In Ethiopia, over 15,000 small and 3,000 medium scale enterprises are operating in various sectors. This would have greater contribution to meet the 2025 target of attaining middleincome status set by the country. The Small and Medium Scale Development Industries Agency has been working a lot in order to achieve the target set. In his stay with the Ethiopian Press Agency, Asfaw Ababa Agency Director General raised numerous points regarding the government’s efforts to strengthen small and medium scale industries. For years, Ethiopia has been making various activities in the agriculture sector.
Huge tasks have also been done in small and medium enterprises so as to encourage numerous enterprises. No matter how much focus was given to sectors, the achievement registered so far was below expectatinons Thus, sustainable development can be achieved if and only if the country works more on expanding manufacturing industries and achieve truck records. As the manufacturing industry is capable of uplifting other sectors, through supplying various inputs and mobilizing big amount of wealth, it is imperative to make beneficial those engaged in the sector.
The agriculture sector, for instance, will grow if the manufacturing sector is growing steadily. In previous days, processing wheat to floor and producing bread and cake was inconceivable in rural parts of Ethiopia. But, these days, distribution mechanisms are identified in order to dispense wheat flour machine to all woredas. In this case, farmers would be encouraged to produce more. Because the supply of wheat meets the market demand and would increase their return In recent years, due to the absence of such a system, the shortage of agricultural products has been observed and now no product was perished due to the absence of market linkage. As per the first Growth and Transformation Plan performance report, the manufacturing sector has registered 4.8 percent growth.
This means the contribution of the sector to the economy does not exceed five percent. Now, it stakeholders have been working hard to uplift the progress to 8 percent by the end of 2020. However, much remains to be done in order to develop small scale farmers in all woredas.
The small manufacturing industries can start up their works from farmers’ arable land. For instance, instead of transporting produces from rural to urban areas and expose them to spoilage and encountered with ups and downs, there is a possibility of processing, packing and supplying products in the production areas and then supply them to the market.
In Ethiopia, there are enabling conditions – including huge labor force working with little skill and knowledge, wide market opportunity, the existence of untapped resource potentials in agriculture and mining sectors [if values added on them, they can substitute imported goods] – to meet the target set in the manufacturing sector and gain the planned outcome.. Such opportunities are indicators of development in the sector. If the sector is able to integrate all the inputs, it will contribute greatly to achieve the target set. In addition, creating consistent attitudes and integration in order to utilize the fortune is a must.
For this, joint awareness raising programs and integration should have to be intensified. If we are keeping the momentum and if all give prior attention to local products, there is a possibility to hit the target set by 2025 and even go beyond. Heavy industries are a place where small and medium scale enterprises acquire knowledge and expertise.
Today’s youth who join heavy industries are initially expected to be the owner of small and medium enterprises. Bearing in mind all this, the youth have to be employed in industries. The experience along the past years shows, in one or another way, most of the owner of small and medium enterprises were hired in few but giant industries. In their stay, they have acquired skills, knowledge and recognized the way of creating market linkage. Through the process, they become self-reliant via opening their own enterprises.
Considering that giant industries are a center for knowledge and expertise, if we are utilizing them effectively, the sector will lay on a sustainable base. It will also help expand small industries to rural parts of Ethiopia where there is abundant resource. Maintaining peace is another task in realizing the target. Whatever the measurement is, Ethiopia is a country conducive for the manufacturing sector.
The skilled manpower, the abundant resources, the efforts already started among others is factors that could contribute greatly to hit the target by the stated period. However, the political unrest occurs in some parts of the country may appear to be the hindrance for the expansion of industries. As they are working by importing advanced technologies and borrowing money from various financial sources, the existence of peace is critical for them to sustain as economic institutions contribute greatly to the growing economy. Such industries demand less capital and knowledge.
Though much remains to be done in giving focus at woreda level, if we are able to work on them and modernize the agriculture sector, it is possible to achieve the target set through linking agro-processing industries with the giant firms. As learned from the best practice of foreign countries, all are given their attention to small and medium industries in order to benefit their citizens. The manufacturing sector needs unreserved support and participation of all stakeholders. The effort should be even beyond words.
For this to happen, the effort exerted should start from the individual level. And the society has to consume locally produced, clothing as well office and household furniture. Here, it is imperative to mention the development of India in this regard. What is more, the youth and citizens should give prior attention to local products. Not only here in Ethiopia, but the diaspora should also develop the culture of identifying, consuming locally made products. When this happens, the producers would be encouraged. In the process, our wealth can regenerate itself.
Herald January 10/2019
BY GIRMACHEW GASHAW
