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2021

16 Jun 2021

Inauguration of Ethiopia's first Coffee Training Center as part of the PCP’s focus on the agro-processing sector.

15 Jun 2021

UNIDO, China and Ethiopia launch a project on upgrading the livestock value chain as part of the PCP.

15 Jun 2021

18 May 2021

Ethiopia's Prime Minister Abiy Ahmed inaugurates the third Integrated Agro-Industrial Park established as part of PCP Ethiopia.

1 May 2021

Inauguration of the first Creative Hub in Ethiopia to support creative industries and entrepreneurship as part of the PCP’s focus on leather and leather products.

1 May 2021

13 Mar 2021

Prime Minister Abiy Ahmed inaugurates the Yirgalem Integrated Agro-Industrial Park (Sidama State) established as part of PCP Ethiopia.

7 Feb 2021

Prime Minister Abiy Ahmed inaugurates the Bure Integrated Agro-Industrial Park (Amhara State) established as part of PCP Ethiopia.

7 Feb 2021

2 Feb 2021

Government of Ethiopia shares its PCP experience and lessons learned as part of a PCP peer learning session organized by UNIDO.

2019

17 Jul 2019

China's South-South Cooperation Assistance Fund supports PCP Ethiopia's livestock value chain development project.

17 Jul 2019

23 May 2019

Inauguration of a common production facility for footwear at the EIFCCOS leather cluster in Addis Ababa.

2018

11 Sep 2018

Over 300 company applications for occupancy status in the IAIPs received by the Regional Industrial Park Development Corporation -  7 companies approved,  including 5 international companies from China, Netherlands, Republic of Korea and Sudan.

11 Sep 2018

1 Mar 2018

Integrated agro-industrial parks (IAIPs): Review of engineering designs completed and detailed environmental and social impact assessments under finalization. Ethiopia’s Second International Agro-Industry Investment Forum held in Addis Ababa.

1 Feb 2018

UNIDO finalizes the Leather Initiative for Sustainable Employment Creation (LISEC) project document for submission to EU delegation. Construction of horizontal infrastructure for the 4 pilot IAIPs commences between January-March 2018.

1 Feb 2018

2017

1 Dec 2017

European Union approves new programme (EUR 15 million EU Trust Fund contribution): "Leather Initiative for Sustainable Employment Creation (LISEC) in Ethiopia". LISEC will be implemented by UNIDO, the Ethiopian Industrial Parks Development Corporation, and other national and international non-governmental organizations. It aims to create job opportunities, particularly for youth, through the development of the Ethiopian leather industry and the Modjo Leather City industrial park. European Investment Bank in final negotiations with the Government of Ethiopia for investment in the construction of the Modjo Leather City. UNIDO submits project concept note “Capacity-building to upgrade the livestock value chain in Ethiopia” to the South-South Cooperation Assistance Fund of China.

1 Aug 2017

Infrastructure designs finalized for the four pilot IAIPs and associated rural transformation centres. Regional Industrial Park Development Corporation commissions contractors for start of construction activities for the parks, such as building compound walls and drilling boreholes. Environmental and social impact assessments for the four pilot IAIPs commence.

1 Aug 2017

1 Jul 2017

A further expansion of the PCP national coordination body from six to eight task forces.

16 Apr 2017

Detailed engineering designs for 4 integrated agro-industrial parks finalized and submitted to UNOPS for review. Government of Ethiopia, China and UNIDO sign a Joint Declaration on a partnership to promote investment, industrial park development, and technical and vocational education.

16 Apr 2017

1 Mar 2017

Inauguration of 3 integrated agro-industrial parks to be developed within the framework of PCP Ethiopia in the Amhara, Tigray and Southern Nations, Nationalities and People’s region respectively.

1 Jan 2017

Workshop on new large-scale programme for upgrading the livestock value chain in Ethiopia, held in Beijing, China.

1 Jan 2017

2016

1 Jun 2016

Foreign diplomatic missions in Addis Ababa participate in a briefing session led by the Ministry of Foreign Affairs on the PCP and the upcoming International Agro-Industry Investment Forum.

1 May 2016

Government of Ethiopia allocates USD 300 million towards the development of infrastructure for integrated agro-industrial parks (IAIPs). Local investment forum in Addis Ababa promotes IAIPs Ethiopia investment promotion roadshow to Italy (Modena, Parma, Rome and Milan). Ethiopia investment promotion roadshow to Hamburg, Germany.

1 May 2016

16 Apr 2016

First International Agro-Industry Investment Forum in Addis Ababa.

1 Apr 2016

Ethiopia investment promotion roadshow to Hannover, Germany, at the occasion of Hannover Messe. Joint Steering Committee mobilizes funds for PCP components from development partners and development finance institutions (DFIs). Ethiopian diplomatic missions abroad participate in a seminar on the PCP and the upcoming investment forum to mobilize investment in priority sectors. Feasibility studies and investment profiles presented for loan/grant negotiation with DFIs.

1 Apr 2016

1 Feb 2016

Implementation phase for integrated agro-industrial parks officially launches.

2015

1 Dec 2015

Fourth ISID Forum titled "Partnerships: Moving Sustainable Development Goal 9 into action" held in Vienna.

1 Dec 2015

1 Nov 2015

Pre-investment forum held in Addis Ababa to announce the date of the first of its kind International Agro-Industry Investment Forum. Co-organized by the Government of Ethiopia and UNIDO, the event will be held in 5-7 October 2016 in Addis Ababa on the theme of “Unleashing Ethiopia's investment potential”. More than 200 investment profiles and ten green field investment projects are being prepared by UNIDO for presentation to international and local investors at the upcoming forum. $10 million soft loan for industrial infrastructure from the Italian Development Cooperation under negotiation, to be released to the Government of Ethiopia in December 2015.

1 Oct 2015

Five project proposals in the fields of agro-food, energy and environment submitted to partners. The projects have a total budget of $7.3 million.

1 Oct 2015

1 Sep 2015

Preparations underway for an international investment forum to be held in Addis Ababa, May 2016. Organizing committee set up, and tentative date and venue established. Funding mobilization for the development of Modjo Leather City infrastructure underway.

1 Aug 2015

Feasibility studies for the four Integrated Agro-Industrial Parks and associated Rural Transformation Centres completed and are under review by different stakeholders. Ethiopian delegation visits UNIDO headquarters to discuss PCP progress.

1 Aug 2015

1 Jul 2015

Third International Conference on Financing for Development held in Addis Ababa, 14 July 2015. Third ISID Forum held in Addis Ababa, 14 July 2015.

1 Jun 2015

Capacity-building programme for the Ministry of Industry and three national institutes started. Investing in Africa Forum "Partnering for accelerated investment, industrialization and results in Africa". The Forum ─ co-organized by UNIDO, the Government of the People’s Republic of China, the Government of Ethiopia, the World Bank Group, the China Development Bank and the China-Africa Development Fund ─ was held in Addis Ababa, 30 June-1 July 2015.

1 Jun 2015

1 May 2015

Development of 150 small-scale and 50 large-scale investment profiles started (to be ready by end of June). 15 industrial associations in OECD and Asian countries identified for possible partnerships.

1 Apr 2015

Completion of feasibility study for one Integrated Agro-Industrial Park and surrounding Rural Transformation Centres; three others to be completed by-mid June. 10 Ethiopian Government officials visit Malaysia, Viet Nam and Thailand to meet with potential investors for Integrated Agro-Industrial Parks.

1 Apr 2015

1 Mar 2015

High-Level Joint Steering Committee established. National Technical Task Force established. Feasibility study, business plan and design for the Modjo Leather City finalized and endorsed by the Government. Private sector and International Finance Corporation (IFC) negotiations underway for the establishment of an integrated textile industry (cotton production, ginning, spinning, textiles and garment manufacturing).

17 Feb 2015

Government of Ethiopia approves the PCP Programme Document.

17 Feb 2015

2014

17 Dec 2014

UNIDO Executive Board approves PCP Ethiopia.

17 Nov 2014

Second ISID Forum: PCP Ethiopia is presented to Member States.

17 Nov 2014

17 Aug 2014

First technical mission to Ethiopia to develop the PCP.

17 Jun 2014

First ISID Forum: Ethiopia announced as one of the PCP pilot countries.

17 Jun 2014

Introducing Ethiopia

Ethiopia is a federal democratic republic with nine states and two city administrations. With an estimated population of 94 million, it is the second most populous country in Africa. It is also one of the continent's fastest growing economies. The country’s gross domestic product (GDP) was USD 46.87 billion in 2013, with a growth rate of 10.4 per cent the same year and an average growth rate of 10.9 per cent since 2004. The rate of growth is projected to average 7.3 per cent from 2015 to 2018.

Economic growth is primarily driven by government-led development policies, with a rapid expansion of public infrastructure and basic services. Increasing exports and foreign direct investment have also fuelled growth.

Agriculture remains central to the country’s structural transformation and poverty reduction efforts. The agricultural sector contributes 44 per cent of GDP, while industry’s share remains relatively small, accounting for 13 per cent of GDP. The manufacturing subsector amounts to four per cent of the overall GDP.

National development targets

PCP ETHIOPIA

A unique opportunity to boost the economy

UNIDO has been actively involved in Ethiopia since 1968, with nearly 300 projects covering a wide range of technical assistance interventions, such as vocational training, cluster building and value chain development. In addition, between 1999 and 2008, UNIDO implemented two phases of its Integrated Programme for Ethiopia.

The Programme for Country Partnership (PCP) for Ethiopia brings together development partners, UN agencies, financial institutions and the business sector ─ under the leadership of the national Government ─ to help achieve the goals set out in the country’s industrial development strategy and Growth and Transformation Plan II (GTP II, 2015-2020).

The PCP focuses on three light manufacturing sectors: agro-food processing; textiles and apparel; and leather and leather products. These sectors were chosen due to their prospects for job creation, strong linkages to the agricultural sector, high export potential and capacities to attract private sector investment. They will act as a springboard for the transformation of Ethiopia's economy from one based on agriculture, to one driven primarily by light industries.

UNIDO has a technical team dedicated to executing the PCP at its Vienna headquarters.

Ethiopia: moving towards inclusive and sustainable industrial development (2014)      Play video

Today's landscape

Ethiopia is endowed with a good climate, abundant arable land, adequate rainfall and a range of ecological zones. Developing land for increased agricultural output, however, requires significant investment in infrastructure, such as roads and electricity. Moreover, the agricultural sector is dominated by smallholder farmers, making it difficult to organize raw material supply for agro-industries. As a result, many of the food processors are operating below their maximum capacity.

Agribusiness development is crucial for sustaining Ethiopia’s economic growth. Agro-industries account for the largest share of the country’s manufactured goods, with food and beverages constituting approximately 52 per cent. An improved investment climate alone, however, has not been sufficient to attract investors to the agro-processing sector in places where there is high economic potential. This is mainly due to the lack of proper infrastructure and inadequate supply of raw materials.

Outlook

UNIDO is working with the Government of Ethiopia to establish four Integrated Agro-Industrial Parks (IAIPs). The IAIPs will focus on adding value to locally sourced agricultural products and will address constraints for private sector development. The parks will provide large- and medium-scale firms with industrial land, access to infrastructure and utilities, as well as business services. At the same time, they will serve as a platform for catalyzing investment and job creation.

Rural Transformation Centres (RTCs) will also be set up around each IAIP. They will serve as aggregation points with a modern warehouse and market facilities, where private sector investment can promote key input markets, such as fertilizers and hybrid seeds, and where farmers can sell their produce.

Today's landscape

Ethiopia grows some of the world's finest cotton and has a rich spinning and weaving history. An abundance of raw materials, low energy costs and a vast labour force provide Ethiopia with a comparative advantage over other countries. Presently, more than 230 large and medium-scale factories and 11,800 small-scale enterprises operate in the sector.

The country has also attracted significant international buyers and investors in recent years. A number of foreign garment companies, such as Wal-Mart (United States), Jiang Lianfa Textile (China) and H&M (Sweden), have invested and registered in Ethiopia. Total investment in the textile sector exceeded USD 1.2 billion over the past five years, and created over 50,000 jobs.

However, like the agro-food processing sector, raw material shortages are one of the main challenges faced by Ethiopian textile and clothing industries. Production and supply chain inefficiencies along the cotton-to-textile value chain also constrain the country’s ability to compete at the global level.

Outlook

Together with its partners, UNIDO will support the Government of Ethiopia and the private sector in its efforts to increase the supply of quality raw materials, upgrade workforce skills, build the capacity of support institutions along the value chain, and improve trade logistics. The PCP will also promote investment opportunities in integrated textile mills.

Today's landscape

Ethiopia's leather sector enjoys significant international comparative advantages owing to its abundant raw materials, highly skilled workforce and low costs. Ethiopia has one of the world’s largest livestock populations with 52 million cattle (first in Africa and sixth in the world), 27 million sheep (third in Africa and tenth in the world) and 23 million goats (third in Africa and eighth in the world).

During the fiscal year 2012/13, over 68.33 million square meters of leather were processed into footwear for both domestic and international markets, contributing roughly 44 per cent to the manufacturing sector. The leather industry currently employs approximately 14,000 people.

However, the leather industry remains constrained by a shortage of hides and skins, out-dated equipment, insufficiently skilled labour, low capacity utilization (tanneries operate below 50 per cent of their installed capacities), and the lack of price incentives for superior quality goods.

Outlook

The PCP is supporting the Government of Ethiopia in the establishment of a leather industry cluster on the basis of an existing concentration of tanneries in the town of Modjo. UNIDO is finalizing a feasibility study on the founding of the Modjo Leather City and will support the Government in mobilizing resources for its establishment.

The PCP will also help set up four footwear and leather goods clusters, and strengthen the fashion design and training capabilities of the Leather Industry Development Institute (LIDI).

Today's landscape

Industrial zones provide enterprises with basic infrastructure - roads, energy, water, sewerage, telecom services - and inexpensive land. They also act as a catalyst for private investment and provide an opportunity to link local small-scale suppliers to resident manufacturers, allowing local firms to further integrate into global value chains. Indeed, many multinational companies have relocated their factories to Ethiopia given the country’s low labour costs and eligibility under the Africa Growth and Opportunity Act (AGOA) for duty-free exports to the United States.

The first government-run, large-scale industrial zone - the 156-hectare Bole Lemi Industrial Zone - was designed to attract export-oriented agro-processors, pharmaceutical companies and textile manufacturers. It currently hosts textiles and leather products manufacturers.

Outlook

The Government is planning to develop four additional industrial zones in Dire Dawa, Kombolcha and Hawasa, expand the Bole Lemi Industrial Zone and provide support to several industrial parks developed by the private sector.

UNIDO will work with PCP partners to prepare feasibility studies, mobilize capital, promote investment, and link small and medium-sized enterprises to larger companies operating in the industrial zones. The Organization will also help improve services rendered by support institutions and cooperate with its partners to ensure that infrastructure projects are aligned with potential economic growth corridors.

Today's landscape

With Ethiopia’s rapidly expanding economy and increasing orientation towards international markets, the country aspires to join the World Trade Organization. To do so, the national quality infrastructure needs to have the capacity to deliver quality assurance services according to international trade-related standards.

In order to optimize the development of light industries in Ethiopia, inefficiencies in trade logistics also need to be addressed. These include high freight-handling costs, high costs of financial services, long delays in the authorization of letters of credit, as well as complex customs procedures and high customs costs.

Outlook

The PCP will help national quality assurance-related institutions to develop and apply quality standards and certification schemes in conformity with international market requirements, in particular for industrial zones. UNIDO will also work with its PCP partners to set up a trade knowledge centre to provide information on import-export procedures, tariffs, and best practices in logistics operations. This will help to reduce information asymmetries among public institutions, businesses and investors.

An analysis of the current institutional responsibilities and regulatory powers will be conducted to identify redundancies and improve ineffective procedures in public institutions. Public officials will also benefit from training courses on trade facilitation.

Today's landscape

Industrial parks are major consumers of energy and require an uninterrupted supply. However, for industrial parks located in isolated areas, energy access is constrained by limited infrastructure and an unreliable power supply. This not only leads to lost production time, but also higher input costs if energy is not consumed efficiently.

While Ethiopia ranks as Africa’s largest meat producer, an estimated 300,000 tons of animal by-products are dumped annually in open fields. Apart from the loss of valuable economic resources, such volumes of waste create an environmental problem.

Outlook

With this in view, the PCP will promote the use of locally available renewable energy resources, such as bio-waste or small hydropower stations, to power industrial park operations. A more systematic approach to energy efficiency is expected to lead to substantial energy savings and increased industrial productivity.

The PCP will also help the Government to develop industrial complexes with higher environmental standards and improved waste management systems. In addition, UNIDO, together with its PCP partners, will set up a rendering industry to generate semi-products for the downstream manufacture of a variety of industrial and food products, initially targeting seven export-oriented slaughterhouses.

Today's landscape

Strong national institutions are essential for Ethiopia to achieve its national development goals and capitalize on the large investment flows coming into the country. The Government has recently established a number of new institutions to support the industrialization process, in addition to upgrading existing ones. However, challenges remain in terms of coordination between the various institutions, as well as limited human resource capacity for addressing strategic and structural issues within the institutions themselves. In addition, there is limited national industrial data to support policy design and implementation.

Outlook

In order to address some of these institutional challenges, UNIDO ─ in collaboration with its PCP partners ─ will strengthen the capacity of the Ministry of Industry to generate industrial intelligence, in particular for agro-industries. It will also support the establishment of an industrial observatory to centralize all industry-related data, alongside an effective monitoring and evaluation system. The PCP will also help the Government to institutionalize South-South and Triangular Industrial Cooperation.

PARTNERS

The African Development Bank (AfDB), European Investment Bank (EIB), European Union (EU), Food and Agriculture Organization of the United Nations (FAO), International Fund for Agricultural Development (IFAD), International Finance Corporation (IFC), United Nations Development Programme (UNDP), World Bank (WB), as well as China and Italy are among the key development partners operating in Ethiopia. Development partners provide support through short- and medium-term interventions to upgrade infrastructure, increase agricultural productivity, generate youth employment, and develop the financial services sector. The various programmes and projects are aligned with the Government’s Growth and Transformation Plan. 

Watch this video for more information.