According to the Growth and Transformation Plan II (GTP -II), the government gives due emphasis to sectors which expedite industrial development. As a result, during the past five years, the contribution of the industry sector GDP (value added) has witnessed an annual average growth rate of 20 percent which shows that the target set for the sector was almost achieved.
Within the industry sector, while large and medium scale manufacturing industries registered average growth rate of 19.2 percent per annum, micro and small industries registered an average growth rate of 4.1percent. At the end of the plan period, the share of the industry sector in overall GDP has reached 15.1 percent (manufacturing 4.8, construction 8.5, electric and water 1.0 and mining 0.8 percent, as the GTP document indicated.
The growth performance of the manufacturing industry in particular, which is a key indicator of the degree of structural transformation in the economy, is showing a promising progress. In nation’s development plans, greater emphasis has been given to micro and small enterprises’ development.
Even if the significant role of micro and small enterprises for job creation, entrepreneurship expansion and industrial development has been clearly indicated, the sector was not fully from drawbacks. Rather, it was challenged by hindrances such as rent seeking, low level of entrepreneurial competency, low technology and skill capability, as well as finance and market related problems.
By identifying the bottlenecks, strategies were designed to strengthen micro and small enterprises development, as this same document stated. Notwithstanding these challenges, enterprises have been expanding and jobs have been created across the country. In areas where there was encouraging performance, entrepreneurship, and small-scale trading and investment activities have expanded, leading to revitalizing of local economies and reduction of unemployment.
However, the implementation of the micro and small scale enterprises development strategies has to be consolidated in order to unleash the potential of the sector in revitalizing local economic development, nurturing entrepreneurship and addressing unemployment and poverty over the coming planning periods. Hence, new enterprises should be encouraged to engage mainly in manufacturing industry.
Furthermore, it requires to fully implement the strategic directions set out in order to improve entrepreneurship attitude, productivity and competitiveness of these enterprises. By addressing the aforementioned issues, small scale manufacturing enterprises in particular could play their roles as drivers for industrial development and source of quality and sustainable jobs.
Recently, the Federal Cooperatives Agency announced that the 6th national Cooperative Unions’ Exhibition, Bazaar and Symposium will be held in Addis Ababa from February 08-13, 2019 at the Addis Ababa Exhibition Center. On the event cooperatives unions drawn from different corners of the nation will seize the opportunity to promote their market and strengthen ties with new customers. Cooperatives in Ethiopia have more than half a century experience, building sustainable and resilient societies. It is believed that they are an important and efficient instrument to fight poverty, said Usman Surur, Director General of the Federal Cooperative Agency.
“Our cooperatives should be commended for their exemplary contributions in nation-building and community development because they are drivers of growth in their respective communities.” added the Director General. Today, over 20 million individual members have been engaging in different types of cooperatives, accounting 75 percent of the population, and are directly enlisted in every stratum of cooperatives across the country. Currently, in Ethiopia there are 85,496 primary cooperatives, 388 cooperative unions, and three cooperatives’ federations with nearly 20 million members with a total capital of 22 billion birr.
The cooperative sector has created employment opportunities for more than 1.5 people on permanent and temporary basis. As to him, marketing is one of the major challenges of cooperatives. Thus, such kind of exhibition and symposium will bring new insights towards curbing the sector bottlenecks. It will also create opportunities to diversify market opportunities for cooperatives in the domestic and international market spheres apart from enabling consumers purchase products from producers, he added.
On the first day of the event, papers will be presented and discussions will be held at the United Nations Economic Commission for Africa (UNECA) Conference Center in Addis Ababa. The symposium will serve as an opportunity to share international and national experiences, take best practices and achievements amongst cooperatives, as the Director General elaborated. For his part, Senior Public Relations Expert at the Agency Daniel Abebe said that cooperative unions play an indispensable role in supplying raw materials to industries and satisfying public demand. Cooperatives in Ethiopia referred as ‘poverty eradicating tools and growth boosting mechanisms.’
They are supporting the government and the society in solving different economic, social, cultural and environmental problems. For these and other similar reasons, the government has been giving due emphasis to the development of the sector. As a result, over the past few years, the number of cooperatives has been increasing significantly, Daniel further elaborated.
The market share of cooperative unions is also growing from time to time through supplying consumption goods with affordable price to the public, according to him. Mentioning that more than 50 cooperative unions are exporting coffee, spices, honey and other agricultural products, he said that in the past fiscal year, they have generated over 300 million USD. Attaining the 2030 Sustainable Development Goals is highly relies on the contribution of cooperative unions in the country, he furthered. On the event, 250 cooperatives will take part in the exhibition and bazaar at the Addis Ababa Exhibition Center.
Agriculture inputs suppliers, consumptions goods, household products and service providers drawn from all the states and the two city administrations will display and sell their various types of products and services. Agricultural products like Teff, coffee, honey and butter will be displayed and sold. Likewise, a number of agricultural inputs and machineries will be exhibited by innovators and suppliers, he said. He also said that such kinds of exhibitions are important to purchase household and other products with reasonable price.
“The main objective of the exhibition and symposium is to create a robust and sustainable market linkage among suppliers and buyers. And the exhibition will be a platform to showcase how cooperative unions are supporting nation’s socio-economic integrity” Currently, numerous cooperative unions are running in the country. More than 19 million citizens are believed to be members of cooperative unions that totally run over 22 billion birr capital, he indicated.
Even though, cooperatives and unions contribute greater share in nation’s economy, the challenges they face in today’s competitive business world is enormous and more complex than ever before. The challenges, in turn, are lowering the extent of their development and hindering them not to get their business on the right track. For instance, challenges ranging from failure to have business information at the desired level to low market linkage among others are exigent them hugely. Thus, mitigating challenges of the sector is fundamental to enhance the socio-economic benefit of peoples, he noted. “More than 1.5 million citizens are employed under the umbrella of cooperative unions in the country.
The exhibition is participatory and compensating for all cooperative unions operating in the country.” Having such exhibitions is playing a promising role to augment the contribution of cooperatives to the overall socio-economic development of the country. On top of this, currently, more than 10 universities have opened new cooperative departments to involve students with first and second degree programs.
These and other efforts of the government, hopefully, will end up the challenges the sector encountered in human capital and cultivate nation’s endeavors to realize support to its economic growth. As reports indicate that cooperative unions have been playing a catalyzing role in transforming agriculture mechanization, expediting industrialization and supporting Ethiopia’s sustainable development goals realization.
Higher officials, sector practitioners, stakeholders and other participants will also take part on occasion to motivate the sector contribution to the national economic growth. A symposium at the Economic Commission for Africa (ECA) is part of the sixth cooperative unions’ exhibition, bazaar. On the symposium best sector experiences, ways forward and the agency’s platform on general cooperatives will be discussed intensively
Herald February 6/2019
BY TEWODROS KASSA
