Ethiopia prioritizes the idea of developing massive Industrial Parks (IPs) aimed at promoting industrialization and substantial amount of job opportunities creation for the growing number of the educated youth population. The development of industrial parks started in 2014 when the Ethiopian Industrial Parks Development Corporation (IPDC) was established. It gained momentum in 2015 with the Industrial Parks proclamation 886/2015. In less than three years, several industrial parks were built, inaugurated and started operations. Currently, remarkable number of industrial parks is operational in which more than 16 parks are developed by the Federal government, 4 by Regional States, and additional 4 by Private developers. Ethiopia plans to increase its total IPs to around 30 by 2025, as part of its efforts to make the country a light manufacturing hub and lower-middle-income economy in the same period.
The development of giant industrial parks has immensely contributed in the socio-economic development aspirations of current Ethiopia. The industrial parks dispersed across the country continue their noble contribution by bringing a glimmer of hopes to the community. The importance of building special economic zones and industrial parks is gaining more attention worldwide. Thus, the Ethiopian government has given due priority towards allocating lands for special economic zones and industrial parks constructions throughout the country. The industrial parks are developed based on the availability of potential industrial raw material inputs in the identified areas to sustainably feed the ever growing manufacturing industries’ inputs demand.
As the African Continental Free Trade Area agreement (AfCFTA) came into force on 30 May 2019, more European and other countries are eagerly waiting to access the 1.2 billion-plus population continent as the future potential market destination through the AfCFTA. Therefore, considering this bigger market, more multinational investors are undertaking pre-investment assessments to join investment in Ethiopia soon.
Construction, textile and garment, agro-processing, pharmaceutical, wood products, plastic materials, chemicals, motor car/bike assembly, electronics products, metal works, among others are the major investment areas inside the industrial parks.
Currently, the industrial parks created job opportunities for millions of youth coming from all parts of the country. The university-industry linkage is fundamental to ensure sustainable supply of competitive human power to the manufacturing industries. The industrial parks have also contributed more in cultivating hard-working culture, master new manufacturing techniques, and share experiences with expatriate professionals in the manufacturing industry. The industrial parks immensely helped the youth to become future employers through nurturing sufficient manufacturing industry knowledge. Therefore, the industrial parks proved successful in upholding prudent youth that are the real asset to realize the country’s endeavors towards industrialization.
Experts in the sector underscored that the industrial parks witnessed tangible role in the country’s transition to industrialization. As the country is blessed with abundant industrial raw materials inputs for manufacturing industries more attention should be given to harness the resource through engaging multinational and local investors.
More importantly, the completion of mega hydropower generating dams like the Grand Ethiopian Renaissance Dam (GERD) will play the central role in the country’s move towards industrialization. The availability of standardized infrastructures such as electricity, water, and transportation network facilitates the growing demand of multinational investors to the country.
Industrial Parks Development Corporation (IPDC) Chief of Staff and Transformation Office Head Addisu Mamo said that the Ethiopian government has given due attention to attract and support globally competitive multinational and local investors to generate tangible foreign currency through exporting products worldwide.
The Ethiopian government has plans to increase the number of industrial parks to one hundred and create more conducive manufacturing industry business environment by the coming twenty years. The corporation has built credibility through successfully accomplishing the constructions of industrial parks within a short period, according to him.
Hawassa, Bole Lemi, and Adama industrial parks are the top succeeding industrial parks through production, export volume, and foreign exchange income.
Bole Lemi Industrial Park General Manager Tinsae Yimam said that the industrial park has generated 44.5 million USD by the past Ethiopian budget year as it targets at boosting manufacturing of export goods. It generated the listed amount amid the COVID-19 pandemic effect of the global market. The park is producing high quality textile products being exported to the international market. It created job opportunities to more than 18,900 youths. The park avails housing and other services to its employees.
In addition, Bole Lemi industrial park has become a center of attention with multinational and local investors following its location at the outskirts of Addis Ababa city. After the second phase of the park’s expansion completion it will have a capacity to accommodate further new investors.
Adama Industrial Park Deputy General Manager Gulilat Abebe for his part said the park has handed over all sheds to investors. Currently, additional sheds are being built by private investors. During the just passed Ethiopian budget year and 7.7 million USD has been earned by exporting textile products from the factories operating inside the park to the European and American markets.
It is expected to earn up to 50 million USD when the rest of the investors fully commence exporting their products. It is planned that the companies who have received work permits in the park will commence operation within the next six months.The park has so far created 7,000 jobs. When the all sheds inside the industrial park are operational, it will have the capacity to employ 20,000 to 25,000 people. The industrial park is also working with pertinent stakeholders in the public and private sectors to increase foreign exchange earnings.
Hawassa Industrial Park General Manager, Fitsum Ketema for his part said that the park has supplied 114 million USD worth of products in the past 11 months. Currently, 35,000 workers are employed in the park. More than 23 multinational investors joined the park from different countries are operating in the park.
Regarding logistics, the manager said that a system has been set up to transport raw materials and products directly from Djibouti to Hawassa and Hawassa to Djibouti, which will enable to provide swift transport services to manufacturers.
BY TEWODROS KASSA
The Ethiopian Herald 22 July 2021
