Ameliorating the Manufacturing Sector Helps The Nation Economy
As a sovereign and independent state, Ethiopia has gone through different internal and external pressures. However, its government and citizens have always seen prosperous land beyond the problems and the pressures. That is the reason why the country is always remarked as one of the long existed nations in the world.
Despite unjust pressures from outside and unrest in the country during the past few years, the government and the people of Ethiopia have been working in unison to build a better country in any aspect.
The past three years were the hardest period in Ethiopia’s history with internal conflict and external pressures from mighty states more of from the Western World. However, the people and the government didn’t lose hope to uplift the country from where it is. On the inauguration ceremony of the establishment of the democratically elected new government, the President and the Prime Minister of Ethiopia have put economic challenges experienced, gains registered, and plans for the coming five years.
The expectation of reform and change from any new arrangement and establishment of a new government commonly characterizes people all over the world. In this regard, Ethiopia owned a newly established government this year that is democratically elected by the people. After conducting the 6th national election, the people get their representatives by their votes. Thus, Ethiopians from every corner expect something new from the new government to be fulfilled this budget year and during the coming five years of its reign.
Cognizant of this expectation, President Sahlework Zewdie and Prime Minister Abiy Ahmed (Ph.D.) discussed in their speeches at the opening ceremony of the new parliament about the possibilities of change in the Ethiopian economy in the coming years. They said that the new government will apply different economic strategies and approaches to tackle the existed inflation and other economic constraints in the country.
On the ceremony of sworn of the oath, the Premiere highlighted that the action taken in the past years didn’t bring as was expected, so the new government plans to use the private sector as a key player coupled with a government-supported market and economic system.
According to an Economist Dr. Jemal Mohammed, this idea of including and letting the private sector plays a pivotal role in the economy that realizes public beneficiary and prosperity of the country.
As to the Economist, the main area that should be focused on is Public-Private Partnership (PPP). The private sector is the main participant in the export sector. This means that private-owned companies have been involving in exporting goods to bring foreign currency and importing various items to the country. Thus, the government should support the private sector to be involved highly in the manufacturing sector.
During an interview with The Ethiopian Herald, the Economist noted that his prediction for the new government is to take a step forward on the import and export sector. To this end, the new government should enhance the manufacturing sector via interlinking with the agriculture sector and other stakeholders.
The manufacturing sector in Ethiopia has brought plenty of benefits and promising outcomes even though its beginning is very recent. For instance, the two most prominent countries India and China have done various things in the service and manufacturing sector. India focuses on service sectors like medicine, and China focuses on manufacturing products. As it is vividly seen, China’s development is better than that of India in a way that China has been working mainly on the manufacturing industries than India. “We, Ethiopian’s, thus, should get a lesson from China on how its economy boosted from time to time,” the Economist noted.
Regarding the idea outstretched by Prime Minister Abiy Ahmed (Ph.D.) that comprising the private sector in the building of the nation’s economy, Jemal highlighted that when the country incorporates the private sector to play the leading role in the economy, it should not be with the expectation of swift change in a short period of time. As it can be seen from experience, there are different challenges the private sector encounters. The international gigantic corporations may bring immediate export return technology advancements faster than the local ones. In the long run, however, the government needs to include local and foreign private investors to take Ameliorating the manufacturing sector; booming the nation’s economy part in the manufacturing industry, and bring the intended change.
On the other hand, the government has plenty of duties to ensure economic growth in the country. When putting the private sectors in the front lines, the government should carry out different tasks to backing them. These tasks include facilitating enabling conditions and taking risks. Facilitating means the government should make accessible the necessary infrastructures for the private sector to achieve its goals. Again, when saying the government takes the risk, it means that there are things that the private sector and investors should also do to start their businesses related to land and loan obtaining. Therefore, the government will be the one that takes more responsibilities and risks on behalf of the investors. This will help them to do their business freely without any pressure.
Regarding the private sector, Jemal (Ph.D.) pinpointed that the new government should support ideas from the private sector as it is the major contributor to the import and export sector. The private sector is the one that can apply necessary changes in the companies to be competitive in the global market. Government-owned companies cannot apply dynamic changes within them due to various reasons. Therefore, the government must pave the way for these privately-owned companies to participate in the import and export at large.
Letting the private sector do their businesses freely helps the investors work on technology dynamism to be more competent in the world market. As it can be witnessed, the government-owned companies were perished due to lack of bringing dynamic change to sustain in the world market. That’s why the government should exert its utmost effort on privatization that the sector takes the lion’s share in building the nation’s economy.
Furthermore, as indicated in the speech of President Sahlework Zewdie on Monday, the government should encourage investors from local and international to establish manufacturing industries in the country. This will pave the way to creating massive job opportunities to meet the ever-increasing job seekers. This idea shows how important to promote the manufacturing sector for economic growth because it creates many opportunities for the citizens to help themselves.
Besides, the other idea raised by Jemal is that the government should push to create a ‘Public-Private Partnership’. This means both the investors and the government share the burdens in relation to the business, and the government will own a 5-10 percent share from the benefits of the business along with other income tax revenues.
The Economist further highlighted that in the past 20 years, the government of Ethiopia has been building infrastructure but not the manufacturing industries to that extent. That was the main pushing factor for the reformist government to focusing on the manufacturing sector during its reign in the past few years. In this regard, the former government started building industrial parks to promote manufacturing.
All in all, the people of Ethiopia will expect better achievements from the new government regarding improving the economy via ameliorating the manufacturing sector. The private sector will also put its fingerprint on the economic growth of the nation. Working together brings better achievements. That’s why the government plans to work for hand in glove with the private sector, it is underlined.