Final RESEARCH THESIS MT2

IMPACT OF TENDAHO SUGAR CANE PLANTATION PROJECT ON
THE PASTORAL LIVELIHOOD AT AFAR REGIONAL STATE, CASE

STUDY ZONE ONE
By:
Mesfin Tasew
A thesis submitted to the Department of Economics Samara University and Tossa College of
economics development, in partial fulfillment for the requirements of Masters of Science
Degree in Project Planning and Management.
ADVISOR: DR. HASSEN BESHIR
CO-ADVISOR: M R. GETACHEW W.
November 14 , 2019
Samara, Ethiopia
Samara University joint Master’s program with Tossa College of
Economic Development
Department of Economics
IMPACT OF TENDAHO SUGAR CANE PLANTATION PROJECT ON THE

PASTORAL LIVELIHOOD AT AFAR REGIONAL STATE, IN THE CASE
STUDY OF ZONE ONE
BY
Mesfin Tasew
Approved by Board of Examiners
1. HASSEN BESHIR (DR) _ ___________________ _______________
Advisor Signature Date
2. ______________________ __________________ _______________
External Examiner Signature Date
3. ______________________ __________________ ________________
Internal Examiner Signature Date
4. _______________________ __________________ ________________
Chair Person Signature Date

DECLARATION
I, Mesfin Tasew hereby declare that the thesis entitled “Impact of Tendaho Sugarcane Plantation
Project On The pastoralist Livelihood at Afar Regional State, Case study zone one” submitted in
Partial fulfillment of the requirements for the Masters of Science Degree in Project Planning and
Management complies with the regulations of the University and meets the expected standard with
respect to originality and quality.
.
Name of student: Mesfin Tasew
Signature ___________________
Date ___________________
i
CERTIFICATION
This is to certify that thesis entitled, “Impact of Tendaho Sugarcane Plantation Project On The
pastoralist Livelihood at Afar Regional State, Case Study Zone One”, undertaken by Mesfin
Tasew Asres for the partial fulfillment of the degree of Master of Science in Project Planning
and Management at Samara University, to the best of my knowledge, is an original work and
not submitted earlier for any degree either at this University or any other University.
Principal Advisor:
Signature
Date
Co-Advisor:
Signature
Date
ii
ACKNOWLEDGEMENT
I would like to express my deepest appreciation for my wife Genet Kassa for her insistent support
in facilitating and coordinating the interview administration along with all key stakeholders.
Special thanks goes to all interviewed households, farmers association, women association Assaita
wored administration representative, head of agriculture office and experts, Tendaho factory
planning staff , and Tendaho area sugar growers cooperative union members and representative for
their positive ,genuine and transparent support in responding to interviews and active participation
during focus group discussions.
Moreover, I would like to express my honest appreciation and gratefulness to my advisor, Dr
Hassen Beshir and to my co-advisor Mr.Getachew W. for their patient supervision, guidance and
constructive suggestions which helped me to enrich the study.
Finally, I would also like thank my friend Getu Endashaw, for reading the first draft and valuable
comments he provided.
iii
Table of Contents
DECLARATION ......................................................................................................................................... iii
 List of Tables ....................................................................................................................................... iv
 List of figure ......................................................................................................................................... v
LIST OF ACRONYMS .................................................................................................................................... vi
Introduction................................................................................................................................................... 1
1.1. Background of the study ................................................................................................................... 1
1.2. Problem Statement ............................................................................................................................ 3
1.3. Objective of the Study ..................................................................................................................... 5
1.4. Research Questions ............................................................................................................................ 5
1.5. Significance of the study .................................................................................................................... 5
1.6. Scope of the study .............................................................................................................................. 6
2. LITERATURE REVIEW ................................................................................................................ 8
2.1 .1.Global Trends in Sugarcane Farming ........................................................................................ 8
2.1.2. Plantation Sugarcane Farming and Community Livelihoods ................................................... 9
2.2. Related Empirical Studies............................................................................................................. 10
2.2.1. The impact expansion of Sugarcane Production in Different Countries ................................ 10
2.3. Conceptual Framework................................................................................................................. 14
2.5. Summary of Research Gaps............................................................................................................ 14
3. Methods of the study.............................................................................................................................. 16
3.1. Study Area ........................................................................................................................................ 16
3.2. Research Design............................................................................................................................ 16
3.3. Target Population and Sampling Procedures .............................................................................. 18
3.4. Data Collection Methods .............................................................................................................. 19
3.5.1. Model Specification and estimation method ............................................................................. 20
3.5.1.1 Theoretical definition............................................................................................................... 20
3.5.2. Estimation Method ..................................................................................................................... 21
CHAPTER FOUR: RESULTS AND DISCUSSTION ............................................................................ 32
4. Introduction............................................................................................................................................. 32
4.1. 1.Socio-Demographic Characteristics of the Study ........................................................................... 32
4.1.1.1. Sex composition of the observation study .............................................................................. 33
4.1.1.3. Age Characteristics of the respondents .................................................................................. 34
4.1.1.5 Marital status of household ..................................................................................................... 35
4.1.2.1. Land Holding of the Household ............................................................................................. 36
4.1.2.3. Asset of household .................................................................................................................. 37
4.1.2.5. Benefit of household from employment of at the sugar factory......................................... 40
4.2.1. Focus Group Discussion............................................................................................................ 44
4.2.2. ATT Estimation Impact of Expansion Sugarcane Plantation Project on Pastoralist and Agro
Pastoralist of average annual income of household........................................................................... 45
4.2.4. Sensitivity Analysis..................................................................................................................... 47
5.1. CONCLUSION ............................................................................................................................... 48
5.2. Recommendations ............................................................................................................................ 49
6. REFERENCES ................................................................................................................................... 51
7. Appendix........................................................................................................................................... 53
List of Tables
Table 3.1: Summary of dependent Variables description included in the Model------------------ 29
Table 3.2: Summary of Outcome Variable description included in the Model-------------------30
Table 4.1 sex composition of respondents of observation study-----------------------------------33
Table 4.2 educational level of respondents -----------------------------------------------------------34
Table 4.3 Ages of participant and non-participant --------------------------------------------------35
Table 4.4 Family size household-----------------------------------------------------------------------35
Table 4.5 Martial Status --------------------------------------------------------------------------------36
Table 4.6 Average Area holding of household before intervention project ---------------------37
Table 4.7 Average annual income of household before intervention project--------------------37
Table 4.8 Average asset of household before and after intervention -----------------------------38
Table 4.9 Distance of market from household ------------------------------------------------------39
Table 4.10 Access to agricultural extension service ------------------------------------------------40
Table 4.11 Benefit from Employing Tendaho Sugar Factory--------------------------------------40
Table 4.12 Balance of covariates of the project----------------------------------------------------42
Table 4.13 mean of impact of expansion of sugarcane plantation on average annual income-46
Table 4.14 Average Treated effect on Treated (ATT) of different matching---------------------46
iV
List of figure
Fig 3.1 Conceptual Framework -------------------------------------------------------------------------15
Fig 4.4 Common Support of Treated and Untreated -------------------------------------------------43
Fig4.5 Histograph of common support of Treated and control-------------------------------------44
V
LIST OF ACRONYMS
ACZ Agricultural Climate Zone
ARNS Afar Regional National State
BOA Bureau of Agricultural
CSA Central Statistics Agency
ETP Employments –To-Population Ratio
EPA Environmental Protection Authority
FAO Food and Agriculture Organization
FGD Focus Group Discussion
GDP Gross Domestic Production
GIS Geographical Information System
GTP Growth Transformation Project
MDG Millennium Development Goals
MOA Ministry Of Agriculture
TSF Tendaho Sugar Factory
Vi
ABSTRACT
The government of Ethiopia has developed a growth and Transformation plan two and strategy
which encompass different development programs including the agricultural sector for five years.
From the agricultural sector, Sugarcane production on 85,333 ha of land produce beyond 800,000
tones annually through developing new land expansion of the existing sugar cane production
Estate farms by the end of 2015 as part of the plan.To this effect a study was conducted to analyze
the impact of Sugar cane farmland expansion project on pastoral community livelihood as the
case study in Dubti, Detbhari and Assayita woreda ,Zone One of Afar Regional state Ethiopia. A
simple random sampling method was used to collect primary data from Dubti, Detbhari and
Assayita woreda three, two and one kebele respectively, extension agent, woreda administrator,
Tendaho Sugarcane Estate Farm Planning. Interview was done with extension agents while group
discussion was made with members of household and women association and Tendaho Sugar
cane plantation officers. Secondary data was collected from Tendaho Sugar factory office. The
data collected was analyzed with STATA Software version number 14.2 which employed
ANOVA, chi-square and PSM. The study revealed average annual income of household who are
displaced less by 9,498.346 birr than who were not displaced from their land because of
sugarcane farmland expansion project. And also variables like: area holding after the intervention,
sex, marital status, benefit from employed of the project and Agricultural extension show negative
impact while educational level(0.25 & significant at 5%) ,Making asset(0.006,sig at 5%) ,
age(0.022,-),household size(0.69,sig at 5%) and distance market(0.18,sig at 10%) show positive
influence on pastoralist livelihood by the sugarcane farmland expansion. From this study it was
concluded that the expansion of sugarcane plantation 60,000 hectares of land in the dry season
grazing area of Lower Awash basin without any enough and transpierces displaced mechanism to
the pastoralist have brought severe effect on livelihood of the pastoralist.
Keywords: Tendaho Sugarcane Plantation, Pastoralist, Socioeconomic impact, Livelihood
Vii
CHAPTER ONE
Introduction
1.1. Background of the study
The main driver behind the expansion of land under sugarcane farming and increasing
sugarcane monoculture is the constant rise in the world’s demand for sugar. Sugarcane
accounts for 80% of the amount of sugar produced worldwide .However; industrialization has
led to more investments in sugarcane farming for production of clean fuels, namely; ethanol
and biogas. In 2016/17, sugarcane production from more than 108 countries with a worldwide
harvest of 1.89 billion tons (FAO, 2016).This acreage under sugarcane agriculture is set to
expand as sugarcane monoculture is being favored at the expense of other food crops with
resulting impacts on food prices, availability and variability of food commodities in the market
and the livelihoods of those who had previously depended on the substituted crops as a source
of income.
The encroachment of pastoral land by sugarcane in the Afar region of Ethiopia has forced
pastoralists to supplement their livelihoods with subsistence oriented cultivation of maize and
sorghum and/or low paid wage labor like the picking of cotton (Altare et al., 2010). Further
complicating this state of affairs is the sensitive nature of the sugarcane crop that limits crop
diversification. Moreover, the selective addition of fertilizer at different growth stages
prompts varying responses. Due to the fact that sugarcane matures at 18-24 months, farmers
need to obtain an income from other crops but research by KESREF shows that only similar
crops such as sugar beets, sweet sorghum and leguminous crops like beans due to the nitrogen
fixation element crucial in sugarcane agriculture can be used to practice mixed agronomy
(KESREF, 2012).
Such crops neither have an existing market nor have they been known to thrive in the study
area. As much as sugarcane farming promises to raise the standards of living of communities
through job creation and profitable yields, it has created a cycle of poverty that threatens its
very own sustainability. In Brazil, the world’s number one producer of sugarcane over the
1
years, the sugarcane industry employs over two million laborers who mainly engage in
unskilled wage labor (Fischer et al., 2008).These wages are however below their living
standards and are unreliable as they are contracted for only six months per year and as such,
they are unable to maintain their families. The farmers are also constantly embroiled in debt as
they borrow loans to meet the cost of production which, more often than not, seems
unjustifiable by the net profits gained (Schneider, 2010).
Sugarcane plantations have also been known to flourish at the expense of natural resources,
with additional land constantly cleared to facilitate their expansion. This has led to a total
change in land use patterns in areas where sugarcane monoculture thrives. Increased
environmental degradation occurs overtime due to exhaustion of nutrients, increased water
usage and accumulation of chemical wastes. Increased water consumption in the sugar
industry is likely to undermine ecosystem services which can only have negative
consequences for poor people. Since employment on sugar farms is reconcilable with severe
income poverty, it is doubtful that the trade-off between environmental degradation and the
expansion of the sugar industry seem likely to reflect existing patterns of wealth and patronage
on the one hand and poverty and vulnerability on the other (Lorentzen,2009).Contracted
farmers have also institutional problem of feeling that they are cheated as they believe they are
weak in bargaining and negotiating for the contract on equal terms with the sugar company
(Mosoti, 1997).Farmers have no say when payments are not delayed after harvesting of
sugarcane nor can they negotiate when the produce is sub-standard. They bear the brunt in
costs as the miller still gets to deduct the cost of seed cane, transport and harvesting services
offered as well as fertilizer.
Impact of Tendaho sugar cane plantation project on the pastoralist livelihood Page 2
1.2. Problem Statement
Sugar production has started with Awash river Valley development in wonji and Methera in
1954 and 1970 respectively. The Wonji was established by Dutch company, HVA (Handlers –
Vereeniging Amsterdam) as Joint venture between this company and the Ethiopian
government.
The production of the firm has continued until the failure of the imperial government in 1974
as a joint venture. Since the imperial government failed, the sugar factories have been
nationalized and continued until now as a state property.
Ethiopia is endowed with large areas of suitable low lands, rivers and climate for sugar cane
growth. The climate and soil types in the country have both proven to be highly conducive for
sugar cane growth and productivity. Various pre-feasibility and feasibility studies of sugar
projects conducted by Ethiopian sugar industry support center share company (ESISC) have
indicated that many potential sites at main river basins are suitable for sugar cane plantation.
These include 303,500 hectares of already identified suitable net areas in 7 sites.
However, the total area developed for the production of sugar cane in the country is only about
8% of the total identified suitable areas as the majority of Ethiopian industries are agro-based
(Solomon Y., 2016).
The establishment of Tendaho sugar factory without proper institutional mechanisms and
feasibility study presents a myriad of problems ecologically, socially and economically. Being
an arid area, any extensive extractive venture would exacerbate competition for already scarce
land and water resources. High population growth coupled with declining productivity is
making the crisis vicious. More than 50 percent of the chronic drought-affected population in
the country is from pastoral areas (Biruk, 2002).
The government has invested in the industry massively and its presences are expected to be
reflected on the quality of life of pastoralist and agro pastoralist. Even though the sugar factory
have added value, farmers are yet to experience any improvement in what they are got
displaced for their land and that did not make their life improvement (in income, generation of
asset and opportunity of job) more than who were not displaced
The study area has remained largely undeveloped since time immemorial and sugarcane
farming has brought with it mass optimism towards economic prosperity. Therefore, this study
was conducted to make an empirical research to explore the overarching impact of the state
sugarcane plantation and its subsequent sugar factory from the social and economic
perspectives on pastoral livelihood in Afar Regional State by taking Tendaho Sugar
plantation/factory as point of reference. The research theme particularly focused on how the
factory and its related settlement affected the nomadic living patterns of Afar from both
positive and negative perspective of the state farm intervention.
The sugar industry is one of the biggest drivers of the economy, in Ethiopia, Africa and
globally, both directly and indirectly. It is not an industry that we can do away with altogether
without serious socio-economic repercussions. Under efficient management, sugarcane is one
of the most viable crops to grow economically compared to other crops (SUCAM, 2002).
Most of the studies aforementioned focus on the negative impacts of sugarcane farming
without focusing on the well-being of the specific community affected. The sugarcane
growing communities in different study areas are all unique in their settings and therefore,
solutions to the challenges facing the sugar industry need to be tailored to favor their very
existence. Sugarcane farming may be a global undertaking with similar problems but the
solutions need to be engineered to cater to the different socio-cultural, political and economic
characteristics of each and every community in order to achieve sustainable livelihoods.
However, it is clear that with advancements in technology, improved seed cane varieties that
mature faster and capacity building to empower farmers to embrace new and improved
methods, sugarcane farming can prove to be booming business. There’s already light at the
end of the tunnel as the global production for 2013/14 is estimated to outpace consumption,
able it at a lower rate (FAS/USDA, 2013).
1.3. Objective of the Study
The overall objective of the study was conducted to analyze the impact of sugarcane farmland
expansion project on pastoral and agro pastoral community livelihoods in Afar region in
Ethiopia.
1.3.1. Specific Objectives.
1. To describe the socio-economic, demographic and institutional characteristics of the

households who were displaced from their land and their counter factual who were not
displaced due to expansion sugarcane plantation.
2. Analyze the impacts of farm land expansion due to sugar cane plantation on pastoral of
households in Afar region.
3. To identify factors affecting livelihood of pastoralists and agro-pastoralist households of
who were displaced from their land and their counter factual that were not displaced
1.4. Research Questions
1. Which the socio-economic, demographic and institutional characteristics of the households

who were displaced from their land and their counter factual who were not displaced due to
expansion of sugarcane plantation?
2. How has farm land expansion due to sugar cane plantation on livelihood of household in afar
region?
3. What are the major factors, which affects the livelihood of pastoralists and agro-pastoralist
households of who were displaced and their counter factual that were not displaced?
1.5. Significance of the study
Amongst its strategic goals of Ethiopian Sugar Corporation, the industry seeks to enhance
competitiveness through effective, efficient milling capacity, enhanced human resource
capacity, efficient, reliable harvesting and transport operations, reduction in farm level risks
and streamlined corporate governance. This study addresses the need to fulfill the above
objective in order to make the sugarcane industry less cost-productive, thus benefiting both the
farmer, local community and the factory.
The results of this study may be used by relevant institutions and stakeholders in the sugarcane
industry as bases for capacity building and education on the effects of practicing sugarcane
monoculture so that it does not conflict with efforts to conserve natural resources while
maintaining a steady pace of development. The output obtained from this study may also be
used to advice communities on how to attain sustainable livelihoods from such high value cash
crops that always stand to take precedence over other crops, especially food crops and
substitute economic activities where they are introduced with the promise of maximum
benefits accrued, even without relaying the bigger picture to the relevant stakeholders
including farmers, Government agencies as well as Non-Governmental Organizations
involved in agriculture and natural resource management.
Hopefully, this study was set a plat form for coming up with a policy that favors farmers at
the expense of largely profitable sugar companies and also incorporate natural resource
management techniques in areas where there has been a boom in high value cash crops such as
sugarcane, tea, rice and coffee in the Ethiopian context to foster sustainable agriculture. The
study give contribution for policy and strategy feed backs, company, pastoralist community
and nearby administration, for further researchers and then contribution for the body
knowledge.
1.6. Scope of the study
Access to sugarcane out grower farms further away from the village is a challenge as there is
no reliable means of transport. This mean tiring alternative means of transport, which proved
to be costly. Furthermore, a poor road network with expansive gravel roads makes the areas
impassable during the rainy weather. Lack of existing data on the ground to backup new
information proved a challenge in showing trend sand comparisons.
The study was limited by two main constraints. The first one was the timeline. Avery short
time frame was time lined to carry out the assessment particularly for data collection and field
reconnaissance. Not going so in depth has its own impact in getting adequate information to
research work. Perhaps this is self-sponsored study which has huge cost implication. The
second constraint was geographic factor. The study area were with its harsh dry climatic
weather ( where temperature at times reaches close to 45 degree Celsius) should have
contributed against getting quality of data as it has been very difficult for data enumerators to
walk through several disperse households on foot. So such circumstances would result in the
assessment and information not to be exhaustive. Due to time limitations and the harsh nature
of the area the research systematically focused only on nearby three woredas where the
sugarcane plantation and factory is located. I was not able to further assess the impact of the
expansion of project intervention on pastoral livelihood found outside of these three woredas
.However, as much I can I try to extrapolate the data I have collected from different sources
based on the consideration of the homogeneity nature of the Afaris across the board .
1.7. Organization of the Study

This study Is Organized Into Five Chapters: Chapter One Includes Introduction/Background,
Research Problems, Objectives Of Research, Scope And Limitation Of The Study Etc /Chapter
Two: Review Of Literature, Chapter Three: Research Methodology: Methods And Tools Used
For Data Collection, Processing Data, Analyzing And Interpretation Data , Chapter Four Result
And Discussion, Analysis Of Interviewed Households , Socio-Demography , Socio-Economy
,Analysis Of Income From Expansion Of Sugarcane Production , Contribution Of Wage/
Salary, Chapter Five : Contains Conclusion And Recommendation.
Chapter Two
2. LITERATURE REVIEW
Definition and Concept
2.1 .1.Global Trends in Sugarcane Farming
The world demand for sugar is the main driver of sugarcane agriculture, which accounts for
80% of sugar produced. The rest is produced from sugar beets that grow in temperate regions.
Brazil has the largest area under sugarcane cultivation in the world, representing one third of
global harvested area and production (Fischer et al., 2009). The sugarcane industry is
responsible for quite a substantial percentage of the agricultural industry’s GDP in Sub
Saharan Africa (SSA). South Africa makes the largest contribution to the sugarcane industry,
accounting for almost 35% of the region’s total output. SSA relies greatly on its agricultural
industry where by approximately 75% of employment is provided by agriculture. There are28
countries that produce sugarcane, 11 of which can boast an output capacity of more than
200,000tonnes (Vermilion, 2011). The other countries include Mozambique, Mauritius,
Cameroon, Swaziland, Peru, Egypt, Senegal, Malawi, Sudan, Ethiopia, Zambia and Tanzania.
Sugarcane is grown on large estates or by smallholders and subsistence farmers. Large estates
(nucleus) generally produce the bulk of sugarcane but smallholders contribute quite
substantially in some countries. In Mauritius, approximately 26,000 smallholders contribute
roughly 30% of sugarcane supply while in South Africa, 12% is produced by approximately
45,000 smallholder farmers and the rest is produced by 1,729 large scale growers (Vermeulen,
2011).In the Kenyan scenario, there are about 250,000 small scale farmers who supply 92% of
sugarcane to the sugar millers, while the remainder is supplied by factory-owned nucleus
states (KSI, 2009). The three sugar factories of Ethiopia have a production capacity of 280,000
tons of sugar annually. The total area developed by these factories is 23,769 hectares. The area
developed at Wonji/Shewa is 7050 hectares (5930 hectares estate and 1120 hectares out
grower farms) capable of producing 80,000 tons of sugar per annum. The Metehara Sugar
Factory, which was brought on stream in 1969 by HVA at Metehara, developed 9919 hectares
and has a capacity to process 115,000 tons of sugar annually. The Finchaa Sugar Factory (in
East Wellega zone of the Oromia National Regional State) which was completed in 1998
developed 6800 hectares and has a production capacity of 85,000 tons of sugar per annum.
2.1.2. Plantation Sugarcane Farming and Community Livelihoods
Although the initial aim of introducing sugarcane farming in the region was to create wealth
through provision of income and employment opportunities, statistics and observations
indicate that poverty in the sugarcane growing areas remains endemic.(Otieno et al, 2003)As it
is, the sugar industry supports the livelihoods of at least 15% of the total population.(KSI,
2008). A research study on sugarcane farmers states that overall, most farmers engage in
sugarcane farming to raise income for the education of their children, acquisition of additional
property ,notably ,land and construction of decent family shelters now that thatching grass has
been eliminated through conversion of land to farming. Site specific differences in the benefits
are also a reflection of differences in the felt needs, general community cultural orientations
and education levels (Waswa et al., 2012).
For instance, many out grower farmers earn their income only to exhaustion re-payment of
debts accrued during the more than 24 months of waiting to harvest the sugarcane. Repayment
of debts reduces the farmers’ propensity to buy and/or grow food for their own subsistence;
hence the persistent food insecurity and malnutrition .As a result, cycle of poverty is born that
continues on end. Contract sugarcane farming is a costly business to ordinary farmers due to
the deductions the company undertakes, particularly from the main crop. For instance,
deduction by the company for the main crop can cost farmers upto71% loss in profits. This has
been the case all round in the sugarcane growing areas with farmers constantly embroiled in
debt as the production costs constantly overweigh the proceeds from sugarcane. Farmers are
only paid for the raw sugarcane tonnage presented on arrival at the millers’ weighbridges
while the millers retain proceeds from all the by - products. There’s also need to empower
farmers to find alternative sources of income before their cane matures.
2.2. Related Empirical Studies
2.2.1. The impact expansion of Sugarcane Production in Different Countries
Ethiopia: Domestic sugar consumption in Ethiopia is considerably higher/ 1.26 times/ than its
production. Therefore the country imports about 150,000 MT of sugar per year to satisfy
domestic demand. the sugar sector in Ethiopia faces several challenges such as : satisfying
local demand at stabile and relatively low consume price , its current production level still
cannot keep with fast growing demand for both sugar and ethanol ,stemming its complex
sugar trade policies and trading average market at both regional and global level and
unpredictable changes in the world of sugar market , international sugar price significantly and
consumers in eastern part of the country rely on illegal and cheaper imports coming through the
Djibouti and Somalia coasts affect the Ethiopia sugar industries (FAO COMMODITY AND
TRADE POLICY RESEARCH WORKING PAPER No.37,FAO 2013) According to the FAO
commodity and trade policy research working paper no.37,the expansion of sugar cane
production on farmers land shows that the higher the share of land occupied by sugar plantation
, the lower the total household and per capita income: one percent increase in sugar acreage
share leads to a 0.3 percent reduction of income .The higher the price of non-sugar crops, the
higher the income : one percent increase in the index price non-sugar crops , leads to about 0.5
percent increase in the income per capita . But the higher the wage income from working in the
sugar sector, the higher household income and per capita income. It also the cause for
displacement of farmers from their land(FAO COMMODITY AND TRADE POLICY
RESEARCH WORKING PAPER NO.37, FAO2013). The Wonji Sugar cane out grower
scheme in Ethiopia was the oldest out grower scheme in Ethiopia. As the plantation of the
Wonji-shoa sugar factory was established in an area where the surrounding agricultural land
was already in use by local communities, the factory could not expand the land area for sugar
cane production without displacing small-scale farmers. In order to increase the supply of sugar
cane, the factory initially proposed to the government and then Ethiopian Sugar Enterprise to
resettle the households who were using the surrounding land, but this plan was not approved
because of intense resistance from local communities. Thus, the resettlement plan was changed
to an out grower scheme which was considered to be a win-win solution for both local
communities and the factory. To make the scheme amenable to mechanization, the factory
decided that all household who had land along the Awash River adjacent to the factory
plantation had to participate or leave their land (Mengistu Assefa Wendimu,Arne Henningsen,
Peter Gibbon,2015/2016).
The research study on sugar cane out growers in Ethiopia shows that tomato and onion
production generates four to seven fold higher net incomes per hectares per season than sugar
cane even before taking into account the frequency with which different crops are harvested.
While tomatoes and onions can be produced twice per year, sugar cane takes 14-24 months to
harvesting. Teff, which is produced once per year under rain fed condition, generates a similar
net income per hectare to irrigated sugar cane production. Non-out growers have significantly
higher net income per adult equivalent than out growers (Mangiest Assefa, Wendimu, Arne
Henningsen, Peter Gibbon,2015/2016).
The recent rush for large - scale agricultural land acquisitions in most developing countries ,
often described as land grabbing because contract farming and out grower schemes can result
in the same advantages as large-scale farming , but avoid its main drawback , namely the
displacement of the current land- users . The participation in out grower schemes has a huge a
negative effect on the income and asset stocks of out growers whose land had a high potential
for income generation due to access to irrigation prior to participation in sugar cane schemes .
If governments encourage or even force smallholder farmers to participate in out grower
schemes and if they also want smallholders to benefit from participating in out grower
schemes, they should at least properly address the price setting issue. (Mengistu Assefa
Wendimu,Arne Henningsen, Peter Gibbon,2015/2016).
Tanzania: The inclusive business models in Tanzania aim to ensure that the existing land
users did not lose their rights to access, control and own land. They are meant to empower
communities to have a voice in business decision making processes and share benefits and risks
resulting from the business activities. Kilombero Sugar Company Limited (KSCL) in
Kilombero District, Tanzania, provides an example of some elements of inclusive business
models and their challenges. KSCL has been partnering with sugarcane smallholder farmers to
produce sugar cane that is processed, marketed and distributed by miller KSCL. The
partnership is based on a Cane Supply Agreement CSA which was signed between the
company and the farmers’ association every three years .Based on these adjustment, out grower
are paid less if the sucrose level of their cane is too low ; and all out growers are based on final
sales. Payment was done on the ratio of 57 percent to 43 percent of the profits for out growers
and the company, respectively (Emmanuel, 2014).
The inadequately planned and executed expansion of sugarcane production in the area was
causing problems for the out grower and company. This was because the production levels
have over shot the company processing capacity, leaving farmers with sugar cane that is
unharvest and unsold , and no options rather than being indebted . Recently, farmers have also
registered complaints around the measurement of their sugar cane weights and sucrose levels
by the company (Emmanuel, 2014).
Nigeria: The most of the areas in the Northern states where water for irrigation is available;
sugarcane cultivation in large quantities is feasible. Out growers scheme farming is gradually
increasing as shown by the level of experience recorded. These percentage would increase over
time as more mobilization; sensitization and incentives are provided such as : the communities
living within and around the company , appropriate pricing policy of their produce , provision
of rural infrastructure like : access to school , clinics , water supply ,electricity , feeder roads
for ease of movement of gods and service within and around the neighboring communities or
village ( * A.A .Girei and D.Y.Giroh,2012 )
The survey conducted on analysis of the factors affecting sugar cane (Saccharum officinarum)
production under the out grower scheme in Numan Local Government Area Adamawa State,
Nigeria shows that most of the respondents engaged in sugar cane production had average size
between 1-2 hectares followed by those with average farm size of 3-4 hectares .Also those with
5-6 hectares constituted 4.2% with only 3.3% of them had up to between 7-8 hectares. The
most important constraint was: inadequate and late allocation of farms constituting 33% of the
total respondents, inadequate credit facilities constituting 25% of the respondents. Inadequate
funds hinder the development of irrigation schemes as stressed by Von Pischke
(1991).inadequate water supply was ranked the third (3rd) most important factor militating
against high yield with 20% of the total respondents . (15%) of the total respondents reported
that farm inputs Such as inadequate/high cost of fertilizer, sells. It is generally known that
small scale farmers find it very difficult to source for farm inputs and the limited number they
could lay their hands on are extremely expensive .The constraints of high input cost need to be
address through government intervention by provision of subsidy ( * A.A .Girei and
D.Y.Giroh,2012 ).
Kenya: The Economic Valuation of the proposed Tana Integrated Sugar project shows that
sugar project would have both direct and indirect positive and negative impacts. Employment
creation, production of sugar, electric power and ethanol would benefit both local and National
economies. The local economies would be transformed as rising numbers of workers and their
families increase demand for goods and services, such as food, clothing, shelter and
entertainment. Sugar cane farming would involve construction of flood plain dykes. That
would restrict supply of rich silt deposits to the whole of the floodplain. It was fundamentally
affect even the floodplains that would not be converted to sugar cane farming, ecological cycle
of the whole of Tana Delta leading to loss biodiversity resources. The sugar cane project would
involve clearance of indigenous vegetation with medicinal values as well as important sources
of honey , timber , wood fuel and charcoal , which disrupting the livelihood systems of the
local communities . Loss of these resources would not be adequately compensated by the
proposed sugar project as the local communities were adequately prepared to gainfully
participate in the sugar economy (client nature Kenya consultants Dr.Caleb Mireri, Dr.Joseph
Onjala, Dr.Nicholas Oguge, 2008)
2.3. Conceptual Framework
The study is aim to identify the impact of expansion sugarcane planting on the community of
livelihoods average annual income of household at Afar Regional State. Figure 1.1
encompasses looks at both the positive and negative impacts that sugarcane farming is bound to
bring about in the study area based on studies by Fischer et al. , (2009),Netondo et al., (2010)
,Schneider , (2010) and (Waswa et al. ,2012). Sugarcane farming affects food security in terms
of food availability, variability and access. Just as well it has provides income to the farmers,
skilled and unskilled labors in the mills and the business community due to improved road and
building infrastructure that has boosted business opportunities.
However, it can have negative impact on the environment due to overutilization of water and
soil nutrients. Expensive sugarcane plantations interfere with wildlife migratory corridors
leading to increased human-wildlife conflicts. From the above studies, farmers are paid price
per tonnage of raw sugarcane by the miller with benefits such as extension services and access
to credit facilities. However, the miller benefits from sugarcane by products as well as transport
and harvesting service offered to framer.
Sugar cane farming
Farmers benefit Millers benefit
Biophysical environment
Community livelihood  Pastureland
 Income  Forests
 Food security  Shrub lands
 Education
 Air and water
 Community Health
 Investment
 Skilled/unskilled labor  clearing of land
 Food Variability /availability  Exhaustion of nutrients
 Access to school  Accumulation of Chemical
 Access to health service wastes
 Infrastructure
Positive impact
Negative Impact
 More income
 Shortage of grazing land
 Employment opportunities
 Air/water pollution
 Better health care
 Water shortage
 Better infrastructure
Figure 1.1: Conceptual framework (derived from literature research
Chapter Three
3. Methodology of the study
3.1. Research Design

The research design involved a descriptive survey of the area under sugarcane farming to
generate qualitative and quantities data. The study sought to determine the current acreage
under sugarcane farming while identifying changes in land use from pastoralist to maize
farming and ultimately to accommodate the expansion of sugarcane plantations. A descriptive
survey of the area under sugarcane farming seemed most appropriate as the study area is
remote and under-was be researched, hence the need to generate as much primary data as
possible. Since sugarcane monoculture in the area is just taking shape, the need to observe the
trends in land use from pastoralist to maize farming and now sugarcane farming necessitated a
descriptive survey in order to document this shift in detail. The tools used included
questionnaires, key informant interviews and livelihood analysis forms to generate both
qualitative and quantitative data.
3.2. Study Area

The study area is in Tendaho sugar factory, which is situated in the Lower Awash Valley of
the Afar National Regional State (ANRS), northeastern Ethiopia. The Project is located at
about 600km from Addis Ababa. It is situated at11°40'77''Nand40°57'49''E between Dubti and
Asaita Districts at an altitude of 402ma.s .l .It is a man-made dam constructed, mainly, for the
purpose of irrigation of sugarcane plantations. Tendaho sugar factory is designed to irrigate
about 60, 000 ha of land at the Dubti, Dat-Bahri and Asaita areas for sugarcane plantations.
The project is expected to benefit nearly 35,000 families living in the basin from irrigated
pasture development and animal feed from sugar by-products. During the implementation
process, a number of job opportunities have been created. It is fed by the River Awash, one
of the longest perennial rivers originating from the highlands of Ethiopia. The vast irrigable
land resources, grazing land, bush lands and the Awash River flood plain are the most
important dry land resources in Ethiopia.
Tendaho sugar factory is characterized by lowland plain and a very hot area located in the arid
zone of Ethiopia. The mean maximum temperature ranges from about 32 to 42°C and mean
minimum temperature as about 16 to 25°C.The hottest months occur from March to October
and the coldest months from November to February. Mean monthly rain fall ranges from
about 4 to 58mm.March, April, July and August receive more rainfall. Destructive high-level
wind, accompanied with dust, is very common in the afternoons of everyday. As a result, Afar
National Regional State ANRS is one of the drought- prone areas with major shocks and
hazards associated with the recurrence of drought that disrupts the livelihoods of communities.
The Tendaho sugar factory site is located within an area known as ‘Tendaho’, which forms the
center of the Afar triangle, a low lying area of land, where the East African, the Red Sea and
the Gulf of Eden Rift systems converge.
This area is filled by various types of sedimentary deposits ranging from clay to gravel,
volcanic tuffs and hot spring deposits. The Pleistocene age sediments in the area consist of
marine and lacustrine clays, silts, sandstones, siltstones, mudstones and conglomerates. The
bedrocks underlying the sedimentary rocks are Pleistocene age flood basalts belonging to the
Afar group of the Ethiopian volcanic series (Mohr, 1971).Afar, Amhara, and Tigrinya are the
ethnic groups in the study area. The m a j o r i t y of t h e sampled population belongs to the
afar ethnic group. Traditional livestock production, rain-fed and irrigation Agriculture and
selling of charcoal are the principal sources of livelihoods for most of the people. They
cultivate mainly maize, tomato, cotton, cabbage, onion and sugarcane. Cattle, camels,
donkeys, sheep and goats are the main livestock types raised in the area. Tendaho sugar
factory is initiated and ran by the Sugar Corporation of the Federal Government of Ethiopia.
Map1: Location map of study area, source, AR
3.3. Target Population and Sampling Procedures

The target population included farmers/pastoralist and their dependents/beneficiaries; laborers
in the sugarcane industry, that is, skilled, semi-skilled and unskilled; stakeholder
representatives from the key agencies involved in sugarcane farming in the area; village
elders; factory officials; field extension officers and supervisors.
Since the target population of the area under sugarcane farming was larger than 10,000, the
Fischer Formula as given by Kothari (2004) and Mugenda (2003) was used to calculate the
sample size thus:
( ) ( )
n=
Where, n = the desired sample size
Z = 1.96, the tabulated value for 95% confidence level
p= livelihood of pastoralist and agro pastoralist of household who were
benefited from land displaced was 60%. From Tendaho Sugar factory
Office
Q= livelihood of pastoralist and agro pastoralist household who were not
displaced from their farm land and pasture for expansion of sugar cane
plantation was 40%.
C=degree of accuracy expressed as a decimal (0.05 because the estimate of
the study should be within 5% of the true value)
Hence, n = 1.962*(0.6)* (1-0.6) = 369 respondents
0.052
Households were randomly sampled along main roads in the study area which acted as
transect lines to identify sugarcane farm expansion to interview in areas where sugarcane
farming is concentrated such as Dubti;183 , Detbahre 132 and Assayita 58 respondents
selected.From these three woreda 3,2 and 1 kebeles selected respectively . Stratified sampling
was used where the sugarcane farms are thinly spread out and within relatively long distances
from each other. Purposive sampling using the snow balling techniques was be used to
identify key respondents such as village elders, factory representatives, field extension officers
and officials from the key agencies involved in the sugarcane industry as listed above.
3.4. Data Collection Methods

The study based on both primary and secondary data. The primary data was collected from
individual households and focused groups using semi-structured questionnaire. The secondary
data was collected from the state farms in this case Tendaho Sugar Factory and the woreda
administrative office in order to augment the primary data. Prior to formal survey, an informal
survey was conducted to have overall information and to consider what variables need to
include during the questionnaire design. The following steps was be used to identify the sample
households /pastoralist. First, using lists of household heads in each village of the woreda,
pastoral households are to be stratified into three groups (poor, medium and better off) with
help of the local elders. Thereafter, equal sample size was randomly drawn from each stratum
totaling 369 household for the interests of time and resources limitation. In addition to
questionnaire –based interviews, a series of discussions was held with elders and key
informants along with the household survey.
Interview forms would be standardized for all respondents and used to interview key
respondents based on the information they possessed on sugarcane farming in Dubti, assayita
and Detbhari. These key informants were drawn from various stakeholders in the sugarcane
industry as stated above.
Livelihood analysis forms were used to interview the farmers and their
dependents/beneficiaries, laborers (skilled, semi-skilled and unskilled) and factory
representatives to collect information that portrayed the financial outlook of the sugarcane
industry. Information collection was be used only for the purposes of the research. Secondary
data was collected from the agricultural offices at the Regions and Woreda levels as well as
relevant institutions such as n o n governmental organizations.
3.5.1. Model Specification and estimation method
3.5.1.1 Theoretical definition

All micro econometric evaluation approaches have one aim: To find out whether a treatment
changes the outcome situation of a person and if a special land displaced is effective in
accomplishing its objectives. In the following, the effect αit of the treatment on an
individual i at time t is defined as the difference between the potential outcome YTit after
participating in the project and the potential outcome YCit without participating .
Αit = YTit - YCit ------------------------------------------- (3).

Very often, an evaluation is dedicated to estimate the mean effect that the project would have
on individual drawn randomly from the population. This is called average treatment Effect
(ATE) and can be expressed as
E (αt) = E (YTt - YCt) = E (YTt) - E (YCt) ---------------------- (4)
Where: E (αt) stands for the expected values or the averages.
If the government or owners of the Tendaho sugar factory have to decide about the expansion
of a sugar cane plantation to a wider land or to another target group, the parameter of interest is
the ATT. For other research designs, it can be of interest to only consider the impact of those
who actually participated in the sugar factory. An instance could be if policy- makers have to
decide whether to recklessness a project permanently or not. Then the Average Treatment
Effect for the Treated (ATT) is the adequate estimation:
E(αt |D=1) = E(YTt - YCt |D=1)= E(YTt |D=1) –E(YCt |D=1)------------------(5) Where D is a
dummy variable indicating treatment (D = 1) or no treatment (D = 0).
3.5.2. Estimation Method

One of the main objectives of the study is to analyze and assess the impact of expansion of
sugar cane plantation on factors affecting like: income of household, creation of employment,
making of asset, access of credit for household, access of agricultural extension and distance of
market. To examine this, logit choice model is employed to show the functional form and
relationship of average annual income of the household. When the explanatory variable(s) is
(are) non- continuous, one can represent them as dummy variable and proceed to non-linear
regression analysis. As the dependent variable is binary, (Pindyck And Rubinfeld, 1981) a
binary choice model assumes that individuals are faced with choice between two alternatives.
Thus, one purpose of a qualitative choice with a given set of attributes would make one choice
of the alternative. There are several methods to analyze the data involving binary outcomes. In
the standardized bias before and after matching (formulae from Rosenbaum and Rubin, 1985):
this should be less than 5% after matching. Almost none of the covariates is well balanced
(requires %bias after matching < 5%).But the true propensity score is never known in
observation studies, so you can never be certain that Propensity score estimates are accurate.
Due to limitation of an estimation tool and observation data can be fraught with pitfalls as
alternative iterative checking the propensity score need (Rosenbaum &Rubin 1983). Propensity
Score Matching(PSM) are generally determined by using four steps first we estimate
propensity score by using logistic or probit regression of treatment condition on the vector of
covariates.
The model for determining of project intervention on household for rising of income and asset
of household is used PSM (propensity score matching). Propensity score can be done through
four steps and measurement. Logistic Regression The most commonly employed method for
estimating propensity scores is logistic regression (Austin, 2011; Stuart, 2010).
Logistic regression is a robust statistical technique that allows the use of continuous and
categorical predictors (Tabachnick & Fidell, 2013). Because the covariates predict a binary
variable (i.e., participation or not participation), the generalized linear model is used and a link
function transforms the binary dependent variable into a binomial distribution (i.e., an “s”
shaped distribution). To calculate propensity scores using logistic regression, the set of
covariates (i.e., confounding variables) are entered as predictors of the binary outcome.
Logistic regression employs maximum likelihood estimation (MLE) to explain the maximum
amount of deviance in the model (Azen & Walker, 2011). Household predicated participation
on the project becomes the logit(Y), the logit or log-odds of participating in the project, and the
simple regression equation is:
Logit(Y) = þo + þ1x1 + þ2x2+… þixi+µ
Where x1, x2… xi is covariates or independent variables and þo, þ1… þi are coefficients and µ,
error term. And Y is outcome (impact of displaced from land) =average annual income of
households.
Second steps in evaluating propensity score is matching. Once propensity scores are
computed, there are numerous approaches for creating a comparison group of nonparticipants
including exact matching, nearest neighbor (NN) matching, optimal matching, and nearest
neighbor with caliper adjustment (Austin, 2011; Caliendo & Kopeinig, 2005; Stuart, 2010;
Stuart & Rubin, 2008b). However, the most commonly used approaches, and the methods
applied in the current study, are NN and NN with caliper. Additional considerations include
the number of nonparticipants to be matched to each participant and also whether replacement
(i.e., matching nonparticipants multiple times to participants) is allowed.
The step of checking quality of matches diagnosed to ensure the comparison group has a
distribution of propensity scores similar to participants. Several approaches exist to diagnose
matches including comparing the balance numerically and visually (Caliendo & Kopeinig,
2005; Stuart, 2010). There was no lack of consensus in the literature regarding the use of null
hypothesis significance testing (NHST) analyses (e.g., t-tests) to diagnose the quality of
matches on the covariates and composite propensity scores (Caliendo & Kopeinig, 2005; Ho et
al., 2007; Rosenbaum & Rubin, 2006; Stuart, 2010).The finally steps in developing propensity
score matching method was determined the effect of project intervention on participants called
as average Treatment Effect on treated (ATT). Assumption on the matching for all non-
experimental techniques, assumptions have to be made to identify the causal effect of a policy
or project on the outcome of interest. The method of matching is based on two ’identifying
assumptions’.
A1) First, the so called Conditional Independence Assumption (CIA) claims that the outcome
of both treated and untreated individuals must be the same if one controls for observable
differences in characteristics.
This can be expressed formally by:
(Y T, Y C) II D|X
As II is a sign for independence, the assumption can be phrased as follows: The potential
outcomes of the treated and untreated individuals are independent of the treatment status
conditional on all relevant pre-treatment covariates X . This implies that selection is only
based on observables and all covariates X both influencing the treatment status and the
outcome are considered in the model. In other words, after controlling for X, the treatment is
effectively assigned randomly.
A2) The second assumption is known as the Common Support Condition stating that the
treatment status must not be perfectly predictable, such that there is still variation between
participants on nonparticipants. Individuals with the same characteristics must have a
positive probability to be in the treatment as well as in the control group. In technical terms,
this condition states that the probability to be treated lies between zero and one, conditional on
each value of X, thus:
0 < P (D = 1|X) < 1
Different matching criteria can be used to assign participants to non-participants on the

basis of the propensity score.
Nearest-neighbor Matching
One of the most frequently used matching techniques is NN matching, where each treatment
unit is matched to the comparison unit with the closest propensity score. One can also choose
nearest neighbors and do matching (usually n = 5 is used). Matching can be done with or
replacement. Matching with replacement, for example, means that the same nonparticipant can
be used as a match for different participants (khandker et al., 2010) therefore ATT is the
difference between the outcome variables of social relation, school environment, problem
solving, trouble thought and felling, home environment on each treated and control groups. In
this method, the absolute difference between the estimated propensity scores for the control and
treatment groups is minimized. The control and treatment subjects are randomly ordered. Then
the first treated subject is selected along with a control subject with a propensity score closest
in value to it.
C (Pi) = min | Pi -Pj |
C (Pi): represents the group of control subjects j matched to treated subjects i (on the
estimated propensity score)
Pi: is the estimated propensity score for the treated subjects i
Pj: is the estimated propensity score for the control subject’s j.
Kernel Matching
One risk with the methods just described is that only a small subset of nonparticipants will
ultimately satisfy the criteria to fall within the common support and thus construct the
counterfactual outcome. Nonparametric matching estimators such as kernel matching and LLM
use a weighted average of all nonparticipants to construct the counterfactual match for each
participant. In this method, every treated subject is matched with the weighted average of the
control subjects. The weights are inversely proportional to the distance between the treated and
control group’s propensity scores.
Radius Matching
One problem with NN matching is that the difference in propensity scores for a participant and
its closest nonparticipant neighbor may still be very high. This situation results in poor matches
and can be avoided by imposing a threshold or “tolerance” on the maximum propensity score
distance (caliper). This procedure therefore involves matching with replacement, only among
propensity scores within a certain range. A higher number of dropped non-participants is likely,
however, potentially increasing the chance of sampling bias. In this method, every treated
subject is matched with a corresponding control subject that is within a predefined interval of
the treatment subject’s propensity score. Since each of the treatment subjects must be matched
with a control subject with a given interval, only a certain number of comparisons will be
available.
Stratification Matching
This procedure partitions the common sup-port into different strata (or intervals) and calculates
the project’s impact within each interval. Specifically, within each interval, the project effect is
the mean difference in outcomes between treated and control observations. A weighted average
of these interval impact estimates yields the overall project impact, taking the share of
participants in each interval as the weights. Propensity score matching approach is used to
examine the impact of participation in Tendaho Sugar factory intervene activities on
household income Increase . The method compares generating asset per year households with
their counterfactual group that did not participated into such activities, depending on land
holding with household size.
The propensity scores are predicted with logit model (Sianesi, 2004). The assumption of the
conditional independence of the score result extends the use of the propensity scores for the
computation of the conditional treatment effect. The predicted propensity scores are used to
measure the treatment effect. According to Becker & Ichino (2002), average treatment effect
on the treated (ATT) is the parameter of interest in propensity score matching analysis. Thus,
we use ATT to assess the impact of who got displaced land on household wellbeing. ATT is
computed by matching displaced and not displaced households that are closest in terms of their
propensity scores. In this study, the treated group is referred to as displaced households and the
ATT is calculated as follows:
ATT=E (T/1=1) =E(Y/1)/D=1)-E(Y (0)/D=1) ---------------------- (7)
Where E(Y/1)/D=1 represents the expected for households who taken their land by project and
E(Y (0)/D denotes the counterfactual incidence of income on households. The counterfactual
estimates represent what are incidences of income for those household who are if they have not
engaged in sugar factory project impact of activities.
A number of matching techniques have been suggested in the literature to match enterprise and
non-enterprise households of similar propensity scores to compute the ATT. However, this
study employs radius matching technique, which uses all of the comparison units within a pre-
determined radius. The advantage of this method is that it uses as many comparison units
available within the radius, thus allowing for the use of extra units when good matches are not
available.
3.5.3.Description of Dependent and Explanatory Variables

By considering livelihood of pastoralist and agro pastoralist household’s impact of
expansion of sugar cane plantation on displaced from their land: landholding, income of
household, creation of employment, making of asset, access of credit, access of agricultural
extension and distance of market.
3.6.1. Demographic and Socio-Economic Variables
Sex (gender): this is a dummy variable which takes a value 1for a house hold if the
household head is female zero otherwise. Gender differential among households play a
significant role in economic performance of a given household. Some empirical studies have
demonstrated that gender is important in defining the economic role of rural people in
Africa 2(Sweeney M.D. Dy1980, Addis, et al.1999).
The empirical study made by (Sweeney M.D. Dy, 1980, Addis, et al.1999) of gender specific
attitude towards family care and house management support this agreement.
Household size: this refers to the number of persons in a given household. This variable
dictates as the size of the house hold increases the likelihood of exposure increases on poverty.
Age: this variable has a continuity characteristic. It is supposed that as the house hold head gets
older his/her ability and physical capacity to perform their day to day activities are expected to
decrease.
Education background: This takes a value ‘0’ for “no education background”, 1 “primary
education”, 2, for “Secondary education” and 3 for Tertiary education level. And then as
education of household head increase by one unit, the benefit of employment in the project and
the probability of generating income will increase.
Location of household: This independent variable indicates the household of location around
the project i.e. Tendaho Sugar factory of study area. Assigned by 1(one) for Dubti, 2(two)
Detbhari and 3 (three) for Assayita.
Land holding: The holding or farm may consist of one parcel of land or several parcels. In term
of size, a holding or farm is any agricultural with a minimum of at least one hectare cultivation
crops including, maize and sorghum and also vegetables.
Average annual income household: are earned through cultivation of crops, livestock, and
nonfarm business through wage /salaries employment. So this study analysis the average annual
income of household.
Households Asset: are anything the household own with monetary value like TV, radio, mobile
and watch are electronics and like carts, water pump and others ,Bank account and association are
assets for respondent.
3.6.2. The Intervention Project
This study used Expansion of Tendaho Sugar Cane plantation to dedicate its impact on income in
rural study of Afar region. Tendaho sugar factory brings together several interventions, which are.
These interventions affect a wide range of direct outcomes, beyond just income outcomes. As a
result, the evidence is complex and, therefore, difficult to classify. Nonetheless, expectations on
the quality of evidence needed to justify interventions have increased in recent years, and
consensus has formed around rules of best practice for analysis, weighing and combination of such
evidence. However, aside from RCTs and their meta-analysis, there are a wide range of
observational study designs, including ecological, cohort, cross-sectional and case-control studies,
some of which do not have a specified intervention and/or control. Increasingly in the Tendaho
Sugar cane plantation sector, various econometric methods are also being employed to interrogate
cross-sectional and longitudinal data to address important questions (Spears, 2012).
The impact of expansion of sugar cane plantation have many activities of intervention to increase
of the livelihood pastoralist basically like income, asset and in the job creation implemented by
Sugar Factory. The intervention activities which were simultaneously delivered by facilitators
and coordinators of expansion sugar cane plantation project as making asset, improving the
livelihood of pastoralist income.
3.6.3. The dependent variable
The outcome is measure the mean difference between treated group and untreated group in the
observational study samples by the tool/ method of propensity score matching.
Table 3.1: Summary of Variables description included in the Model
No Name of variables Code Variabletype Unit
if 1=Dubti,2=Detbhari
1 Location of household locnhh categories and 3=Assayita
2 age of household agehh Continuous in number
3 Sex of house hold sexhh categories if 1=male, 2=female

4 household size hhsize Continuous in number
area holding of household
5 before the intervention arhbei Continuous in hectare
area holding of household after
6 the intervention arhafi Continuous in hectare
average income of household
7 before intervention avinhhbei Continuous in birr
asset of household before
8 intervention asshhbei Continuous in birr
asset of household after
9 intervention asshhafi Continuous in birr
if 1=long
dist,2=medium
distance of market from distance and 3= short
10 household location distnmkt categories distance
Access of agricultural extension
11 service agriex categories 1=Yes, No=2
1=single,2=married
12 Marital status marstshh categories ,and 3=divorced
13 Access credit for farmers accecredhh categories 1=Yes, No=2
benefit from Sugar factory by 1=no benefit and
14 employed benefitofhh categories 3=income
0=No edu,1=primary
,2=secondary and
15 education level of household educhh categories 3=tertiary
Table 3.2: Summary of Outcome Variable description included in the Model
no Name of the variables Code Variable Unit
type
1 Average annual income of household Avaihh continuous birr
CHAPTER FOUR: RESULTS AND DISCUSSTION
4. Introduction
This chapter mainly presents descriptive statistics results, econometric analysis and predicts the
impact of the expansion of sugar cane plantation using average treatment effect on treated (ATT).
The descriptive results analysis discussed on different method, by using mean, standard deviation,
frequency, percentage, minimum and maximum values of some important covariates. In addition,
some of the analysis would put in tables graphs and figures. Finally the study emphasis the main
finding of observation study impact of expansion sugar cane plantation on beneficiary of
household, analysis sensitivity and robustness of average treatment effect on treated (ATT).
4.1. Descriptive statistical analysis
The study focus on how does the sugar factory effective in increase the benefit of household in
study area of Afar. The estimation of impact of the intervention is determined by propensity score
matching method. The intervention is in generating income, in making asset and assessing their
impact in benefit of land displaced as a package rather than separately.
The project supports community by creating job and the project covered about 60% of the rural
residents so that participants are 60% of total population and non-participating on the project are
40%. The pretreatment covariate or background covariates are grouped under socio and
Demographic characteristics, others variables which affect outcome and intervention
simultaneously. The sample size is 369 from total above 10,000 population size and the treated
group is 221 and non-treated 148. The treatments are coded by”1” and the control by “0”.
4.1. 1.Socio-Demographic Characteristics of the Study

Under this section the socio-demographic characteristics variables includes sex, education level,
age, location and family size were analyzed statistically and see if there are mean difference
between pastoralist and agro pastoralist households of who were benefited from land displaced
and their counter factual who were not displaced due to plantation covariates using F-Statics.
4.1.1.1. Sex composition of Respondent
In the statistical description of sex composition analyzed frequency of male and female
participated in the project as well as not engaged in the project and. And determined that sex’s p-
value is 0.103 which is significant at 10% probability level were displaced, thus no difference
between the participation on the project and not participated on the project regarding sex before
matching.
Table 4.1 sex composition of respondents of observation study
Treament
Sex of household Not participate participate Total F-value
131 188 319 1.72*
Male 88.51% 85.07% 86.45%
17 33 50
Female 11.49% 14.93% 13.55%
148 221 369
Total 40.00% 60.00% 100.00%
*implies significant at 10% probability level

Source own sample Survey, 2019
4.1.1.2. Education background level
Generally The majority of interviewed households living in these area (42.71% of household have
no education), while 28.91% have primary education .20.31% have Secondary level Training and
8.07% educated to college standards. The statistics show that access to education is low and so are
the literacy levels in the area. There are many cases of the elderly people having no formal
education just like level of literacy among women. Among cohort’s school age children, school
enrollment and attendance rates are poor, especially among pastoralist. This is due to myriad of
factors including :-long distance to schools, high pupil teacher ratio, limited resource to run
schools, dilapidated incomplete buildings, gender disparities, lack of school feeding project and
early and forced marriages.
Table4.2. Educational levels of hold
Treatment
education level of F-value
household Not participate Participate Total
4.57***
49 109 158
no educated 34.42% 48.26% 42.71%
43 63 106
primary 29.22% 28.70% 28.91%
41 35 76
secondary 26.62% 16.09% 20.31%
15 14 29
tertiary 9.74% 6.96% 8.07%
148 221 369
Total 40 60 100
***implies significant at 1% probability level
Source own sample Survey 2019
4.1.3. Age Characteristics of the respondents
The mean age of the respondents in the study which were engaged to project are 38.14 and which
were not participated to project are 36.14
The F-Static age of the respondents in the study which were between engaged to project and
which were not participated to project are 0.90.This implies that the distribution mean is not
significant. The age of respondents can’t affect the project participation, there is no difference in
outcome between engaged in the project and not engaged in expansion of sugar cane plantation
since p-value is (0.6403) which is not significant.
Table 4.3 Ages of participant and non-participant
Treatment mean sd min max N F-vaue
not participate 36.14 9.07 21 65 148 0.9
participate 38.14 9.21 20 65 221
Total 37.34 9.2 20 65 369
4.1.1.4 Family size of households

The study asked respondent how many family members include in the household mainly to
assess the impact of expansion of sugar plantation on their land positive or negative in increased
or decreased of varied size of families in the households. As indicated below on the table (4.4).
The mean family size of respondent participated on the project is (5). Where us, the mean family
size of those not participated on the project is (4). The p-value of family size (0.00) which is
significant this indicates that due to family size differences participate and non-participated
during the impact of expansion sugar cane plantation,
Table 4.4.The Distribution of Household size
Treatment mean sd min max N F
not participate 3.94 2.54 1 10 148 4.54***
participate 5.17 2.82 1 10 221
Total 4.68 2.77 1 10 369

4.1.1.5 Marital Status of Household
Table4.6. show us that the household reported to be single (6.25%) categories were
predominantly not participate taking up to 9.09% compared to only 4.35% for participate Over all
90.36% of the sample was married during the study period. There was considerable variation
among the study of not participate and participate which is 87.01% and 92.61% respectively. And
also 3.39% i.e. not participate 3.9% and participate 3.04%.The preason chi-square test reported
confirms the difference in martial between not participate and participate significant. P-value of
0.1476 means no significant difference between the treatment categories of marital status.
Table4.5. Categories of marital status between not participate and participate
Treatment
marital status of F-Value
Not participate Participate Total
household
14 10 24 1.92*
single
9.09% 4.35% 6.25%
130 206 336

married
87.01% 92.61% 90.36%
4 5 9
divorce
3.90% 3.04% 3.39%
148 221 369

Total
40.00% 60.00% 100.00%
*implies significant at 10% probability level
4.1.2.1. Land Holding of the Household
The Minimum land holding per household was 0 hectare and the maximum was 15 hectare before
intervention and the land holding after intervention was 0 minimum and 7 maximum. On average
2.69 hectare or 60% of the farmers land were under the expansion of sugarcane production, the
remaining 40% was still used for cultivating other crops rather than sugarcane production .
However, it has been planned to come under expansion of sugarcane production.
Table.4.6 Distribution of Area holding of the expansion of sugar cane plantation between
household who from their land displaced and who were not displaced.
not participate 6.5 4.97 0.5 15 148 51.04***
participate 7.06 4.33 1 15 221
Total 6.84 4.6 0.5 15 369

*** implies significant at 1% probability
area holding after intervention
not participate 2.69 2.48 0.5 7 148 8.1***
participate 3.05 2.14 0.5 7 221
Total 2.9 2.29 0.5 7 369

*** implies significant at 1% probability
The p-value of area holding in hectare of the expansion of sugar cane plantation is 0.001 which is
significant this indicate that due to area holding difference participate and not participate which
have change on the pastoralist and agro pastoralist livelihood in increasing income .
4.1.2.2. Average annual income of household before intervention of the expansion sugarcane
farmland
Table4.7.One-way Treatment average annual income tabulate

Summary of average annual income of household
Treatment before intervention in birr
mean St.Dv Freq. F-Value
Not Participate 128417.14 149155 148 0.35
Participate 136939.34 132190.3 221
Total 133521.52 139114.4 369

4.1.2.3. Asset of household
Asset is one of the independent variables which affect positively or negatively of pastoralist and
agro pastoralist from expansion of sugar cane plantation. From this we can understand that who
are participated and not participated in the project of total mean asset reported were 12,498.39
and 16,719.22 birr of the categories before intervention of project.
The p-value was 0.00 means no significant difference between the treatments of categories of
asset in treated and controlled group.
Table4.8 Categories of asset between not participate and participate before the intervention.
Treatment Summary of Asset of household before intervention in birr

Not Participate 16719.221 16235.62 148 7.98***
Participate 12498.39 12937.21 221
Total 14191.12 14479.79 369
Treatment Summary of Asset of household after intervention in birr

Not Participate 26226.299 21863.99 148 13.07***
Participate 19139.783 1648.706 221
Total 21981.771 21981.63 369
*** implies significant at 1% probability level
4.1.2.3 Characteristics of Distance of market from house hold of house

Table 4.9.Shows how the household travel to market was related to both the beneficiary from
displaced for their farm land because of expansion and who were not displaced distance to the
closest enteral market town and its average classified into three equal groups based on distance to
the closest large market town –within 7kilometres (close), between 7and 15 kilometers (middle)
and further than 15km (far) a clear relationship between these three variables. Local markets are
most often present at middle distances. But the study shows that 50.00%of sampled travel to
market to sell and buy far from their house, 34.38% middle distance and 15.63% are close to the
local market.
Table4.9 Distance of Market categories
Treatment
Distance of market F-Value
from house of Not participate Participate Total
household
66 116 182 3.33**

far
46.10% 52.61% 50.00%
49 80 129
middle
32.47% 35.65% 34.38%
33 25 58
closest
21.43% 11.74% 15.63%
221 369
Total 148
40.00% 60.00% 100.00%
**implies significant at 5% probability level
4.1.2.4 Access to Agricultural Extension Service

Access to agricultural extension service has a positive impact on improving production of
livestock and crop of pastoralist and agro pastoralist households. From the sampled 69.79 % of
household get Agricultural extension service from extension office and 30.21 % not get the
service. The P-value is 0.00 which are highly distributed with each group and significant this
indicate that due to the access of agricultural extension difference participate and not participate
which have impact of expansion sugar cane plantation.
Table4.10 the distribution of access to agricultural service
Treatment
Access to agricultural Not F-value
Participate Total
extension service participate
67 45 112 27.73***
No
44.81% 20.43% 30.21%
81 176 257
Yes
55.19% 79.57% 69.79%
221 369
Total 148
40.00% 60.00% 100.00%
4.1.2.5. Benefit of household from employment of at the sugar factory
Table4.11. shows the distribution of benefit from employment of sugar factory
Treatment
benefit from F-Value
employment of sugar Not participate Participate Total
factory
110 160 270 0.34

Nothing
74.03% 71.30% 72.40%
38 61 99
income
25.97% 28.70% 27.60%
148 221 369
Total
40.00% 60.00% 100.00%
The p-value is 0.559 which is not significant at any point

4.2. Main Findings and Discussion.
This study is considered how Tendaho sugar factory affect were expansion. The potential
variables added to the model for finding the impact of pastoralist and agro pastoralist of household
who got benefit from displaced for their farm land and who are not displaced from their land of in
aspect of generating income, making asset, opportunity of employment ,distance of market from
household and access of agricultural extension service .
Descriptive statistics of the observable variables for exposure and non-exposure households
clearly shows that there are significant differences between the two groups. This indicates that
there is possible selection bias in the sample, which necessitates matching of households with
similar characteristics from the two groups before computing the impact of expansion of sugar
cane planting. Matching of households exposure and non-exposure households was undertaken
within a region of common support in order to ensure that individual households with the same
covariates have equal chances of diversifying into non-farm enterprise activities.
A test of the balancing property was also conducted and the results show that matching property
was satisfied. This implies that the distribution of the conditioning covariates did not differ
across the treatment and comparison group in the matched samples.
The pstest after the match shows that the probability value all the covariates in the logit model
are not jointly significant. The jointly all probability covariates of before matched p-value is
(0.000) which is significant there is a mean difference between participated on project and not
participated on the project thus need match balance according to their propensity value. After
matching the integrated the p-value is 0.351 is not significant so that null hypothesis is accepted.
The null hypothesis assumption assumes participated and non-participated mean value are equal,
there mean difference is zero. This confirms that there are no pre-treatment differences between
the participated on the project and non-participated on the project households; meaning that the
self-selection bias has been removed, satisfying the matching requirement for computing
treatment effects on treated. As indicated on table 4.13 almost all covariates are balanced and
integrated p-value described as 0.351 which is not significant, thus null hypothesis accepted as
mean difference between covariate of participated and non-participated on sugar factory is zero.
Now improve matching by using of radius matching, Kernel matching, Caliper Matching and
Nearest Neighbor matching of compute the impact of project (access to agricultural extension,
generating income and making asset).
Table 4.12: Balance of covariates of the project

Null
P-value before p-value after
Independence variable hypothesis
match match
after Match
socio-demographic characteristics
sex of household 0.1903 0.365 Accepted
age of household 0.6403 0.986 Accepted
family size 0.037 0.333 Accepted
education background 0.000 0.097 Rejected
Marital status 0.148 0.646 Accepted
Socio-Economy variables
area ( ha)holding before intervention 0.0001 0.005 Rejected
area ( ha)holding after intervention 0.000 0.009 Rejected
average annual income of household
0.560 0.664 Accepted
before intervention in birr
Asset of household before
0.0050 0.929 Accepted
intervention
Asset of household after intervention 0.0003 0.136 Rejected
Distance of market from 0.0369 0.070 Rejected
Access to agricultural extension
0.000 0.0020 Rejected
service
benefit of household from
0.559 0.600 Accepted
employment to sugar factory
Average p-value 0.00 0.351 Accepted
The propensity score, probability to be treated value predicted for the independent variables age,
sex, educational background, marital status, family size, area holding, asset of household, distance
for market, access to agricultural extension service and benefit from employment to sugar factory.
The log it model was employed calculate to the PS core value. After the pscore value prediction
different matching method was applied.
The treatment variable is impact of expansion sugar cane plantation on pastoralist and agro
pastoralist household livelihood (average annual income of house hold) and the region of common
support is those (pscore) propensity score within the range of the lowest and highest estimated
value for wellbeing of the household. This study the output shows that the recognized region of
common support is [0.1326, 0.9114], to see if we have enough overlap between the treatment and
control group to make reasonable comparisons and the final number of the block is 6.
.2 .4 .6 .8 1
Propensity Score
Untreated Treated
Figure 4.propensity score

This shows the treated in red on top and the controlled cases in blue on bottom .the graph alone
does not look promising : almost all the control cases have propensity scores concentrated from
0.2 to o.8 there seem to be high , if any ,control cases with propensity scores greater than 0.2.
There are treatment cases everywhere, but most of them appear to be concentrated above
propensity score of 0.5.
Looking closely, it seems like we might be okay we can plot a histogram of control cases with
propensity s scores greater than 0.1. Just to cut of them so we can better see the frequencies at
the top end.
2.5
2
1.5
Density
1
.5
0
.2 .4 .6 .8 1
psmatch2: Propensity Score
Figure 5 Psmatch2: propensity

From this it is clear that there are control cases that span the full range of propensity scores there
just are not that many of them.
4.2.1. Focus Group Discussion
In this study, parents and facilitator was interviewed considering their livelihood improved due to
increase average age household, average income and level of education. The sugar factory of
project expand the project according to their capacity and budget funded for the project expansion
specifically at pastoralist and agro pastoralist household, holding farmland , job creation and
others sectors which have correlations with impact of project.
There is huge problem regarding to supply of food security as Afar region is hot and water need
more for increase of Factory was asked issues related to their way of increasing livestock
production and supporting roles in increasing income of household, increasing the ability and
community what the change of Tendaho sugar factory project in 7 year ago and what indicators
they observed. Pastoralist and agro pastoralist were also asked about the changes they believed
the project brought on their income and also their perception of their role in sending, following
and practicing in the project. Household think about the project is less important especially for
decreasing their farm land, grazing land, increase distance to feed their livestock thus make highly
duty for household how to increase income and support vulnerable family and mobilized the
community to, hand over vulnerable children problem by the society, after school and at night
time he/she more concentrate discussion with friends, study and do homework. The project
effectiveness is needed ownership of the stakeholder in day to day activities and planning project
region for expansions sugar plantation. Basically household reported that the improvement of their
livelihood not enough support from concerned body. They believed their income could be
improved more if the project progressed to ever community partnership for those not practiced the
project or related.
Data gathered as quantitative and qualitative from Tendaho sugar factory officer, dubti agricultural
office and direct interviewed of who got displaced from their farmland because of expansion sugar
cane plantation and not displaced of the project with similar characteristics before treatment.
4.2.2. ATT Estimation Impact of Expansion Sugarcane Plantation Project on Pastoralist and
Agro Pastoralist of average annual income of household.
In order to observe the impact of Expansion Sugar Factory on pastoralist and agro pastoralist
livelihood of average annual income, the study utilized various score matching techniques
including nearest matching, kernel matching, radius matching. Nearest-Neighbor Matching: This
command to estimate Average treatment Effect on treated group using nearest-neighbor matching
is “attnd”. From the following result of nearest-neighbor matching the expansion sugar cane
plantation project have significant effect on Pastoralist and agro pastoralist livelihood average
annual income (t= 0.394). And Average Treatment Effect of the Treated Pastoralist and agro
pastoralist livelihood annual average income increase by 15,350.171 birr for those got displaced
for their land due to expansion sugar cane plantation.
Radius Matching: This command to estimate Average treatment Effect on treated group using
Radius matching is “attr”. From the following result of Radius matching the expansion Sugar cane
plantation have significant effect on pastoralist and agro pastoralist average annual income (t= -
0.316). And Average Treatment Effect of the Treated of the pastoralist and agro pastoralist
livelihood decreased average annual income by 9,498.346 birr for those got displaced for their
land due to expansion sugar cane plantation.
Kernel matching: This command to estimate Average treatment Effect on treated group using
Radius matching is “attk”. From the following result of Kernel matching the expansion of sugar
cane project have significant effect on pastoralist and agro pastoralist livelihood (t= -). And
Average Treatment Effect of the Treated of pastoralist and agro pastoralist livelihood average
annual income decreased by 985.346 birr for those got displaced for their land due to expansion
sugar cane plantation.
Overall the results obtained by attk. and attr are quite different to each other and taken together
give evidence of negative ATT in the range 985.346 to 9,498.421 birr. But the attnd give positive
ATT which is 15,350.171 implies us there is high average mean difference between the treated
and control group, for the reason treated observation almost the same to the control. For those
reason the radius is selected to show the impact of expansion sugar cane plantation.
Table 4.13: Average Treated effect on Treated (ATT) of different matching
Type of matching Number of match treated ATT Std.Err T-Test

method Treated control
participant non- participant
Nearest neighbor 221 134 15,350.171 38,976.39 0.394
Kernel 221 148 -985.346
Radius 221 148 -9498.421 30,062.29 -0.316
Table 4.14: The mean of impact of expansion of sugarcane plantation on average annual
income of household for control and treated group
Variable Sample Treated controls difference Strd.Err T-stat

Average annual Unmatched 239517.094 219091.425 20425.6695 27671.656 0.74
income in birr ATT 239517.094 254012.663 -14495.568 40176.615 -0.36
4.2.3. Checking Robustness of average treatment effect (ATT)

There are several ways to check the robustness of the findings. One approach is to estimate the
propensity score equation and then using different matching methods. Another way to check
robustness is to apply direct Nearest-neighbor matching instead of estimating propensity score
equation first with use of Stata command nnmatch to execute the robustness. If both methods give
the similar results, the finding assumed to be more reliable.
The average treatment effect on the treated was best according to the propensity score matching
model which was done through the STATA project of robustness of ATT. the result was present
the value of z was all greater than two and the p- value all are zero this indicates that the outcome
variable are significant at 5% level. The result shows the propensity matching model was strong.
And the value of p increases after matching and 3. The value of Robustness of Average treatment
Effect on Treated (SATT) is 3940.299 birr which is consistent to other matching thus the finding
is more reliable.
4.2.4. Sensitivity Analysis
Unlike in a randomized experiment, in an observational study subjects are not assigned to

treatments randomly. This presents a challenge for drawing inferences about whether a treatment
has an effect on subjects’ responses. Particularly problematic are unobserved confounders:
unmeasured covariates that may impact both whether a subject is treated and what his response is
after treatment. A sensitivity analysis may be used to assess how inferences would change if there
existed confounder with a hypothesized relationship to treatment and/or outcome. Foundational
work in sensitivity analysis is reviewed in Rosenbaum (2002, 105-170). But randomization
inference requires that all relevant pre-treatment covariates have been taken into account when
constructing the matched sets. A sensitivity analysis is useful when this requirement may not
hold.
In general, a sensitivity analysis allows the analyst to describe what the null distribution could
look like—and thus, how inference should change—in the presence of an unmeasured pre-
treatment covariate, or confounder. Assumptions and some notation for simultaneous sensitivity
analysis follow, drawing very heavily on the exposition in Gastwirth et al. (1998) and Small et al.
(2009), to which I refer the reader for important detail and more general results.
CHAPTER FIVE: CONCLUSION AND RECOMMENDAT
5.1. CONCLUSION
The researcher paper is focus on observational survey of particular intervenes on one particular
outcome. The observational study estimates the finally needed impact result using Stat Model as
basic instrument. This study employs propensity score matching (PSM) technique to examine the
impact of Tendaho sugarcane plantation (income, asset and benefiting from job creation)
activities on household poverty reduction, using observational study survey data of rural
households in Afar. The researcher determines effect of the activities as package rather as
individual effect.
The study evaluated the impact of expansion sugarcane plantation by interviewing the pastoralist
and agro pastoralist who got displaced for their farmland and not displaced. The matching result
shows that impact of Tendaho sugarcane plantation project activities have a positive and
statistically significant effect on the improvement livelihood of the rural households in the study
area. This finding is consistent with the widely held view in the literature study; the impact of
Sugar cane plantation project activities plays a vital role to improve wealth status of household.
Cross-sectional data form both participant and non-participant sample were used to analysis
descriptive statistics (ANOVA, F-static and other) and PSM for econometrics model were
employed. The primary data for the study was collected 369 by using structural questioner sample
from this 221 were got displaced in the project because of take their land for sugar cane
plantation and 148 were not displaced on the project.
Pretreatment characteristics like socio-demographic variables and socio-economy which were not
intervened in the project their matching were done to calculate the ATT (average treatment effect
on treated). The pretreatment covariates are categorized as socio-demographics characteristics
and agricultural extension service and other economy related variables. The variables illustrated
in the model were previously used by others researches. The independent variables under socio-
demography are age of respondents, sex, and family size in household, marital status of
household and educational background. Independent variables, area holding by household before
and after intervention, average income before and after, asset of household, distance of market,
access to agricultural extension service.
The outcome variable/ dependent variable were impact expansion of sugar cane plantation in the
households. The vital role of income and asset and distance to travel market in rural and
urban livelihoods should be appreciated as benefit from creation of job by the factory and
education are an essential factors for improving livelihood of household through attaining and
enhancing people’s wealth. Some pretreatment variables were found to be significant assuming
other factors constant like area holding in hectare, access to agricultural extension service,
benefiting in creating job in large so matching must be applied for their difference between
participated on the project and not participated on the project.
The model of Stat to determine ATT was run step by step from finding propensity score up to
estimating the finally result effect of the project. The radius matching method was good to match
explanatory variables and to estimate outcome, impact of expansion sugar cane plantation. The
ATT results indicate the project have positive and negative impact on average annual income.
The impact affect by -980 up to 15,300 birr as intervention of Tendaho Sugar cane plantation
project.
In general, Tendaho Sugar cane plantation project have influential on improving the livelihood of
pastoralist and agro pastoralist and keeping daily work more effective so that to determine the
effect of project data sample size and bias selection removing method is vital in findings and
giving consideration comments on the project.
5.2. Recommendations
The researcher depending on discussion with community got displaced from the project as well as
with those not displaced from their land, facilitator and overall view of the project expansion on
strong side and weak side which have effect on their livelihood. Based on the findings of the
results and statistical value the researcher draws the following recommendations.
 As land ownership right of farmers is limited due to the expansion of sugarcane production
other than land right to rent, sell, change, mortgage being the displaced packages
determined, the benefit package should consider the forgone income opportunities.
 A join committee composed of different key stakeholder including communities should be
established at each Administrative level that can be responsible to negotiate issues of a
common nature for timely solutions before it causes as impediment factor for the
expansion of sugarcane production on farmers land.
 For any issues connected to expansion of sugarcane production on farmers land,
community’s awareness level should also be improved using different capacity building
techniques including workshop, training, group discussion etc.
 The infrastructural development for displaced farmers due to expansion of sugarcane
production such as: road, potable water, electrification, education, health, housing etc.
should be planned, implemented, and evaluated by active participation of local
communities for enhancing its quality and transparency among stakeholders.
 As indicated in the comprehensive plan of the Tendaho Sugarcane Plantation plan there is
a compensatory plan to compensate the displaced pastorals and lose access to rangelands.
These plans have never been implemented fully to address the issues raised in the
discussion part.
 Shortage of milk supply, as one of nutritional food for children, can also be a problem as
the livestock production is discouraged due to expansion of sugarcane production in the
area. Therefore improved milk cows with limited population should be considered.
 At finally yet importantly, ownership and sustainability are the two key catchwords in the
economic and social development concepts. Community participation and their active
involvement starting from the inception stage of a given project or program is bedrock of
continued developments endeavors and intervention. As the facts of this research’s
findings indicate the community participation during the project initial stage was so
minimal. A remedial actions should be designed and be in place to take a full advantage
out of this huge mega investments.
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7. Appendix
Appendix 5.A:- Questionnaire
This questionnaire is administered to assess the impact of sugarcane farmland expansion on

pastoral and agro pastoral community livelihoods in Dubti, Assyta and Det-bahre districts of
Afar region
Introduction
I, Mesfin Tassew, would like your assistance in filling this questionnaire as a partial requirement
for the fulfillment of my Master Degree of Project planning and Management in the School of
Business and Economics of Semera University with Tossa College. The responses shall be
confidential and used for the sole purpose of this thesis. Your co-operation is highly appreciated.
Section A:
A1:-Respondent Personal Data
1.1.Name
(optional)…………………………………………………………………………………..
1.2.Gender ፡- Female Male
1.3. Age …………
1.4.Location………………………….
1.5. What is your highest level of education? : -
Tertiary
1.6. What is your occupation?
1.7. What is the size of your household?
SECTION 2: Landholding and land use of the household (hh) (Table 1)
Area
Area (ha) (ha)after
before intervention Reason if landholding of the hh
Code Land use type intervention n got shrunk owing to any factor
1 Annual crops
2 Perennial crops
3 Irrigated land
4 Forest/wood lots
5 Grazing/pasture area
6 Home stead
Total
2.1. Do you get any displaced because expansion of sugar cane production on your land
1. Yes 2.No
2.1.1. If Yes, What are your incentive packages from Government in expansion of sugarcane
production on Your land?/displaced, other benefits etc /
---------------------------------- ------------------------------------- ----------------------------------- ----
------------------------------------- ------------------------------------- ---------------------------------------
----------- ------------------------------------------- ------------------------------------ ---------------------
2.1.2 What are the criteria for displaced? ------------------------------ --------------------------------
-------------------------------------- -------------------------------- ---------------------------------- -------
-------------------------------------------------------------------------------------------------------------
---------------------------- -----------------------------------------------------
2.1.3. Amount of displaced in birr per hectare and per Month/year-------------

2.1.4. Displaced is paid for -------- years, why? -----------
2.1.5 What is your level of participation in expansion of sugarcane production on your land? A.
Excellent B. very good C. Good D. satisfactory E. weak
2.1.6. If Excellent or weak, why? -------------------------------- -------------------------------- ----------
---------------------------- --------------------------- --------------------------------------------
2.1.7. What is your opinion in expansion of sugarcane production on farmers land?
Strength: -------------------------------- ------------------------------- ------------------------ -------------
-----------
Weakness: /displacement, displaced etc/------------------------ ------------------------------- -
2.2 Source of income for Household
2.2.1 Livestock production
2.2.1.1 Are you engaged in livestock production? 1) Yes 2) No
2.2.1.2 If yes to the above question, please tell us the following (use table 2):
Table 2: Livestock holding now, sales and income before and after intervention years
Number sold in Income earned from

Livestock/beehive birr during sales now (birr) after
Code Livestock type number available, now intervention intervention
1 Camel
2 Oxen/adult bull
3 Cow
4 Heifer
5 Yung bull
6 Calf
7 Sheep, adult
8 Sheep, kids
9 Goats, adult
10 Goats, kids
11 Chicken
12 Donkey
13 Horse
14 Beehive
2.2.1.3. If “no” to the above question, why?
a. I have never been engaged in livestock production.
b. I destocked my livestock asset for the interests of a business which is more worth than keeping
livestock.
C. Since no adequate pasture area owing to expansion of state projects which forced me to
destock?
D. others
2.2.1.4. Livestock production during the last 5 years and household income earned from sales of
livestock by-products the last 5 years (Table 3). And now
Table 3: Product type, No. of animals involved, unit of product, quantity produced, price
No. of
Livestock by- animals Average price per
Sr. No products involved Unit qty (birr/unit)
before after before after
1 Camel milk Litre.
2 Cow milk Litre.
3 Goat milk Litre
Butter
4 produced Kg.
5 Egg produced Number
Hides and
6 skin Numbe
2.2.2 Crop production

2.2.2.1 Did your household produce crop the previous production year? 1) Yes 2) No
2.2.2.2 If yes to the above question, tell us the following: (use Table 4)
Table 4: Crop production, income before and after intervention:
Amount
Income from
Production (qt) Amount sold (qt) consume
Type of crop Area sales (Birr)
d (qt)
Code produced (hectare)
bef afte
before after before after before after
ore r
Staple crops
1 Maize
2 Sorghum/
3 Finger millet/
4 Teff
5 Oil crops
6 Sesame
Niger
7
seed/Noug/
8 Groundnuts
9 Flax (Telba)
10 Saflower (suf)
11 Pulse
12 Haricot bean
13 Horse bean
14 Pea
15 Vegetables
16 Carrot
17 Beet roots
18 Cabbage-local
19 Cabbage-exotic
20 Onion
21 Tomato
*If there production is more than the sum of what is sold, consumed, damaged or stored, give the
quantity and associated remark.
1.2.5. If “no” to the above question, tell us the reasons:
a.
b.
c.
2.2.2.4 Do you own fruit trees? 1) Yes 2) No
2.2.2.5. If yes to the above question, please tell us the following (Table 5):
Table 5: Production and income from perennial crops during the last five years and now
No. of
Type of trees/
crop bushes Income from
Code produced owned Production (qt) Amount sold (qt) sales (Birr)
before after before after before now
1 Mango
2 Banana
3 Papaya
2.4.1. If a family member was to obtain employment in the plantations, how do you think Sugar
cane plantations and factory would benefit your household? Choose one that most applies to your
Household.
Income
Education for children
Food security
Would not benefit our household
Other _________________________
3. Previous and current Household assets
3.1. Inventory of household assets and estimate value (Table 6)
Unit price or
Quantity owned value (Birr/unit)
Code Component Unit Previous Current Previous Current
Physical capital
1 Own animal cart Number
2 Own Television Number
3 Own Radio Number
4 Own private water well Number
5 Own water pump Number
6 Own mobile phone Number
7 Hand watch Number
8 Specify other asset if any
Financial capital
9 Own saving, now Birr
10 Social capital
Membership in
11 associations Number
4. Sources of Credit
4.1.1. D
4.1.2. If you’re answer for the above Yes what is the source of credit?
Banks Cooperatives if another ---------------------------------
5. How far you travel to sell or buy to market?
Long
Medium
Short
6. Do you get any advice from agricultural extension?
Yes No
6.1. If your answer is yes, then in which activities?
on livestock and poultry
production other……..
6.2. If your answer is No, Why?
Regression of relationship between Expansion of sugarcane plantation and independent
(average annual income of household)
Note: accecredhh omitted because of collinearity
Iteration 0: log likelihood = -1098.0009
Ordered logistic regression
Number of obs = 369
LR chi2 (14) = 848.70
Prob > chi2 = 0.0000
Log likelihood = -673.64923 Pseudo R2 = 0.3865
------------------------------------------------------------------------------
Average annual
Income | Coef. Std. Err. z P>|z| [95% Conf. Interval]
-------------+----------------------------------------------------------------
Treatment | .3310913 .2087905 1.59 0.113 -.0781305 .7403131
agehh | .0222079 .0136124 1.63 0.103 -.0044719 .0488877
sexhh | -.9283548 .2967593 -3.13 0.002 -1.509992 -.3467173
hhsize | .6919202 .0650061 10.64 0.000 .5645105 .8193299
arhbei | .3414271 .1205977 2.83 0.005 .10506 .5777942
arhafi | -.1487495 .2414509 -0.62 0.538 -.6219846 .3244856
avinchhbei | .0000378 2.66e-06 14.24 0.000 .0000326 .0000431
asshhbei | -.000061 .0000143 -4.28 0.000 -.000089 -.0000331
asshhafi | .0000308 .000011 2.80 0.005 9.28e-06 .0000524
distnmkt | .175949 .1412581 1.25 0.213 -.1009117 .4528097
agriex | -.9407777 .3015159 -3.12 0.002 -1.531738 -.3498175
marstshh | -.7303668 .3776569 -1.93 0.053 -1.470561 .0098271
accecredhh | 0 (omitted)
educhh | .2497344 .1348858 1.85 0.064 -.0146369 .5141057
benefitofhh | -.0930583 .1108741 -0.84 0.401 -.3103675 .124251
-------------+----------------------------------------------------------------
Checking Multicolinerity
. vif
Variable | VIF 1/VIF
-------------+----------------------
Arhbei | 35.20 0.028
arhafi | 33.12 0.030
avinchhbei | 9.01 0.111
asshhafi | 5.68 0.176
asshhbei | 5.35 0.187
hhsize | 2.49 0.402
agriex | 2.05 0.487
agehh | 1.93 0.517
educhh | 1.74 0.574
marstshh | 1.24 0.804
distnmkt | 1.12 0.894
sexhh | 1.08 0.929
benefitofhh | 1.07 0.931
-------------+----------------------
Mean VIF | 7.97
1. Matching Analysis
. Psmatch2 Treatment agehh sexhh hhsize arhbei arhafi avinchhbei asshhbei asshhafi distnmkt
> agriex marstshh accecredhh educhh benefitofhh,outcome( avinchhafi)logit
Note: accecredhh omitted because of collinearity
Logistic regression Number of obs = 369
LR chi2 (13) = 49.46
Prob > chi2 = 0.0000
------------------------------------------------------------------------------
Treatment| Coef. Std. Err. z P>|z| [95% Conf. Interval]
-------------+----------------------------------------------------------------
agehh | -.0002812 .0161172 -0.02 0.986 -.0318703 .0313079
sexhh | .2993433 .3302631 0.91 0.365 -.3479605 .946647
hhsize | .1004244 .0604705 1.66 0.097 -.0180956 .2189444
arhbei | -.3987507 .1407458 -2.83 0.005 -.6746073 -.1228941
arhafi | .7144611 .2736335 2.61 0.009 .1781494 1.250773
avinchhbei | -4.37e-07 1.01e-06 -0.44 0.664 -2.41e-06 1.53e-06
asshhbei | 1.48e-06 .0000166 0.09 0.929 -.000031 .000034
asshhafi | -.0000192 .0000129 -1.49 0.136 -.0000445 6.05e-06
distnmkt | -.288177 .1588446 -1.81 0.070 -.5995068 .0231527
agriex | .7727342 .3318996 2.33 0.020 .122223 1.423245
marstshh | -.1797743 .3913465 -0.46 0.646 -.9467993 .5872507
educhh | -.1412918 .1460294 -0.97 0.333 -.4275042 .1449206
benefitofhh | .0685018 .1307295 0.52 0.600 -.1877234 .3247269
_cons | 1.074248 1.151307 0.93 0.351 -1.182272 3.330767
------------------------------------------------------------------------------
There are observations with identical propensity score values.
The sort order of the data could affect your results.
Make sure that the sort order is random before calling psmatch2.
----------------------------------------------------------------------------------------
Variable Sample | Treated Controls Difference S.E. T-stat
----------------------------+----------------------------------------------------------
avinchhafi Unmatched | 239517.094 219091.425 20425.6695 27671.6564 0.74
ATT | 239517.094 254012.663 -14495.5688 40176.6149 -0.36
----------------------------+-----------------------------------------------------------
Note: S.E. does not take into account that the propensity score is estimated.
| psmatch2:
psmatch2: | Common
Treatment | support
Assignment | on support | Total
-----------+-----------+----------
Untreated | 148 | 148
Treated | 221 | 221
-----------+-----------+----------
Total | 369 | 369
2. Checking for Balance
. pstest agehh sexhh hhsize educhh marstshh arhbei arhafi avinchhbei asshhbei asshhafi distn
> mkt agriex accecredhh benefitofhh
------------------------------------------------------------------------------
| Mean | t-test | V (T)/
Variable | Treated Control %bias | t p>|t| | V(C)
------------------------+--------------------------+---------------+----------
agehh | 38.143 38.291 -1.6 | -0.18 0.857 | 1.21
sexhh | 1.1609 1.1609 0.0 | 0.00 1.000 | 1.00
hhsize | 5.1739 5.3174 -5.3 | -0.56 0.576 | 1.10
educhh | .81739 .70435 11.6 | 1.32 0.186 | 1.14
marstshh | 1.987 1.9957 -2.7 | -0.35 0.724 | 1.13
arhbei | 7.063 7.363 -6.4 | -0.71 0.479 | 0.83
arhafi | 3.0522 3.2043 -6.6 | -0.72 0.471 | 0.81
avinchhbei | 1.4e+05 1.4e+05 -4.5 | -0.49 0.621 | 0.85
asshhbei | 12498 14216 -11.7 | -1.48 0.141 | 1.16
asshhafi | 19140 21073 -10.0 | -1.29 0.198 | 1.11
distnmkt | 1.5913 1.4957 12.9 | 1.53 0.126 | 1.15
agriex | .79565 .77826 3.8 | 0.45 0.650 | .
accecredhh | 0 0 .| .| .
benefitofhh | 1.5739 1.6174 -4.9 | -0.51 0.611 | 0.96
------------------------------------------------------------------------------
* if variance ratio outside [0.77; 1.30]
----------------------------------------------------------------------
Ps R2 LR chi2 p>chi2 MeanBias MedBias B R %Var
----------------------------------------------------------------------
0.014 9.23 0.756 6.3 5.3 28.4* 1.51 0
----------------------------------------------------------------------
* if B>25%, R outside [0.5; 2]
3. Checking Common Support
. . Tab _weight if Treatment==1
psmatch2: |
Weight of |
Matched |
Controls | Freq. Percent Cum.
------------+-----------------------------------
1| 221 100.00 100.00
------------+-----------------------------------
Total | 221 100.00
. Tab _weight if Treatment==0
psmatch2: |
Weight of |
Matched |
Controls | Freq. Percent Cum.
------------+-----------------------------------
1| 68 62.39 62.39
2| 16 14.68 77.06
3| 9 8.26 85.32
4| 5 4.59 89.91
5| 2 1.83 91.74
6| 3 2.75 94.50
7| 2 1.83 96.33
8| 2 1.83 98.17
12 | 1 0.92 99.08
13 | 1 0.92 100.00
------------+-----------------------------------
Total | 109 100.00
4. Propensity Score Matching Technique
4.1. Propensity Score Equation: Satisfying the Balancing Property
Pscore Treatment agehh sexhh hhsize arhbei arhafi avinchhbei asshhbei asshhafi distnmkt ag
> riex marstshh accecredhh educhh benefitofhh,pscore(Aps)comsup
****************************************************
Algorithm to estimate the propensity score
****************************************************
The treatment is Treatment
Treatment | Freq. Percent Cum.
----------------+-----------------------------------
Not participate | 148 40.10 40.10
Participate | 221 59.90 100.00
----------------+-----------------------------------
Total | 369 100.00
Estimation of the propensity score
Note: accecredhh dropped because of collinearity
Probit regression Number of obs = 369
LR chi2(13) = 49.41
Prob > chi2 = 0.0000
------------------------------------------------------------------------------
Treatment | Coef. Std. Err. z P>|z| [95% Conf. Interval]
-------------+----------------------------------------------------------------
agehh | .0000375 .0098819 0.00 0.997 -.0193306 .0194056
sexhh | .1898928 .2001606 0.95 0.343 -.2024147 .5822003
hhsize | .0599195 .0366625 1.63 0.102 -.0119376 .1317765
arhbei | -.2365418 .0829718 -2.85 0.004 -.3991635 -.0739201
arhafi | .4264245 .1626951 2.62 0.009 .107548 .745301
avinchhbei | -3.03e-07 6.13e-07 -0.49 0.621 -1.50e-06 8.99e-07
asshhbei | 4.46e-07 .0000101 0.04 0.965 -.0000194 .0000203
asshhafi | -.0000114 7.85e-06 -1.45 0.146 -.0000268 3.98e-06
distnmkt | -.1767984 .0965254 -1.83 0.067 -.3659847 .012388
agriex | .4744696 .2038747 2.33 0.020 .0748827 .8740566
marstshh | -.1178855 .2402659 -0.49 0.624 -.5887981 .3530271
educhh | -.0829278 .089053 -0.93 0.352 -.2574685 .091613
benefitofhh | .0374757 .0782443 0.48 0.632 -.1158804 .1908317
_cons | .6524485 .703642 0.93 0.354 -.7266645 2.031562
------------------------------------------------------------------------------
Note: the common support option has been selected
The region of common support is [.13259384, .91143544]
Description of the estimated propensity score in region of common support
Estimated propensity score
-------------------------------------------------------------
Percentiles Smallest
1% .2201204 .1325938
5% .2800866 .1325938
10% .3716229 .1325938 Obs 369
25% .470214 .2201204 Sum of Wgt. 369
50% .6251606 Mean .5997123
Largest Std. Dev. .1720955
75% .7373711 .8890327
90% .8109492 .9114354 Variance .0296169
95% .8284872 .9114354 Skewness -.4212283
99% .8890327 .9114354 Kurtosis 2.365664
******************************************************
Step 1: Identification of the optimal number of blocks
Use option detail if you want more detailed output
******************************************************
The final number of blocks is 6
This number of blocks ensures that the mean propensity score is not different for treated and
controls in each blocks
**********************************************************
Step 2: Test of balancing property of the propensity score
Use option detail if you want more detailed output
**********************************************************
The balancing property is satisfied
This table shows the inferior bound, the number of treated
and the number of controls for each block
Inferior |
of block | Treatment
Of pscore | not parti participate | Total
-----------+----------------------+----------
.1325938 | 2 1| 3
.2 | 36 18 | 54
.4 | 55 49 | 104
.6 | 30 49 | 79
.7 | 15 62 | 77
.8 | 10 42 | 52
-----------+----------------------+----------
Total | 148 221 | 369
Note: the common support option has been selected
*******************************************
End of the algorithm to estimate the pscore
*******************************************
4.2. The following sections estimate the treatment effect of Expansion of Sugarcane
plantation participation, using different matching techniques that are available.
Average Treatment effect using Nearest Neighbor Matching
. attnd avinchhafi Treatment,pscore(Aps)comsup
The program is searching the nearest neighbor of each treated unit.
This operation may take a while.
ATT estimation with Nearest Neighbor Matching method
(Random draw version)
Analytical standard errors
---------------------------------------------------------
N. treats. n. contr. ATT Std. Err. t
---------------------------------------------------------
221 134 15350.171 38976.399 0.394
---------------------------------------------------------
Note: the numbers of treated and controls refer to actual
Nearest neighbor matches
Average Treatment Effect using Radius Matching
. attr avinchhafi Treatment,pscore(Aps)radius(0.05)comsup
The program is searching for matches of treated units within radius.
ATT estimation with the Radius Matching method
Analytical standard errors
---------------------------------------------------------
n. treat. n. contr. ATT Std. Err. t
---------------------------------------------------------
221 148 -9498.421 30062.226 -0.316
---------------------------------------------------------
Note: the numbers of treated and controls refer to actual matches within radius
Average Treatment effect using Kernel Matching
. attk avinchhafi Treatment,pscore(Aps)comsup
The program is searching for matches of each treated unit.
ATT estimation with the Kernel Matching method
---------------------------------------------------------
n. treat. n. contr. ATT Std. Err. t
---------------------------------------------------------
221 148 -985.346 . .
---------------------------------------------------------
Note: Analytical standard errors cannot be computed. Use the bootstrap option to get
bootstrapped standard errors.

Final RESEARCH THESIS MT2

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Final RESEARCH THESIS MT2

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IMPACT OF TENDAHO SUGAR CANE PLANTATION PROJECT ON

THE PASTORAL LIVELIHOOD AT AFAR REGIONAL STATE, CASE

ADVISOR: DR. HASSEN BESHIR

IMPACT OF TENDAHO SUGAR CANE PLANTATION PROJECT ON THE

Approved by Board of Examiners

1. HASSEN BESHIR (DR) _ ___________________ _______________

Advisor Signature Date

2. ______________________ __________________ _______________

External Examiner Signature Date

3. ______________________ __________________ ________________

Internal Examiner Signature Date

4. _______________________ __________________ ________________

Chair Person Signature Date

Name of student: Mesfin Tasew

Fig 3.1 Conceptual Framework -------------------------------------------------------------------------15

Fig 4.4 Common Support of Treated and Untreated -------------------------------------------------43

Fig4.5 Histograph of common support of Treated and control-------------------------------------44

ACZ Agricultural Climate Zone

ARNS Afar Regional National State

BOA Bureau of Agricultural

CSA Central Statistics Agency

ETP Employments –To-Population Ratio

EPA Environmental Protection Authority

FAO Food and Agriculture Organization

FGD Focus Group Discussion

GDP Gross Domestic Production

GIS Geographical Information System

GTP Growth Transformation Project

MDG Millennium Development Goals

MOA Ministry Of Agriculture

TSF Tendaho Sugar Factory

Keywords: Tendaho Sugarcane Plantation, Pastoralist, Socioeconomic impact, Livelihood

1.1. Background of the study

1.3.1. Specific Objectives.

1. To describe the socio-economic, demographic and institutional characteristics of the

1.4. Research Questions

1. Which the socio-economic, demographic and institutional characteristics of the households

1.5. Significance of the study

1.6. Scope of the study

1.7. Organization of the Study

Definition and Concept

2.1 .1.Global Trends in Sugarcane Farming

2.1.2. Plantation Sugarcane Farming and Community Livelihoods

2.2.1. The impact expansion of Sugarcane Production in Different Countries

Farmers benefit Millers benefit

Community livelihood  Pastureland

Figure 1.1: Conceptual framework (derived from literature research

3. Methodology of the study

3.1. Research Design

3.2. Study Area

3.3. Target Population and Sampling Procedures

Hence, n = 1.962*(0.6)* (1-0.6) = 369 respondents

3.4. Data Collection Methods

3.5.1. Model Specification and estimation method

3.5.1.1 Theoretical definition

Αit = YTit - YCit ------------------------------------------- (3).

3.5.2. Estimation Method

Logit(Y) = þo + þ1x1 + þ2x2+… þixi+µ

This can be expressed formally by:

0 < P (D = 1|X) < 1

Different matching criteria can be used to assign participants to non-participants on the

C (Pi) = min | Pi -Pj |

Pi: is the estimated propensity score for the treated subjects i

1. HASSEN BESHIR (DR) _ _____ _

2. ______ _

3. ____

4. _____

Hence, n = 1.962(0.6) (1-0.6) = 369 respondents