Chinese enterprises involvement and contribution to Ethiopia’s industrialization

Chinese enterprises involvement and contribution to Ethiopia’s industrialization
File Size:
152.82 kB
Author:
Alebel Bayrau
Date:
25 February 2020
Downloads:
121 x

Development economists and policy makers alike have long recognized the importance of investment as a major source of long run economic growth. Empirical evidence and experiences from East Asian countries show that growth cannot be sustained without technological and industrial upgrading, to which foreign direct investment is central (WB, 2012).  In Ethiopia, the share of the industry sector accounts for only 14% of GDP as of 2016. Its manufacturing subsector is only 5%. The country sets ambitious targets for the manufacturing to account for 18.8% in 2020. Meeting this target hinges on attracting both domestic and FDI manufacturing firms. Following this, the Ethiopian government envisages rapid industrialization through enhancing technological capability and skills development driven by investment linkages. Due to its favorable policy and labor-cost advantages, Ethiopia has already attracted large projects and brand manufacturers in labor intensive manufacturing in textile and garment, leather and leather goods production. 

 
 
 
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