BY BACHA ZEWDIE
Sidama National Regional State, which owns a large amount of natural resources, has many favorable conditions for the development of the investment sector. Among its natural resources, Hawassa Lake, hot springs, and landscapes that can be used for various agricultural and tourism activities are mentioned. These resources of the region are blessings that make the country proud, motivate investors to engage in investment, and create favorable conditions to answer the public’s demand for development.
The region is also home to various investment destinations. They include the huge Hawassa Industrial Park and Yirgalem Agricultural Products Processing Industrial Park. There are also many industries operating in the region by government and private sector. The Hawassa textile factory, which is being expanded with 2.5 billion Birr to turn it into an industrial park, is another destination for investment in the region.
There are favorable conditions in terms of infrastructure. In addition to the Addis Ababa Hawassa Expressway, Mojo Hawassa Expressway is under construction. From the construction of this road, the construction of Mojo Zwai Road has been completed and put into operation. It also owns an airport.
Sidama region is also the location of products that strongly support the country’s economy by earning high foreign exchange. The resources this region contains, that includes coffee and other resources; are serving the country beyond the region. The universal wealth and potential of the region is expected to attract the attention of investors.
Zenebe Legese, Chief Commissioner of the Regional Investment Commission had a moment with the Ethiopian Press Agency. In the interview, he discussed about the investment potential of Sidama National Regional State and the sector’s activities.
As to the commissioner, Sidama region has great investment potential. The region produces agricultural products that are used as inputs for the industrial sector. Many grain crops, vegetables and fruits, coffee, milk, chicken, honey, meat and others are produced there. The region’s natural resources create opportunities for investors who want to engage in industry and service sectors in addition to agriculture. In the mining sector, there are more than 17 types of minerals in the region.
Among the things that make the region preferred by investors is relatively better infrastructure provision (roads connecting kebeles and districts). It is also a safe and peaceful region. The presence of a young workforce looking for work; the fact that the road from Addis Ababa to Nairobi passes through Hawassa (capital of the region); and the fact that it has a strong monitoring and support system are among the factors that make it preferable. To make the region benefit from the resources, many investment development
works have been carried out. By organizing four industrial cluster zones in the region, remarkable work has been done to prepare the resources of the region for investors. Efforts have been made to promote the region’s investment potential and favorable conditions. It has been discovered that many investors are interested in engaging in investment activities in the region.
There are 2,301 investment projects in Sidama region. Among them, 1,867 are operational whereas 464 projects have been revoked because they did not get license. The investments that are operational have benefited more than 52 thousand people with job opportunities. In addition to the agricultural and industrial sectors, many investors are also engaged in the service sector, hotels and entertainment, technology and other sectors in the region.
The attention paid to the investment sector has achieved results. Investment capital, which was not registered for 26 years from 1994 to 2020, was registered in 2022. In 26 years, the investment capital was three point two billion Birr, and in 2022 alone, it became seven point three billion Birr. In terms of issues that have received attention at the country level, 550 hectares of land has been prepared for investors engaged in summer wheat cultivation.
In 2022/23, it was planned to give licenses to 400 investors and it was possible to give licenses to 165 investors in the first five months. This year’s performance is better compared to the same period of last year. These projects have benefited more than 16,000 citizens with job opportunities.
In the first five months of this fiscal year, it was planned to give 160 hectares of land to investors and it was possible to provide 583 hectares of land. The regional investment commission’s project monitoring and support sector monitors and supports the status of investment projects. The performance of the projects and their deficiencies will be monitored. In this regard, it was planned to monitor 309 investment projects in the five months and it was possible to achieve more than planned.
One of the areas of investment that the region has focused on is to provide value added products to the market. Sidama region is one of the regions of Ethiopia with great potential in coffee resources. There are 700 coffee industries in the region. Sidama coffee has won the Cup of Excellence for three consecutive years. From this point of view, it is a matter of marketing including the value addition that has been given attention and the direction to work on. Thus, an Italian company that provides value added coffee has started operation in Yirgalem Integrated Agro-Industrial Park.
When foreign investors participate in domestic investment activities, they are expected to bring finance and technology with them. In this regard, the region is working diligently to ensure that young people benefit from job opportunities, to use the financial and technological potential of investors, and to build the capacity of local investors and increase their participation.
Industrial parks in the region are making a big contribution to the growth of its investment. They are equipped with complete infrastructure, which makes the work of investors relatively easy and fast. The huge Hawassa Industrial Park has created great opportunities for investors engaged in the manufacturing sector. An integrated Agro-Industrial Park also helps investors in agriculture and agricultural products to tap into the potential of the region’s agricultural sector. Bensa Middle Industrial Park is also a manufacturing area that can be an additional potential for investment in the region.
Participation of local investors in the region’s investment sector has been improving. However, their participation in the industrial sector is still low. For example, among the manufacturers in Hawassa Industrial Park, only three are local investors. Therefore, increasing the participation of local investors requires attention, so recently, during the promotion of Yirgalem Integrated Agro-Industrial Park, 106 local investors were registered.
The commissioner further said that, incentives of the region to increase inflow of investors will be implemented according to the provision of incentives prescribed by decree and directive. The region supports and encourages investors based on “Investment Decree 1180/2012” and other legal provisions. Preparing sites includes performance of monitoring and supporting activities offered to investors to facilitate conditions for them to get up and running quickly.
There are gaps in investment performance in Sidama region. One of them is to fence off the land that investors have taken for investment for a long time. This will cause the investors to lose the multi-faceted benefits that they and the country will get if they come to work. In response to this, in the last five months, 68 projects have been notified and put into operation. The land taken by 19 investors has been returned to the land bank.
Lack of long-term credit is another challenge in the investment sector. There are also some remote districts where there are occasional power outages. On the other hand, there are no instances where bureaucratic hassles become a hindrance to the sector. Investors who submit legitimate investment requests are processed quickly.
The main next plans of the Sidama Region Investment Commission are to strengthen the inflow of investment and give special attention to investment projects that involve technology transfer. In this way, sustainable activities are carried out that guarantee citizens to benefit from the investment sector.
Supporting local investors who can be a reliable guarantee for sustainable development and growth of the country will also be a matter of attention. Without peace, investment is unthinkable. The steps taken to establish peace have given hope to investors as well as to the entire society. From this point of view, the region’s administration keeps the peace in the Sidama region and work diligently to grow the investment sector. The Chief Commissioner assured that, the region is ready to host investors who are interested in investing in various investment sectors in the Sidama region.
The Ethiopian Herald January 3/2023
