As Ethiopia keeps undertaking multifaceted socioeconomic and political reforms, the efforts appear to have set the country on effective courses of progress over the past couple of years. One of the areas that the nation considered as part of its priority agenda is transforming the investment sector in a way that will play crucial role on its industrial transformation.
There have been significant achievements in building several state-of-the-art industrial parks in different potential areas throughout the Country. Revised investment policies and strategies, with interesting incentives for both local and Foreign Direct Investors, are also provided as part of the transformation agenda.
Meanwhile, despite policy improvements and encouraging commitments from the government, some local investors say the issues of infrastructure, peace and security as well as financial procedures are still affecting investment and the Nation’s stride towards industrialization.
Abdulahi Ali, Owner and CEO of the Akao Food Complex PLC, says he and other entrepreneurs have been engaged in the industrial sector for the last six years. According to him, the government has provided investment land. And constructions are afoot. On the other hand, reliable and encouraging investment policies are under implementation. However, the investment is facing challenges because of infrastructural insufficiency, says Abdulahi adding that one of the major issues is shortage of electricity.
“So many of our citizens do not have enough access for jobs. That is a critical problem. Thus, one of the major objectives the government pays due attention to is the fact that expanding the industrial sector is tantamount to creating plenty more jobs for citizens. In order to realize that governmental sectors with the right mandates must show strong commitment towards maintaining the industrial transformation. This means the political and economic agendas need to be carried out jointly or in a not discordant manner.
He also argues that when the main focus is placed on politics, the economic agendas could be affected. “Most of the local investors have interest in joining the industrial parks.
Under our employers’ association, nearly eight hundred entrepreneurs with industrial investment licenses are waiting to enter the industrial sector. The government has identified these entrepreneurs and promised to provide them with land or shades. However the progress has been sluggish over the past four years now,”
Abdulahi, says these entrepreneurs have the potential to transform the industrial sector, create huge number of jobs as well as to play crucial role in import substitution if the constraints are removed.
On the other hand, since several foreign direct investors are coming to the country, the government needs to consider the possibility that the local and foreign companies would work together with partnership. This would play a significant role in technological transformation and strengthening management capacity, according to him.
“There is not much problem on policies, proclamations and regulations so far. But still sufficient infrastructural access should be taken seriously.”
Feteh Woldesembet, Vice president of the Ethiopian Employer Confederation says for his part that there has been a conference where investors who are engaged in the hotel and industry sectors presented their requests concerning investment for the Deputy Prime Minister, Minsters and State Presidents.
“Now we are traveling around and receiving the answers for our requests. For instance, we used to give away thirty percent USD from the loans that we get from foreign NGOs. We have convinced the government that it is inappropriate to lose foreign currency, which the Nation needs
And the directive related to that case was changed immediately. We are getting quick response from the government to some extent and local investors would gain much better attention when they come together under the Confederation,” said Feteh.
He also noted that there are different issues concerning infrastructure, peace and security that the government has to address. It must also enhance investment opportunities that would encourage entrance and reduce the concern of exit strategies for both local and foreign direct investors.
Engineer Getahun Hussien President of the Confederation on the other hand says local investors, who are engaged both on the service and industrial sectors, have to work together instead of going on separate ways and trying to use short cuts or corrupt ways to approach troubleshooters for their problems.
He also stresses that peace and security are the most significant issues of concern for investors and that could not be achieved only by the government’s efforts but also with the investors’ collaborative contribution. Commitment in discharging their social responsibilities is much needed.
The Ethiopia Herald February 23/2020
BY HENOK TIBEBU
