A new bill proposing the establishment of a special fund, potentially worth billions of Birr, was presented to the Ethiopian parliament last week. The bill, co-authored by the Ministry of Finance and the Ethiopian Forestry Development, aims to provide sustainable domestic financing for green legacy initiatives and the restoration of degraded land.

Under the management of the Climate Resilient Green Economy Facility (CRGEF), a 13-year-old initiative under the Ministry, the fund is set to be up to one percent of the federal budget. The CRGEF was initially created to build a climate-resilient middle-income economy by 2025, following the 17th session of the United Nations Framework Convention on Climate Change (UNFCCC) Conference of the Parties.

Officials believe it will provide financial support for environmental projects.

Mikias Sime, the program coordinator, said it will demonstrate the government's commitment to climate change projects and attract international financing. He noted effective coordination was needed among stakeholders to allocate resources properly.

"The financing has been cluttered so far," Mikias told Fortune.

A digital platform, upgraded from an aid management system, will track the progress of climate projects across Ethiopia. The Fund's daily operations, including project approvals and strategic decisions, will be overseen by a steering committee chaired by a Ministry of Finance official and a deputy from the Ministry of Agriculture.

The committee will oversee the Fund's daily activities, including project approvals, strategies, and decisions regarding project termination. Projects in regional states can request funding through the Ethiopian Forestry Development(EFD), with final approval granted by the Ministry of Finance if the regions provide a matching fund.

Nearly half of Ethiopia's 110 million hectares of land have become degraded, with 11 million hectares in critical condition, illustrating the dire need for land restoration.

Fanosie Mekonen, head of Natural Resource Development Protection & Utilisation at the Ministry of Agriculture, refers to an additional four million hectares of land impacted by acidity, primarily in Oromia, Southern and Amhara regional states, as a further burden. He said major financial resources will be needed to restore lands, which are also affected by excess salt in Afar, Somali, and BeniShangul Gumuz regional states.

"Massive resources are needed for us to pull through," Fanoise told Fortune.

He hopes that 22 million hectares will be restored by 2030 through a combination of technical initiatives, including lime, gypsum, and water management projects.

Gabi Rasu Zone in Afar exemplifies the disproportionate impact of soil degradation in Ethiopia's lowlands. A quarter of the 80,000hct of land has degraded, exacerbated by the lack of agro-technology tools. Abdu Ali, the head of the zone, points to the overapplication of fertiliser, cultivation and salty water resources as peculiar sources of pain.

"There is a serious problem," he told Fortune.

Abdu said commercial horticulture farms have faced difficulties due to the incremental temperature reaching 47 degrees Celsius, leaving banana and papaya produce scorched by the searing weather. He said continued financial support from development organisations is needed to help adjust to deteriorating climatic conditions.

"Investors are challenged by unpredictable humidity and poor weather," Abdu says.

Commercial agriculture farms have faced significant challenges nationwide, with a mere 41pc of the 2.1 million hectares allotted to them being developed due to weather, poor infrastructure, and a lack of finance.

The latest Country Climate & Development Report (CCDR) on Ethiopia by the World Bank points to the need for a mix of private and public investment to develop climate-resilient infrastructure and prevent worsening levels of food insecurity. The Ministry of Planning & Development has created a specialised directorate to navigate the complications arising from the impacts of a changing global climate.

Michael Hordofa, a senior coordinator at the Climate Change Directorate, said carbon emissions from other countries have pushed the composition in the atmosphere to 500tns in Ethiopia this year. A mere 0.04pc of the emission comes from local sources. The official said overgrazing and deforestation contribute the most to the high carbon content while transport accounts for around 11pc.