Ethiopia’s manufacturing sector will receive a financial boost of $500 million, from the country’s largest commercial bank, Commercial Bank of Ethiopia (CBE). The banking company has increased the budget allocation by $200 million in comparison to the $300 released in March. Key market players have, yet, urged for more finances in the sector should the industry produce to its potential capacity.
The manufacturing sector in Ethiopia has an array of business opportunities which investors have been called to seize. Vietnamese companies have shown interest in supporting the industry which has created thousands of job opportunities. Their influence in the sector will spur trade between Ethiopia and Vietnam as well as increase the country’s productivity.
Ethiopia has invested in building industrial parks to be a springboard to economic development. Hawassa Industrial Park that was inaugurated by Prime Minister Hailemariam Desalegn in 2016 is the largest park of its kind on the continent. Bole Lemi I Industrial Park serves the textile and leather products. As part of the nation’s plan to boost the sector, the Government planned to have 15 industrial parks by June this year.
The East African nation is planning to be Africa’s industrial hub by 2025 and has put strategies to achieve its objectives. It has recorded a consistent economic growth and continue to arrest the attention of economists. Its industrialisation efforts have been backed up by Government support as well as investors. The landlocked country counts on foreign investments to catapult its vision.
Besides, local manufacturers have called the Government to put attention to the industry to promote their products. Investment should make home-made products competitive to the global market.
According to a recent study undertaken by the African Centre for Economic Transformation, infrastructure development and low-cost hydropower access have been pillars to the growth of the sector. Increased foreign investments due to business incentives such as tax breaks have seen the sector enjoy foreign firms. The report recorded that between 2002 to 2014, employment opportunities had shot up by 400 per cent to over 200,000 workers.
The industry plays a crucial part in trade through exports. In 2017, the sector earned $463.73 million from export earnings which were disappointing figures falling short by 47.8 per cent of its projected exports. The downfall attributed to a limited supply of inputs and delays in processing.