• Kaki`s Japan-made Isuzu vehicle assembly plant one step towards realizing industrialization
Following the economic and political reformation, several changes are being witnessed all over the country. The economic progress which is being registered all over the nation and several manufacturing plants that are creating job opportunities for thousands of citizens are a good indication how the government is decisively working to achieve its goals and its reform is sound. Vehicle assembly plants are among these manufacturing sectors that are attracting foreign investment and creating job opportunities for Ethiopians.
As the experiences of other countries indicate, vehicle assembly plants play a significant economic role in developing countries like Ethiopia. These plants contribute to the growth and development of the country’s economy in several ways. What is more, vehicle assembly plants can also serve as a platform for export-oriented manufacturing. By producing vehicles for both domestic and international markets, developing countries like Ethiopia can enhance their export potential and earn foreign exchange.
Lately, the first Isuzu vehicle assembly plant was inaugurated in the outskirt of Addis Ababa, Alemgena, West Shewa Zone of Oromia State in the presence of senior government officials and others. Speaking at the event, Minister of Transport and Logistics, Alemu Simie (PhD), said that in the ever growing competitive transport sector, having a vehicle assembly plant has a crucial role for the economy.
According to him, assembly plants have a significant role in saving foreign currency to the country. In this regard, the Ministry will work aggressively to support the efforts of local producers.
He also said that the newly inaugurated Japan-made Isuzu vehicle assembly, sales and post-sales center will play a significant role in creating employment opportunities for citizens and supporting the national economic reform.
Speaking on his part, Managing Director of Kaki Motors Private Limited Company, GebreMichael Girmay, said that the assembly plant will be very instrumental in replacing imported products with local products. It is learned that the newly inaugurated center will assemble 2,500 trucks per year when it is operating at full capacity.
Vehicle assembly plants are one of the areas where manufacturing industries contribute to the industrialization process of developing countries. They help in diversifying the economy by establishing a manufacturing sector and creating job opportunities for the local population. Industrialization plays a crucial role in the Ethiopian economy, contributing to its growth, development, and overall transformation.
As the nation invests its energy and capital on agricultural sector, industrialization also helps to diversify the economy by moving beyond traditional sectors such as agriculture. What is more, by promoting the growth of manufacturing industries, Ethiopia reduces its reliance on a single sector, thus enhancing economic stability and resilience.
Job creation is the other most important factor that is given a special attention by the government. Industrialization leads to the creation of employment opportunities, particularly in the manufacturing sector. As industries expand, they require a skilled and semi-skilled workforce, leading to job opportunities for the growing population. This helps in reducing unemployment rates and poverty levels.
Productivity is another area where industrialization plays a key role to the growing economy of the nation. Industrialization is linked to increased productivity levels in the economy. Modern manufacturing techniques, machinery, and technology improve efficiency and output, leading to higher productivity levels across various sectors. This increased productivity contributes to economic growth and competitiveness.
As the nation works aggressively to expand its industrialization, value addition and export growth will play key role to earn hard currency. In this regard, industrialization enables value addition to raw materials and agricultural products, transforming them into finished goods. This adds value to the products and allows for higher export earnings. By expanding its industrial base, Ethiopia can increase its export capacity, generate foreign exchange, and improve the balance of trade.
Above and beyond, industrialization drives the development of infrastructure, including transportation networks, power generation, and telecommunications. These infrastructure investments support the growth of industries and facilitate the movement of goods and services within the country and for export purposes. In this regard, the more the nation exerts its effort on the industrial sector, the more it gives chance to infrastructural development.
Technology transfer and innovation are the other important areas where industrialization gives an opportunity. Industrialization attracts foreign direct investment (FDI) and partnerships with international companies. This facilitates the transfer of technology, knowledge, and best practices to the local workforce and industries. It promotes innovation, research and development activities, and technological advancements, which further contribute to economic growth.
Industrialization also plays a significant role to increase government revenue through taxation and tariffs. As industries grow and expand, the government can collect more tax revenue, which can be reinvested in social and economic development projects, such as healthcare, education, and infrastructure. This in turn will help the government to fight poverty-which is number one enemy of growth.
As the experience of developed nations witness, industrialization plays a crucial role in reducing poverty, in this regard, the more the nation gives an opportunity to the industry sector, the more it can minimize poverty by creating employment opportunities, increasing productivity, and generating income.
Overall, industrialization plays a vital role in transforming the Ethiopian economy by creating jobs, diversifying the economy, increasing productivity, promoting export growth, and driving overall economic development.
BY NAOL GIRMA
THE ETHIOPIAN HERALD SUNDAY EDITION 22 OCTOBER 2023
