Ethiopia is a country in the Horn of Africa with a population of over 110 million people and a rapidly growing economy. The country has made significant progress in recent years, with an average annual growth rate of around 10%. However, there are still challenges that need to be addressed to sustain this growth and ensure that it benefits all Ethiopians.
One of the key challenges facing Ethiopia is the need for improved coordination and collaboration between the government and the private sector. The government has a critical role to play in creating a conducive environment for private sector investment, but this can only be achieved through close collaboration and consultation with the private sector.
The Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA) is an important institution that helps to facilitate this collaboration. It serves as a platform for the private sector to engage with the government, raise concerns, and work together to find solutions. Through regular consultation forums, the Chamber is able to bring together representatives from the government and the private sector to discuss issues of mutual concern and identify solutions that will enable the private sector to thrive.
The ECCSA serves as a bridge between the private sector and the government in Ethiopia. One of the main activities of the Chamber is to discuss the bottlenecks encountered in the implementation process of policies and procedures, find solutions, and take corrective measures. The Chamber has been organizing consultation forums at various times to create enabling conditions for the private sector to work closely with the government.
Despite it was difficult to make a National Public-Private Dialogue due to the various problems that have occurred in the country in the past three years, it was able to hold a big forum recently to expand the possibility of working closely with the national public and private sectors. Agricultural products processing, tourism, and e-commerce (digital economy) issues were discussed at the consultation forum.
This National Public Private Dialogue was organized by the Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA), the Ministry of Trade and Regional Integration (MOTRI), and the Pan African Chamber of Commerce and Industry (PACCI). These sectors were chosen because they play an important role in the country’s economic diversification and job creation process.
Economists explain that the private sector, which has a leading role in the country’s economy, can fulfill its role properly when it is able to work together with the government. When the government and the private sector work together in consultation, they contribute to the nation’s development and economic growth. Mola Alemayehu (PhD), a professor of economics at Haramaya University and a senior researcher at “Frontieri” research and consulting firm, mentioned that the main development actors in a country’s development are the government, the citizens, and private investors. Mentioning that the government is in charging with enacting laws, designing strategies, and facilitating various favorable conditions, he explained that it is necessary for the private sectors to work hand in hand with the government as they have involved in various investment opportunities across the country.
Investment is the driving engine of a nation’s economy, and the main source of investment is the investor or the business community. If there are gaps, problems, and various hurdles that the government did not notice when designing strategies and enacting laws, the private sectors are responsible to identify the problem in an appropriate way.
The creation of such a platform between the government and the private sector will help to make the business and investment sectors more efficient, the economist accentuated.
According to Mola, this should be done through having regular dialogue. If the government and the private sector can come together and discuss in a formal way, it is seemingly important to identify the problems that can tackle the nation’s economy, he suggested. Furthermore, their strong bond and integration helps the investment in order to achieve better results. Moreover, transferring knowledge and technology will bring meaningful results in the business sector.
Explaining that Public-Private Partnership is known internationally Mola stated that the government is always required to work for the excellent performance of the business sector as a law maker and strategy maker. It is also necessary and expected to discuss with the private sector on what should be included in the sector in order to further strengthen every sectors coupled with to record national economic growth, he added. For him, such consultation forums should be planned and conducted in a regular manner so that the country and the people should benefit from its positive impact on the nation’s economy.
He also underscored that collaboration between the private and public sectors in Ethiopia brings together the strengths and resources of both sectors, allowing for a more efficient allocation of resources and expertise. The private sector brings innovation, entrepreneurship, and market-driven approaches, while the public sector provides infrastructure, regulatory frameworks, and policy support. By working together, they can leverage their respective strengths to create a conducive environment for business growth, attract investments, and stimulate economic activity. This collaboration fosters job creation, boosts productivity, and enhances competitiveness, ultimately leading to sustainable economic growth.
“The partnership between the private and public sectors promotes inclusive and equitable development. The private sector’s involvement in sectors such as agriculture, manufacturing, and services contributes to job opportunities, income generation, and poverty reduction. Through public-private collaborations, targeted interventions can be implemented to address social challenges and promote inclusive growth. For instance, joint initiatives can focus on skills development, infrastructure development in underserved areas, and access to finance for small and medium-sized enterprises. By aligning their efforts, the private and public sectors can work towards achieving shared goals of reducing poverty, improving living standards, and ensuring broad-based economic benefits for the population”, he mentioned.
Agriculture, tourism, and e-commerce are among the main areas of focus for which the government held joint consultations with the private sector. Particularly, agriculture is a critical sector of the Ethiopian economy, accounting for more than 90% of the country’s export trade. However, there are still significant challenges facing the sector, including low productivity, poor infrastructure, and limited access to finance. Through collaboration between the government and the private sector, it is possible to address these challenges and unlock the full potential of the agricultural sector.
By the same token tourism is another sector that has significant potential for growth in Ethiopia, and was amongst the biggest agenda of the dialogue. The country is home to a rich cultural heritage and a diverse range of natural attractions, including national parks and wildlife reserves. However, the tourism industry in Ethiopia is still in its early stages of development, and there is a need for improved infrastructure and services to attract more visitors. Through collaboration between the government and the private sector, it is possible to unlock the full potential of the tourism industry and create jobs and economic opportunities.
The two sides also discussed on the E-commerce activity of the country. During the discussion it has been stated that E-commerce is a rapidly growing sector in Ethiopia, with the potential to transform the way that business is done in the country. However, there are still significant challenges facing the sector, including limited access to finance, a lack of regulatory frameworks, and limited digital infrastructure. Through collaboration between the government and the private sector, it is possible to address these challenges and create an environment that is conducive to the growth of the e-commerce sector
All things considered, coordination and consultation between the government and the private sector are crucial for the economic development of Ethiopia. The Ethiopian Chamber of Commerce and Sectoral Associations should take the lead in organizing regular consultation forums, identifying obstacles faced by the private sector, and finding solutions through collaboration with the government. By working together, the government and the private sector can ensure that investment is not hindered, the economy continues to grow, and the country benefits as a whole. Focus sectors such as agriculture, tourism, and e-commerce should be given priority in these consultation forums to ensure their competitiveness in the global market and to drive economic diversification and job creation.
BY HIZKEL HAILU
THE ETHIOPIAN HERALD TUESDAY 8 AUGUST 2023
