Economic measures that the government of Ethiopia has taken over the last 15 years resulted in halving poverty and in increasing life expectancy. Agriculture and manufacturing sectors contributed in greater proportion to the feats.
However, the economic challenges of various sorts are still facing the country, unemployment standing high shouldered.
A country like Ethiopia with a bulging productive population can have an enormous demographic advantage to transform its socio-economic conditions, as studies show. Diametrically opposite to this, unless the youthful population engages itself in economic activities, in one way or another, it will end up being a counter-productive force.
Recently, the government has put in place jobs creation national committee which Prime Minister Dr. Abiy Ahmed chairs. Among others, the committee ensures the creation of three million jobs during the fiscal year in effect.
The high-level committee comprises the Deputy Prime Minister, Presidents of the nine Regional states, mayors of Addis Ababa and Dire Dawa cities as well as two representatives from the Office of the Prime Minister and ten federal ministries.
Preliminary tasks have so far been done, as the government revealed. And the task targeted to overcome macro, structural as well as sectoral bottlenecks, says the Prime Minister’s Advisor, Mamo Mihrete on Monday, speaking at a forum the Office of the Prime Minister organizes. Hence, the jobs creation will rest on solid rock, according to him.
The government has designed home-grown economic reform program, a detailed program meant to address economic challenges including forex shortage, debt burden, inflation, credit problem (facing the private sector) and unemployment, Mamo says.
The government will take macro-economic measures such as enhancing its project execution capacity and arresting inflation as well as increasing the forex inflow, he adds.
In addition to creating a healthy business environment to investors, modernizing the logistics’ services and boosting power supply will get prime focuses as per the structural reform, according to him.
Speaking of the sectoral reform, he says besides working to increase product and productivity and encouraging the manufacturing sector, special importance will be attached with the mining sector and the creative industry, such as ICT, to create more jobs in the country. To him, the creative industry and ICT could be a new source of growth.
The job creation plan, however, operates in a healthy business environment.
Series of works that could improve the over-all business environment has so far been done. Investment Commissioner Abebe Abebayehu explained, at the same occasion, that the tasks carried out to ease doing business in Ethiopia have brought encouraging results.
The trade law has been revised and now commercial registration and licensing have become easier. Also, tax collection has been modernized than ever. Financial supplies have also grown, even by formulating a law that allows credit access with a movable asset as financial security. The reform has relaxed doing business so greatly, as he explains. “All in all, the government’s objective is ensuring a transparent, cost-effective and predictable business environment.”
As the manufacturing sector is one of the growth promoters which many scholars also concludes, Ethiopia has installed industrial parks of various sorts across the country, and in good proximity to Djibouti Port. So far, the parks created over 50,000 jobs and increased foreign earnings by 150 percent.
On top of this, the new scheme is to encourage more private investment through accessible credit. Even in the past fiscal year, as the data show, public spending has been trimmed and the finance channeled to the private firms exceeds by 50 percent as compared to the preceding similar period.
Commercial Bank of Ethiopia (CBE) president Bacha Gina revealed as CBE alone has granted 22.5 billion Birr to the private sector. It also allocated around two billion USD to this sector.
By the fiscal year in effect and to encourage more entrepreneurial skills, the government will also allocate adequate finance to the private investors, as it was leaned.
The past fiscal year had been used to restructure debts and obtain more forex, among others. And the government has revealed as the plan for this year is to get into practical tasks of job creation.
The Ethiopian Herald August 16, 2019
BY WORKU BELACHEW
