Independent Evaluation of DFID Ethiopias Private Enterprise Programme Ethiopia (PEPE)

In 2012, DFID (now FCDO) put together the Private Enterprise Programme Ethiopia (PEPE) to respond to the second growth and transformation plan of the government of Ethiopia. Within the focus areas of this growth and transformation plan, PEPE prioritised sectors where there were clear opportunities for job-creation, particularly for women, and green growth. PEPE focuses on horticulture, apparel and textiles, and leather sectors, integrating finance-related interventions to catalyse growth and job-creation in the selected, priority sectors.

IDS worked with the consultancy firm Palladium on an impact evaluation designed to assess the importance of the contribution of PEPE to job creation and smallholder incomes. It resulted in a reasoned, plausible estimate of the range within which PEPE created jobs in the Ethiopian economy. It is difficult to precisely estimate job-creation and the economy-wide effects for market systems development (MSD) programmes for numerous reasons. Often, the types of interventions that an MSD programme implements have a restricted sphere of direct influence, often the service providers in a sector, where job creation is not located in the supported firms but indirectly through increased innovation and investment in the sector.

There are many factors that also influence innovation and investments, such as Covid-19, international trade dynamics and political unrest, which means it is not possible to directly attribute sector indicators of employment to the MSD interventions. The analysis needs to consider indirect processes of contribution by tracing the processes of change. To mitigate and respond to these challenges, the evaluation design relied on four interlinked research components:

  • A review of the monitoring information provided by PEPE’s result-based management system.
  • A review of six markets (through process-tracing case studies) in which PEPE’s interventions have reported significant outcomes and impacts.
  • An assessment of the quantitative net-effects of service uptake among firms involved in the three priority sectors, through the PEPE programme. This assessment was done using a survey of firms.
  • A model simulation (Computable General Equilibrium (CGE) modelling) to extrapolate the implications of these firm-level changes to sector effects on job creation.

In bringing these components together, this evaluation has tested a unique approach to attempt a rigorous evaluation of the impacts of a programme that intervenes to address systemic constraints in the market.

“Thank you all for the effort put into making this happen. This was indeed a very collaborative endeavour, and you have been a very responsive team. FCDO is happy for your deliverables all through this program, including the substantive end line evaluation. We appreciate your openness, flexibility and upbeat substance.”

Getachew Teklemariam | Advisor – Private Sector Development | British Embassy – Ethiopia


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Centre for Development Impact


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Ayako Ebata

Research Fellow

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Dirk Willenbockel

Research Fellow

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Giel Ton

Research Fellow

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Keir Macdonald

Research Officer

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Seife Ayele

Research Fellow