By Tesfaye Getnet
The Tigray Regional State has given plots of land to 220 investors along the outskirts of Mekelle according to Mebrhatu Melese, Head of Tigray Manufacturing Development Agency.
The lands which are mostly given to the local investors will be used for manufacturing companies and will create job opportunities for around 100,000 people.
The aim providing the land is to empower the local companies to grow and serve as an avenue for job creation.
The investors will use the land for pharmaceuticals, agri-business, textiles and related manufacturing industries
Mebrhatu told Capital that more than 1,000 investors are waiting to get land in the region for their business activity. An incentive to potential broadband investors is also planned to enable penetration throughout the region.
“We understand that manufacturing is one of the ways to create more jobs here, we are giving Turkish investors 100 hectares to build their own industry park and do some jobs in furniture chemical and food processing works, we have 1,000 hectares in fenced lands for this sector and we are working to create jobs in agro processing fields also,” he said.
He added that currently more than 200 big and 6,000 small scale manufacturing companies work in the region and these investors will help the government promote the export of goods and services, promote investment from local and foreign sources, and also accelerate export led industrialization.
Manufacturing registered 11 percent increase and manufacturing exports increased more than eleven fold. This was largely thanks to the increasing export earnings of the footwear and apparel industries. The growth represents more than a doubling of manufactured exports’ share in total merchandise exports, which itself more than quintupled during the period.
Nevertheless, manufacturing as a share of gross domestic product in Ethiopia remains 5%, well below the African average of 10%. The country also scores below the African average on diversification, export competitiveness, productivity and technological upgrading.
Despite this, it’s not a long-shot to predict that Ethiopia will catch up with countries like China and Vietnam in some low-tech manufacturing industries in the near future. These are industries for which labor costs are very important. And right now you’d be hard pressed to find a country in the world that has cheaper labor than Ethiopia. Even beyond these obvious industries, there are reasons to believe that Ethiopia might be on the right track to catch up with more advanced economies.