Not only the amount of rainfall but also the temporal distribution matters for agricultural production (Demeke, 2004, Bewket, 2009). For instance, evidence indicates that a 10% decrease in seasonal rainfall from its long-term average leads to a 4.4% decline food production (von Braun, 1991). Studies (e.g. GebreEgziabher et al, 2011, Bewket, 2009, World Bank, 2008, von Braun, 1991) conclude that the frequency and intensity of drought is likely to increase over the coming decades, which will present a serious threat to biodiversity, ecosystems, water, agricultural and human health. Due to the strategic importance of agriculture to the national economy, and its sensitivity to water availability, this sector has been given priority by the government. There is much to consider: poor people’s dependence on agriculture and their related skills, society’s dependence on farmers managing land well in order to conserve watersheds and biodiversity, the threats of climate change including increased risk of drought and more extreme weather, the unique attributes of Ethiopia’s agricultural products and its potential for green hydroelectric power, and the powerful market drivers associated with rapid urbanisation. These problems and opportunities are linked and demand systematic attention.