Enhancing Export through Industrial Parks

By Staff Writer /ABN/

It is known that Ethiopia has set goals to transform the agriculture-led economy into an industry-led economy. Accordingly, the government has been developing a number of industrial parks designated for Textile &Apparel, Footwear & Leather products, Pharmaceuticals, Machinery & Construction materials, Agro-processing as well as for multiple sectors focused on export.

As the industrial parks are playing a significant role on the national economy in various ways, Ethiopia has in recent years focused on building industrial parks as a viable strategy to increase foreign exchange earnings; and the country is striving to complete a total of 30 industrial parks over the coming years.

At present time, a good number of industrial parks have become operational while the construction of other industrial parks is going well in different parts of the country. The country’s favorable climatic condition makes the nation to be in a unique position to grow diversified agricultural products, which, in turn, could serve as an input and impetus to the industrial parks.

It is obvious that generating significant amount of hard currency, creating ample job opportunities to the youth, enhancing technology exchange, among others, are the major priorities of the government while expanding industrial parks throughout the country. If the industrial parks that commence operation in recent time created this much job opportunities, it would be possible to predict huge amount of open employment opportunities when all the industrial parks become operational in full swing.

Currently, the country has also laid cornerstone for further industrial parks construction beyond the ones that are currently operational. And it is believed that youths across the country will access job opportunities at their doorsteps.

In terms of foreign direct investment, the country has managed to attract 2.5 billion USD in FDI in the stated period and in this regard the industrial parks have been playing important role in enhancing the FDI flow. Apart from the private industrial parks, at present time Bole Lemi, Hawassa, Kombolcha, Mekele and Adama industrial parks which were developed by the government have already become operational.

On the other hand, the industrial parks have also become successful in terms of strengthening the country’s endeavors of generating more foreign exchange earnings. For instance, the nation secured more than 100 million USD from the export of various products from operational industrial parks in the past nine months in this Ethiopian budget year. The export performance in the stated period exceeded that of same period last fiscal year by 40 percent. Textiles and apparel, footwear and other leather products have been mainly exported from the industrial parks to European countries, USA, Asia and other export destination countries. Thus, this clearly manifests that how much the industrial parks could solve foreign exchange earning shortage in the future when they start to operate with full potential.

As the main purpose of investment is creating jobs, these operational industrial parks have managed to generate employment opportunities for more than 70,000 compatriots, so far.

With a view to making the investment more effective, the government is rendering effective industrial park services, fulfilling infrastructural requirements, promoting competitive human power, facilitating shade distribution and access, among others, are the major activities which have been undertaken in recent years.

The abundant resources that can be utilized for industrial inputs are vital elements to the industrialization aspirations that could catapult Ethiopia to middle income economy.

Apart from accomplishing such mega industrial parks constructions, it requires the country to promote agricultural commercialization. The vast arable land and competent human power have assisted the government’s feasible policies and strategies that aims smooth and successful journey towards industrialization. In fact, it is extremely important to combine these resources to expedite the country’s all-round development.

As it is known, the second Growth and Transformation Plan of Ethiopia, and its industrial development strategy are agricultural based, manufacturing sector-driven and export-led development.

The GTP pursued growth through export-driven industrialization strategy that focuses on capital and labor intensive manufacturing industries, export-oriented and import substituting industries. And taking this fact into consideration, industrial parks not only can play a huge constructive role in the aforementioned aspirations, they can also contribute to rapid technology and know-how transfer, and have broad linkages with the rest of the economy, and use agricultural products as an input.

With a view to enhancing the export volume of the country, the government of Ethiopia has given due attention to the textile & garment, leather &leather products, food & beverage, pharmaceutical, chemicals and chemical products, plastic &paper industries, metal and metal engineering and other industries. 

Generally speaking, in addition to playing a crucial role in generating significant amount of hard currency and creating ample jobs to citizens, industrial parks can also support the agro-processing sector by strengthening and sustaining the bond between the agriculture and industrial sector, which is pivotal to the country’s structural transformation aspirations.

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