[ad_1]
The Ministry of Commerce and Industry recently announced that it plans to allow the country to earn up to $ 9 billion over the next ten years from the export of manufactured products. One of the strategies in this regard is to attract Foreign Direct Investment.
In addition, it is also working to place the country among the top 50 countries in the world in terms of ease of doing business to further its quest for industrialization.
Contacted by The Ethiopian Herald, Shimelis Arega, a senior communication expert at the Ministry of Commerce and Industry, said the ministry is striving to improve the country’s ease of doing business by raising its score from 48 to 80 percent. Furthermore, it has also given due emphasis to the modernization of the manufacturing industry.
In addition, he stated that increasing the quality inspection of export and import products from the current 650,000 metric tons (MT) to 1,058,781 MT and 1,950,000 MT to 3,485,630 MT respectively by 2022 is also part of the ministry’s ten-year strategic plan to achieve its goal. wanted. goal in the sector. Five million new job opportunities will also be created in the sector, ”he added.
Noting that the ministry is also working to ensure the competitiveness of the market, he said that according to its 10-year plan, the ministry plans to increase the current share of the manufacturing sector in industrial from 6.8 to 17 percent. In addition, it plans to increase the sector’s average production capacity from 50 to 85 percent.
Key opportunities helping Ethiopia achieve this lofty 10-year plan include the United States’ African Growth and Opportunity Act (AGOA), which will benefit manufacturing industries in sub-Saharan countries over the next five years; the European Union’s duty-free and quota-free market opportunities for developing All But Arms (EBA) countries, as well as generalized special preferential trade agreements with Japan, China, India and Turkey.
“Being able to export 90 percent of our products in all signatory countries of the African Free Trade Agreement (AFTA) without tariffs or quotas in the next ten years is also a golden opportunity for us to achieve our goal,” he said. “This will undoubtedly make us the main manufacturing centers on the African continent.”
As for him, there are a number of advantages investors gain from investing in Ethiopia, including the construction of the Great Ethiopian Renaissance Dam (GERD), which could help tap into the abundant energy supply potential the country’s electricity company, the active labor force,
the green legacy campaign, market access in many parts of the world. Furthermore, the country has become one of the preferred investment destinations in Africa.
The ministry has identified and given due attention to two types of group products in its 10-year plan based on their demand in the global market, technology requirements, job opportunities and the potential to diversify exports.
Consequently, the first group of products identified as priority areas for the first five years of the plan are agroprocessing (food, beverages, sugar, meat and milk, honey and wax), leather and leather products, textiles and clothing, inputs for construction. (cement and metal), basic chemical inputs, pharmaceutical and medical equipment, paper production (cellulose production) and printing, wood products, agricultural inputs (fertilizers and pesticides), plastic / PVC, ICT and electronics (assembly work) .
In the second group, the main focus will be on industrial products that require knowledge and skills, resources and infrastructure, as well as a high level of connectivity in the second half of the 10-year plan.
These include chemicals, metal and engineering products (automotive equipment), manufacturing machines (textiles, leather, and paper), plastic / polymer, medical equipment, and electronic component manufacturing of various components.
As for him, the construction of a reliable and updated information point / OTC information system, the development of a research-based marketing chain, the improvement of legal frameworks (proclamations, regulations and directives), as well as improving the ease of doing and starting Businesses have been identified as the main implementation strategies of the plan.
The Ministry has already started various activities that aim to develop a marketing chain based on research, approaching, adopting and transferring latest generation technologies and products that reinforce production and productivity at the international level, establishing a digital marketing system and modern. and eliminate market information gaps with the help of systems and technology.
As for the Ministry, Ethiopia has significant natural and human resources that can attract a lot of investors. Regarding natural resources, the availability of three million hectares of fertile land and a favorable climate for the production and cultivation of cotton, large-scale agribusiness (vegetables and fruits, oilseeds and legumes) and livestock are found between resources. which can be used as a springboard for the growth of light industries.
In the same way; The availability of more than 300 million tons of iron, 50 million tons of copper, as well as 30 million tons of zinc reserves, in addition to other chemical and human resources, are also opportunities available to investors seeking to participate in the heavy industry.
Due to these facts, the ministry has also planned to stimulate the development of the manufacturing industry by ensuring the participation of national investors. In addition, priority has been given to the manufacturing industry that uses domestic resources competitively to meet both domestic and export demands in the next ten years.
In an attempt to create a wealth of job opportunities, increase the contribution of the manufacturing industry to GDP, and align the development of the industry with the green and sustainable economic development strategy, the government plans to provide many incentives to investors. .
Sign up for free AllAfrica newsletters
Get the latest African news straight to your inbox
In addition to the effort to attract new investment, the plan also aims to boost the production capacity and productivity of existing manufacturing companies.
The ministry also identified some of the potential challenges in achieving the plan. Strong competition in the international market in terms of quality and quantity of products, the complexity of international trade systems and laws, the impact of COVID-19, limited access to financing and foreign exchange, and the fact that AGOA will reach its end in 2025. have been mentioned as the main challenges of the 10-year plan.
The ministry also invites foreign investors to work in joint ventures with Ethiopian investors, especially in value-added and other areas of investment. Improving the quality of exportable products and focusing on high-tech industries have also been identified as efficient solutions to increase the competitiveness of the manufacturing industry.
Above all, expanding manufacturing industries that replace strategic inputs, increasing the number of small and medium manufacturing industries from 2,000 to 11,000, improving product quality, increasing competitiveness, attracting quality investments and focusing on high-tech industries are the main ones. targets for the next ten years in the manufacturing sector, like Shimeles.
