In the advent of exchange of tariff wars and curtailment of foreign emergency relief aid primarily by western powers and under the condition of trade protection policies that are looming in the world, Ethiopia has no choice other than being economically self-reliant by mobilizing her local resources.
Even before the current global economic chaos, Ethiopia launched Climate Resilient Green Economy policy and Strategy as part of national socio-economic development. Over the last six reformative years, Ethiopia has continued to set an example for Africa in her bid for self-reliance.
Since 2018, Ethiopia has embarked on a pathway that wills lead the country towards self-reliance and prosperity. The contributor of this article intends to show the major indicators and development components that would justify this. The nation has implemented over 80 policy reforms to improve its investment climate, focusing on sector liberalization, regulatory adjustments, and legal frameworks that are required to implement them.
Ethiopia is striving to be self-sufficient in food, manufacturing goods, defense industries and other items that the country has been importing from abroad.
In her reform agenda, Ethiopia has identified agriculture, manufacturing, tourism, mining, and ICT as key pillars of economic growth. Prime Minister Dr. Abiy Ahmed has emphasized that while all five pillars hold immense untapped potential, agricultural productivity remains the critical, driving force of our economy. This focus on agriculture not only supports food security but also creates jobs, stabilizes rural communities, and establishes a robust foundation for sustainable economic development (Elfnesh Muleta 2024).
Ethiopia’s agricultural transformation is a multifaceted initiative that not only expands land for crop production but also significantly boosts productivity across key sectors, including dairy, meat, poultry, fish, and honey. This holistic approach prioritizes nutrition-sensitive agricultural practices designed to enhance dietary diversity and elevate the nutritional quality of food. Programs such as “Yelemat Turufat” are pivotal in this endeavor, actively promoting the cultivation of nutrient-rich crops that contribute to better health outcomes and food security for all Ethiopians. It is to be recalled that Ethiopia is now the top wheat producing country and no more imports wheat from abroad. Self-reliance and export of rice and maze is just at the corner.
At the heart of this strategy lies the government’s commitment to climate-smart agricultural practices, which incorporate drought-tolerant crops, efficient irrigation systems, and sustainable land management techniques to build resilience against climate impacts and ensure reliable food production. As part of the Green Legacy Initiative, the government has also expanded the cultivation of perennial crops and fruits, strategically diversifying agricultural sectors vulnerable to climate change. Emphasizing on the issue, Prime Minister Abiy Ahmed stated “Through innovation, technology, and climate-smart irrigation, we have transformed our agricultural landscape from a wheat deficit to a surplus, increasing production by an impressive 300%. This shift not only liberates us from the grips of poverty but also harnesses our human potential to drive enhanced productivity. To nurture a truly productive workforce and population, we must make critical investments in nutrition…”
Ethiopia’s food security strategy prioritizes wheat production, investing in improved farming practices, drought-resistant varieties, and climate-smart irrigation to boost domestic output. This focus on agricultural productivity, within a diversified economy leveraging natural resources, favorable climate, and a youthful population, aims to foster resilience and long-term economic growth. The Green Legacy Initiative, with its focus on environmental restoration and agroforestry, further promotes sustainable agriculture with impacts extending beyond Ethiopia’s borders, as highlighted by Prime Minister Abiy Ahmed:
In Ethiopia since 20013, public investment has constituted well over one third of the nation’s GDP, far higher than the 22% for the African region for the same year. Such investments were of crucial importance for uplifting over 2.5 million Ethiopians from the global poverty line. Public investments in infrastructure, health and education vividly standout as evidence for the viability of the nation’s pro poor development polices.
The government has been exerting multi-faced efforts in involving the private sector in the promotion of the national economy. The packages of incentives that the government offered to the private sector include lifting of restrictions on equity ownership in joint venture investment with domestic investors, income tax exemption (2 to 8 years), exemption from the payment of customs duty, carry forward of losses (half of the tax holiday period), export incentive Schemes, duty Draw-Back scheme, voucher scheme, bonded manufacturing warehouse scheme and export credit guarantee scheme, guarantees against expropriation or nationalization (Constitution & Investment Law, MIGA & BITs, full repatriation of profits, dividends, principal and interest payments on external loans , the right to employ expatriate experts and management staff and several other incentives that are not common in the investment policies of other African countries. In this context, Ethiopia has already entered into bilateral investment programs with 18 countries across the world.
In order to provide technical support to investors engaged in various sectors of the national economy, the government has established a number of technical institutes including Textile Industry Development Institute, Leather Industry Development Institute, Metal Industry Development Institute, Chemical and Construction Input Industry Development Institute, Meat & Dairy Industry Development Institute , Food Beverage and Pharmaceutical Industry Development Institute, National Kaizen Institute and Industrial Zones Development Corporation to meet global quality standards in Europe.
Some of them are Bole Lemi Industrial Park phase 1 and 2, Kilinto Industrial Park, Kombolcha Textile Cluster, Dire Dawa Special Economic Zone, Eastern Industry Zone and Ethio-Turkish Industry Zone are some of the prominent industry zones which are expected to pioneer the nation’s vision for the transition from agriculture led economy to industry. Ethiopia has established Free Trade Zone in Dire Dawa to be followed by several others.
The development of the manufacturing sector showed a meaningful start up due to specific services that are provided by the government.Ethiopia has now started to produce manufactured goods at national level through Made in Ethiopia campaign and by introducing comprehensible import substitution programs on manufactured goods. In his response to questions raised by the MPs at HPR, Prime Minister Abiy Ahmed has noted that 70 new manufacturing industries will be built in the current fiscal year.
Provisions of uninterrupted electric power, water supply and in shed feeder roads have also contributed to the promotion of the sector. Besides, the government is working on skill development programs through university-industry linkage. Promotion of micro and small-scale enterprises, facilitation of financial sources for investments and several other monetary services in favor of the manufacturing sector are some of the measures taken by the government.
Ethiopia, now known as the Land of Origins has rich tourist potentials. The unique nature, culture and history merge to form a timeless appeal has made the tourism industry a promising sector for national economic development. Ethiopia comprises many high mountains and most of the longest rivers, highest plateaus and plains in Africa. It has spectacular alpine terrain including the Simien Mountain National Park (4543m above sea level) and the lowest Place on earth in the Danakil depression (121 m below sea level).
These resources vividly indicate opportunities for tourists and other visitors to experience Ethiopia’s ecology and natural beauty. Ethiopian cultural tourism attractions include historical monuments like the steles and obelisks of Axum, the rock hewn churches of Lalibela archeological sites in Afar, battlefields like the Battle of Adwa, religious buildings like Saint Mary of Zion, museums including the National Museum, festivals including Meskel, Timket, indigenous architecture, dress, artifacts and handicrafts.
With the most UNESCO World Heritage Sites than any other African country (including Egypt), Ethiopia is a hidden gem that captivates many travelers. With such cultural diversity, archaeological pedigree and natural beauty, there’s a good reason why it is a so high on the Wild Frontiers travel list.
The nation possesses a number of national parks across the country including the Omo National Park, Yangudi Rasa National Park, Netchsar National Park, Mago National Park, Abijata-Shala National Park, Chebera Churchura National Park provide highly attractive natural beauty with their wildlife resources and vegetation. Ecotourism projects sites initiated by Prime Minister Abiy Ahmed including Gorgora, Wonchi, Cheberal Churchura, Koisha and others.
All these development sectors could lead the country towards developing its manufacturing sector serving as market base. Although there is a lot to be accomplished in the coming years, it is now clear that the country is on the right path towards industrialization in general and the promotion of the manufacturing sector in particular.
BY SOLOMON DIBABA
THE ETHIOPIAN HERALD TUESDAY 25 MARCH
