFICIARIES

The project beneficiaries are the supply chain members of the Ethiopian meat and meat by-
products sectors. Supervisors, inspectors, managers and staff of the Ministry of Industry
(MoI), Ministry of Agriculture (MoA), Ministry of Environment and Forestry, The Ethiopian
Food, Medicine, Healthcare Administration and Control Authority, The Ethiopian Meat and
Dairy Industry Development Institute, the Ethiopian Food, Beverage and Pharmaceutical
Industry Development Institute and the Ethiopian Standards Authority of Ethiopia will
benefit from the capacity building and institutional development component of the project.

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The beneficiaries will also include unemployed youth in and around Addis Ababa who will
benefit from the employment opportunities generated by the rendering plant as well as new
industries utilizing the materials recovered from animal by-products.

RISKS, OPPORTUNITIES AND SYNERGIES

Possible Risks
Potential risks and the mitigation measures to be taken into account for this project are
described in the table below.

Potential Risks Proposed Mitigation Measures Rating

Ensuring effective This risk is addressed by involving all relevant stakeholders. Medium
cooperation between the It will also involve awareness-raising and education aimed at
stakeholders is unable to achieving cooperation and improved coordination
be achieved for the mechanisms. Activities and initiatives will be demand driven,
implementation of the so beneficiaries see the value of improving their practices.
project
Lack of ability to develop The project will support the development and Low
appropriate arrangements implementation of a technology transfer promotion
to attract national and programme to inform the private sector and NGOs of
international private opportunities and to encourage their support. UNIDO will
investment or secure use the existing Technology Promotion Offices network to
support for the facilitate match making and investment tie-ups.
development and
implementation of
public/private
partnerships
Lack of appropriate The project will collaborate with serious investors and Low
infrastructure associations willing to make the change and improve the
existing situation & increase the maximum output of the
existing facilities. Cost-effective and affordable
modernization solutions will be proposed to producers.
Weak coordination and The project is designed to ensure regular communications Low
harmonization of the and timely information exchange among project owners,
project with other related implementers and stakeholders. Furthermore, the
activities that will be consultation mechanism initiated by the project among
undertaken by other international and national stakeholders will avoid
ongoing or potential overlapping activities among and between on-going and
projects potential projects.
Overall risk rating Low

SYNERGIES

The project will aim to create synergies with other ongoing UNIDO projects. In particular,
the project will closely align activities with the UNIDO project entitled “Preparation of
business plan for piloting Integrated Agro- Food Parks (IAFP) in Ethiopia”, which aims to
support the development of a business plan for an Integrated Agro-Food Park (IAFP). An
Integrated Agro-Food Park (IAFP) is a cluster of independent firms grouped together to share

15
infrastructure, (i.e., roads, power, communication, etc.) and to exploit the opportunities for
joint buying, selling, training, extension services and other synergies which can arise from
shared efforts. The concentration of activities and services in one area is expected to
facilitate economies of scale for the transformation of agricultural products for export or
further commercialization. IAFPs will lead to increased competitiveness of the agro-food
sector, while including smallholder farmers and processing businesses in growing and
modernizing agricultural value chains in Ethiopia.

SUSTAINABILITY

The project is in line with government policies such as Ethiopia's Growth and Transformation
Plan (GTP) and contributes to targets set out in Chapter 5.2 (Industry) and Chapter 8.9
(Environment and Climate Change) during the Period of the GTP. The Federal Democratic
Republic of Ethiopia has established the 5 years Growth and Transformation Plan, replacing
the former Plan for Accelerated and Sustainable Development to End Poverty in Ethiopia. In
the context of the new Plan, the Ministry of Environment and Forest has decided to focus its
efforts into revitalizing and concretely defining environmental and sustainable development
policies on the sound management of waste. The second phase (2015-2020) of the GTP is
currently being initiated and relevant government institutions pledged to include the project
activities into the GTP 2 to ensure the inclusion of the animal by-products sector in the
national social and economic development planning process. The project will also contribute
to the target areas outlined in the UNDAF (outcome 5, Pillar 1: Sustainable Economic Growth
and Risk Reduction).

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PROJECT LOGICAL FRAMEWORK
Objective: The project objective is to achieve resource-efficiency in the meat sector by developing a pilot value chain for the
Ethiopian meat by-products sector, with traceable linkage to the national livestock value chain, to develop products and
semi products as raw material, and as a stimulus, for the industrial manufacture of commercial products for local
demand and international markets thereby fostering employment creation, safeguarding the environment and
accelerating inclusive and sustainable industrial development.
Outcome: The project will create a pilot value chain that exploits and transforms a current waste into raw materials through the
environmentally sound management and rendering of animal by-products for the manufacture of a spectrum of
industrial products serving the domestic Ethiopian market and international demand.
Activity Indicator Means of Verification Assumptions
Output 1: An incremental extension of the GTP environmental, quality and Established GTP Inclusion of animal by- Government
traceability management systems, including relevant policy, institutional and policies, incentives and products sector in the commitment;
technical support frameworks for the livestock sector, to the animal by products other measures national social and
sector based around export oriented abattoirs established. extended, prioritized economic
and specified to the development planning
Ethiopian animal by- process
products sector
1.1 Develop a design study for an animal by products pilot value chain Data acquisition Completed design Availability of
based on an ‘IDEAL MODEL’ approach tempered by a gap analysis of activities undertaken study sufficient and
actual field conditions and laterally scoped from newly established including modeling, appropriate data
livestock quarantine feeding stations to selected export oriented desk and field research sources
abattoirs, to the technical design of a rendering facility through to market
driven industrial manufacturing of a sample of products.
1.2 Assess Ethiopian Growth and Transformation Plan [GTP] in the Assessment report to Completed Government
context of the animal by products sector, to ensure the alignment and include institutional assessment report commitment to
functioning of national investment incentives and policy support mapping prioritize the
frameworks throughout the pilot value chain. animal by
products sector
1.3 Develop and implement capacity building plan on verifiable Capacity building plan Capacity building plan Government

17
standards, practices and procedures consistent with access to to include: including training commitment;
international markets for Ethiopian meat and meat by-products targeting # of government needs assessments; cooperation
relevant authorities (ministries, Ethiopian standards authority,) and officials trained; # of Project Progress from
institutions through trainings, upgrades of laboratories and international laboratories upgraded Reports stakeholders
twinning linkages to strengthen Ethiopian institutional and technical through procurement of and foreign
competence equipment and partner
technicians trained; # of institutions
international twinning
linkages (MoUs and
Agreements)
established
1.4 Support the Integration and coordination of focused institutional # of training workshops; Project progress Cross
quality control, regulation and certification as interdependent elements # of awareness raising reports; Training institutional
throughout the complete livestock value chain from primary production activities # of inter- reports willingness to
to meat and meat by-products processing and industrial exploitation ministerial working cooperate
groups established
1.5 Promote cleaner production, environmental and quality # of participants in Workshop reports; Private sector
management, occupational health and safety, HACCP and food safety at workshops on liquid and Project Progress partners
operational level in selected private sector facilities to improve solid waste Reports commitment
competiveness and international market access of the animal by- management. and willingness
products sector in Ethiopia. # of participants in to participate in
workshops on quality project activities
standards, biosafety
and certification in
animal by products
sector
1.6 In association with the Ethiopian Standards Authority develop # of standards Published standards Ethiopian
international market led certification standards for the Ethiopian animal developed and including Standards
by products sector to assure international market access. accredited; implementation Authorities
guidelines commitment

18
Output 2: Investment for the establishment of a pilot rendering capability in # of investments into Project Progress Sufficient supply
Ethiopia and market driven manufacturing of commercial products from raw the Ethiopian animal by Reports: Project of raw material
material or semi-products derived directly from animal by-products or from the products sector to Terminal Evaluation to warrant
rendering of such materials promoted and facilitated. include upgrading of Report investment;
meat processing Sufficient
systems; rendering market demand
facilities; downstream for commercial
manufacturing based on products
products and semi derived from
products from animal raw material or
by products and semi-products
rendering derived directly
from animal by-
products
2.1 Commission a set of studies as a foundation for investment # of studies completed; Market Study Availability of
prospectus for value-added opportunities along the complete value chain # of business Documents: Project sufficient and
with particular emphasis on the industrial exploitation of animal by- opportunities Progress Reports appropriate data
products as raw material, semi-products and manufactured products in identified , quantified sources
order to clarify and disseminate information on market access criteria, and promoted
including product specification, certification, labelling and other quality
assurances demanded.
2.2 Develop technical and commercial feasibility study as a foundation Data acquisition, Comprehensive The scope and
for communication with potential investors to include the pilot value compilation and technical and completeness of
chain design from supply chain to rendering to manufacture and sale of analysis to complete commercial feasibility the study is the
product. study that includes study completed foundation for
technical design, capital communication
costs, commercial with potential
planning, investors
environmental,
economic and social

19
 impacts
2.3 Assess the feasibility of locating the rendering plant in the planned Assessment report on Assessment report IAFPs
Integrated Agro-Food Park in order to create synergies with ongoing co-locating the established;
UNIDO initiatives and alignment with UNIDO’s Ethiopia Programme for rendering plant in IAFP
Country Partnership priorities. for shared
infrastructure and
support services
2.4 Organize study tours for Ethiopian counterparts to Asia and Europe to # of study tours Project progress Availability of
transfer animal by-products knowledge and experiences on value added organized; # of reports international
techniques, product development, final processing and packaging. The international partners with
study tours will also bring opportunities to address cooperation, market partnerships relevant
access and potential for new product development and export. established; knowledge and
experiences on
value added
techniques,
product
development,
final processing
and packaging.
2.5 Carry out investment and technology promotion in cooperation with # of local investment Conference reports, Investment
UNIDO’s ITPO Network and other relevant institutions to implement promotion events project progress interest in
promotional campaigns, matchmaking activities and business trade organized; # of report Ethiopian
ventures to introduce the sector as an attractive investment/trade international economy and
option. investment promotion specifically the
events organized; # of animal by-
investors engaged; # of products sector.
international
partnerships
established;

20
BUDGET
Project Budget by Year and Output

Budget Year 1 Year 2 Year 3 Year 4 Total

Outputs Description
lines
US$ US$ US$ US$ US$
11-00 International consultants 96,000 120,000 158,000 96,000 470,000

Output 1: An incremental extension 15-00 Project travel 10,000 50,000 50,000 50,000 160,000
of the GTP environmental, quality 16-00 UNIDO staff travel 10,000 10,000 10,000 20,000 50,000
and traceability management 21-00 Sub-contracts 30,000 120,000 80,000 50,000 280,000
systems, including relevant policy, 17-00 National experts 116,000 148,000 124,000 116,000 504,000
institutional and technical support
frameworks for the livestock sector,
30-00 In-service training 30,000 100,000 100,000 80,000 310,000

to the animal by products sector 35-00 Workshops 0 50,000 0 50,000 100,000

based around export oriented 45-00 Equipment 100,000 150,000 150,000 50,000 450,000
abattoirs established, 51-00 Miscellaneous 20,000 30,000 20,000 30,000 100,000
Sub-total 412,000 778,000 692,000 542,000 2,424,000

Output 2: Investment for the 11-00 International consultants 0 48,000 36,000 34,000 118,000
establishment of a pilot rendering 15-00 Project travel 0 80,000 120,000 100,000 300,000
capability in Ethiopia and market 21-00 Sub-contracts 0 200,000 100,000 50,000 350,000
driven manufacturing of commercial 17-00 National experts 0 24,000 28,000 24,000 76,000
products from raw material or semi-
products derived directly from animal
30-00 In-service training 0 250,000 0 10,000 260,000

by-products or from the rendering of 35-00 Workshops 0 80,000 120,000 150,000 350,000
such materials promoted and 51-00 Miscellaneous 0 20,000 10,000 20,000 50,000
facilitated, Sub-total 0 702,000 414,000 388,000 1,504,000
TOTAL 412,000 1,480,000 1,106,000 930,000 3,928,000

21
Project Budget by activity

Activity BL Description US$

1.1 Develop a design study for an animal by products pilot value chain based on an 11-00 International consultants 120,000
‘IDEAL MODEL’ approach tempered by a gap analysis of actual field conditions and 15-00 Project travel 20,000
laterally scoped from newly established livestock quarantine feeding stations to 16-00 UNIDO staff travel 10,000
selected export oriented abattoirs, to the technical design of a rendering facility 17-00 National experts 96,000
through to market driven industrial manufacturing of a sample of products. 51-00 Miscellaneous 20,000
Activity Total 266,000
11-00 International consultants 45,000
1.2 Assess Ethiopian Growth and Transformation Plan [GTP] in the context of the 15-00 Project travel 20,000
animal by products sector, to ensure the alignment and functioning of national
17-00 National experts 30,000
investment incentives and policy support frameworks throughout the pilot value
chain. 30-00 In-service training 15,000
51-00 Miscellaneous 10,000
Activity Total 120,000
11-00 International consultants 120,000
1.3 Develop and implement capacity building plan on verifiable standards, practices
15-00 Project travel 50,000
and procedures consistent with access to international markets for Ethiopian meat 16-00 UNIDO staff travel 10,000
and meat by-products targeting relevant authorities (ministries, Ethiopian 21-00 Sub-contracts 110,000
standards authority,) and institutions through trainings, upgrades of laboratories 17-00 National experts 310,000
and international twinning linkages to strengthen Ethiopian institutional and 30-00 In-service training 195,000
technical competence Workshops
35-00 25,000
45-00 Equipment 320,000
Activity Total 1,140,000
1.4 Support the Integration and coordination of focused institutional quality 11-00 International consultants 55,000
control, regulation and certification as interdependent elements throughout the 15-00 Project travel 20,000

22
complete livestock value chain from primary production to meat and meat by- 16-00 UNIDO staff travel 10,000
products processing and industrial exploitation 21-00 Sub-contracts 60,000
17-00 National experts 38,000
30-00 In-service training 40,000
45-00 Equipment 50,000
51-00 Miscellaneous 20,000
Activity Total 293,000
11-00 International consultants 60,000
15-00 Project travel 40,000
16-00 UNIDO staff travel 20,000
1.5 Promote cleaner production, environmental and quality management, 21-00 Sub-contracts 110,000
occupational health and safety, HACCP and food safety at operational level in
17-00 National experts 20,000
selected private sector facilities to improve competiveness and international
market access of the animal by-products sector in Ethiopia. 30-00 In-service training 60,000
35-00 Workshops 65,000
45-00 Equipment 80,000
51-00 Miscellaneous 40,000
Activity Total 495,000
11-00 International consultants 70,000
1.6 In association with the Ethiopian Standards Authority develop international 15-00 Project travel 10,000
market led certification standards for the Ethiopian animal by products sector to 17-00 National experts 10,000
assure international market access. 35-00 Workshops 10,000
51-00 Miscellaneous 10,000
Activity Total 110,000
Output Sub-Total 2,424,000
2.1 Commission a set of studies as a foundation for investment prospectus for 11-00 International consultants 35,000
value-added opportunities along the complete value chain with particular emphasis 15-00 Project travel 80,000

23
on the industrial exploitation of animal by-products as raw material, semi-products 21-00 Sub-contracts 150,000
and manufactured products in order to clarify and disseminate information on 17-00 National experts 12,000
market access criteria, including product specification, certification, labelling and In-service training
30-00 20,000
other quality assurances demanded.
51-00 Miscellaneous 10,000
Activity Total 307,000
11-00 International consultants 45,000
21-00 Sub-contracts 20,000
2.2 Develop technical and commercial feasibility study as a foundation for 17-00 National experts 12,000
communication with potential investors to include the pilot value chain design from
30-00 In-service training 10,000
supply chain to rendering to manufacture and sale of product.
35-00 Workshops 60,000
51-00 Miscellaneous 10,000
Activity Total 157,000
2.3 Assess the feasibility of locating the rendering plant in the planned Integrated 11-00 International consultants 10,000
Agro-Food Park in order to create synergies with ongoing UNIDO initiatives and 15-00 Project travel 10,000
alignment with UNIDO’s Ethiopia Programme for Country Partnership priorities. 30-00 In-service training 30,000
Activity Total 50,000
11-00 International consultants 19,000
2.4 Organize study tours for Ethiopian counterparts to Asia and Europe to transfer 15-00 Project travel 170,000
animal by-products knowledge and experiences on value added techniques, 21-00 Sub-contracts 100,000
product development, final processing and packaging. The study tours will also
17-00 National experts 20,000
bring opportunities to address cooperation, market access and potential for new
product development and export. 30-00 In-service training 80,000
51-00 Miscellaneous 20,000
Activity Total 409,000
2.5 Carry out investment and technology promotion in cooperation with UNIDO’s 11-00 International consultants 9,000
ITPO Network and other relevant institutions to implement promotional campaigns, 15-00 Project travel 40,000
matchmaking activities and business trade ventures to introduce the sector as an 21-00 Sub-contracts 80,000

24
attractive investment/trade option. 17-00 National experts 32,000
30-00 In-service training 120,000
35-00 Workshops 290,000
51-00 Miscellaneous 10,000
Activity Total 581,000
Output Sub-Total 1,504,000
Project total 3,928,000

25
Total Project Budget

Budget lines Items USD

11-00 International consultants 588,000
15-00 Project travel 460,000
16-00 UNIDO staff travel 50,000
17-00 National experts 580,000
21-00 Sub-contracts 630,000
30-00 In-service training 570,000
35-00 Workshops 450,000
45-00 Equipment 450,000
51-00 Miscellaneous 150,000
Total 3,928,000

26
WORKPLAN

Semesters
Activity
1 2 3 4 5 6 7 8
Output 1: An incremental extension of the GTP environmental, quality and traceability
management systems, including relevant policy, institutional and technical support
frameworks for the livestock sector, to the animal by products sector based around export
oriented abattoirs established.
1.1 Develop a design study for an animal by products pilot value chain based on
an ‘IDEAL MODEL’ approach tempered by a gap analysis of actual field
conditions and laterally scoped from newly established livestock quarantine
feeding stations to selected export oriented abattoirs, to the technical design of
a rendering facility through to market driven industrial manufacturing of a
sample of products.
1.2 Assess Ethiopian Growth and Transformation Plan [GTP] in the context of
the animal by products sector, to ensure the alignment and functioning of
national investment incentives and policy support frameworks throughout the
pilot value chain.
1.3 Develop and implement capacity building plan on verifiable standards,
practices and procedures consistent with access to international markets for
Ethiopian meat and meat by-products targeting relevant authorities (ministries,
Ethiopian standards authority,) and institutions through trainings, upgrades of
laboratories and international twinning linkages to strengthen Ethiopian
institutional and technical competence
1.4 Support the Integration and coordination of focused institutional quality
control, regulation and certification as interdependent elements throughout the
complete livestock value chain from primary production to meat and meat by-
products processing and industrial exploitation

27
 1.5 Promote cleaner production, environmental and quality management,
occupational health and safety, HACCP and food safety at operational level in
selected private sector facilities to improve competiveness and international
market access of the animal by-products sector in Ethiopia.

1.6 In association with the Ethiopian Standards Authority develop international

market led certification standards for the Ethiopian animal by products sector to
assure international market access.
Output 2: Investment for the establishment of a pilot rendering capability in Ethiopia and
market driven manufacturing of commercial products from raw material or semi-products
derived directly from animal by-products or from the rendering of such materials promoted
and facilitated.

2.1 Commission a set of studies as a foundation for investment prospectus for

value-added opportunities along the complete value chain with particular
emphasis on the industrial exploitation of animal by-products as raw material,
semi-products and manufactured products in order to clarify and disseminate
information on market access criteria, including product specification,
certification, labelling and other quality assurances demanded.
2.2 Develop technical and commercial feasibility study as a foundation for
communication with potential investors to include the pilot value chain design
from supply chain to rendering to manufacture and sale of product.
2.3 Assess the feasibility of locating the rendering plant in the planned
Integrated Agro-Food Park in order to create synergies with ongoing UNIDO
initiatives and alignment with UNIDO’s Ethiopia Programme for Country
Partnership priorities.

28
2.4 Organize study tours for Ethiopian counterparts to Asia and Europe to
transfer animal by-products knowledge and experiences on value added
techniques, product development, final processing and packaging. The study
tours will also bring opportunities to address cooperation, market access and
potential for new product development and export.

2.5 Carry out investment and technology promotion in cooperation with

UNIDO’s ITPO Network and other relevant institutions to implement
promotional campaigns, matchmaking activities and business trade ventures to
introduce the sector as an attractive investment/trade option.

29