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A Launch Workshop on Ethiopia’s Productivity Report Held in Addis

 

Policy Studies Institute (PSI) and National Graduate Institute for Policy Studies (GRIPS) conducted a workshop on Ethiopia’s macro level productivity report on February 17, 2020 at Intercontinental Addis hotel. The workshop was attended by distinguished government officials including Her Excellency W/ro Meseret Meskele-Deputy Commissioner of National Planning Commission, diplomats residing in Addis, and researchers drawn from various institutes. 

The workshop was opened by a welcoming address of Dr. Yohannes Ayalew, Acting Director General of Policy Studies Institute (PSI). In his welcoming speech, Dr. Yohannes stressed that top priority must be given to productivity policy agenda to achieve sustainable development goal. The Acting Director General handed the 132 page productivity report book over to W/ro Meseret Meskele after acknowledging JICA and GRIPS for funding and contributing in the preparation of the report.

The keynote speakers were Japanese ambassador to Ethiopia, His Excellency ambassador Daisuke Matsunaga and Prof. Kenichi Ohno from GRIPS. They started their remark by recalling Ethiopia’s development programs and her achievement of fast economic growth. They reflected on similar viewpoints that Ethiopia has made great growth progress so far and had great potential for economic development but her productivity level is much lower compared to countries such as Cambodia, Vietnam, Tanzania, and Myanmar. The ambassador has reflected on the basic findings and facts of the report book, particularly he highlighted the ten uncovered facts as well as the ten policy recommendation presented in the report for the enhancement of Ethiopia’s manufacturing productivity level.  

It was learned from the organizers of the workshop that this research report is the first scientific and comprehensive study on Ethiopia’s productivity performance. The research team has been conducting a rigorous survey on the productivity level of workers at garment plants of Hawassa, Bole Lemi and Mekele since 2018.  It was stated in the report book that the factory workers have sufficient education and quick learning curve but lack industrial work discipline and motivation, unhappy due to low wage and high rate of staff attrition.

According to the findings of the report presented by Dr. Kidanemariam Berihe, Lead Researcher at PSI and the leading author of the report, Ethiopia’s overall labor productivity grew at an annual rate of 5% during the last one and  half decades. The presented data and figures indicate that Ethiopia’s productivity level is far below latecomer competitors such as Vietnam, Cambodia, Tanzania and Myanmar. According to the authors, the service sector stands out in terms of high labor productivity while manufacturing and agriculture lag far behind. The authors further reported that Ethiopia’s manufacturing labor cost per employee grew at 10.3% per year when manufacturing labor productivity grew only at 5% per year. The authors have recommended their advice that labor productivity and wage must rise in tandem for sound development.

It was stated in the research report that low-income countries such as Ethiopia should reinforce productivity in manufacturing followed by service sector as it is a natural development process to arrive at a level of middle-income economy. Otherwise, the study report cautions, Ethiopia will witness a symptom of middle-income traps and may face the future risk of ‘premature de-industrialization’.

There was a discussion session in which questions, views and comments were raised by the workshop participants. Each question and comments were addressed by the presenters and authors of the research report.

Finally, the workshop was wound up by the closing speech of HE Dr. Yohannes Ayalew.

 

 

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