Entrepreneurship & Sustainable Economic Development in Ethiopia Endalkachew Sime Deputy Secretary General and Advocacy Dept. Manager ECCSA. On behalf of Mulu Solomon (Mrs.) PRESIDENT Ethiopian Chamber of Commerce and Sectoral Associations- ECCSA
Points included in this presentation o Introduction n Definitions n Background of the subject (African Context) o The Ethiopian Sustainable Economic Development (SED) o Entrepreneurship in the Ethiopian SED o ECCSA and Entrepreneurship 2
Sustainable Economic Development (SED) v Sustainable Economic Development is a pattern of economic growth in which resource use aims to meet human needs while preserving the environment; so that these needs can be met not only in the present, but also for generations to come. (different sources) v SED has three pillars Society Economy Environment 3
Entrepreneurship Ø Ø Entrepreneurship can be defined as the process of using private initiative to transform a business concepts into a new ventures. The word entrepreneur is derived from the French verb enterprendre, which means to undertake Ø It is undertaking value addition through Creativity, Innovation and Profitability. 4
Background of the subject (African Context) 5
Background CTND ü ü Past approaches to development FDI and exports as main drivers of growth (extreme dependency) Currently countries are rethinking their growth strategies from relying on FDI and exports as main drivers of growth to shifting some of their resources to domestically-oriented enterprises and local demand potential. ü Current approach: n n Private entrepreneurship is key driver of growth and employment Government plays coordinating/complementary role to market forces, beyond the basic functions 6
Ethiopia s Economic Development ü Three economic eras the Emperor era, the Derg era and the current era. ü We focus on the current era. ü The economy has shown a continuous and a-two-digit growth, and this would place Ethiopia among the fast growing countries in the world. Some figures and facts 7
GTP predictions (base case and higher case scenario) 8
IMF prediction 9
Sustaining Ethiopia s Eco. Dev t. Ø The field of sustainable development can be conceptually broken into four constituent parts: environmental sustainability, economic sustainability, social sustainability and political sustainability (Wikipedia the Free Encyclopedia). the basic among these is an economic sustainability, which is seeking to reach in knowledge-based economy which is based on entrepreneurial activity and the environmental sustainability that deals with the resource base. o Resource base environment o Entrepreneurship 10
Resource base Environment o GTP, 2011: p. 119 q Environmental conservation plays a vital role in sustainable development. Building a Green Economy and ongoing implementation of environmental laws are among key strategic directions to be perused during the plan period In 2011, Ethiopia developed Green Economy Strategy 11
Entrepreneurship in the GTP The Industry section of the GTP has v 4 STRATEGIC SECTIONS v 6 OBJECTIVES v Major targets 12
The 4 STRATEGIC SECTIONS of the GTP a) Micro and small enterprises (MSEs) development This is expected to create jobs in urban areas and increase rural-urban and urban-to-urban functional and economic linkages. b) Medium and large industries development, which includes 1. Textile and garment 2. Leather and leather products 3. Sugar and sugar related industries 4. Cement 5. Metal and engineering 6. Chemical 7. Pharmaceutical 8. Agro-processing c) Industrial zone development (for medium and large manufacturing industries) d) Public enterprises management and privatization 13
The 6 Objectives of the GTP o MSE development o Full utilization of industrial capacity o Use of domestic raw materials and job creation (for medium and large industries) o Increase in private sector investment o Employment generation, import substitution and foreign exchange earnings o Local production of machinery and spare parts 14
The targets of the GTP (selected) Sub-sector Unit Base year 2009/10 Target for 2014/15 Multiples Industry zones Number of factories in zones - 164 - Public enterprises Gross value-added in million birr 2.26 5.32 2.4 times MSEs - job creation Employment in thousand - 2,970 - MSEs - training of trainers Number of trainees - 10,000 - MSEs - training of operators Number of trainees - 3,000 - MSEs - manufacturing land Hectare - 15,000 - MSEs - shades Number - 21,591 - MSEs - buildings Number - 819-15
ECCSA in promoting entrepreneurship in Ethiopia v In the Ethiopian chamber system, Entrepreneurship Development practices are majorly seen in a form of business development support services. v City chambers and sectoral associations, which are the direct contact points of the business community, are the prime figures in providing company-level BDS services. v The national chamber(eccsa) focuses on the macro level of support that primarily deals with facilitating a better doingbusiness environment. 16
ECCSA v Currently, ECCSA is providing the following services that directly or indirectly promotes entrepreneurship development at macro level: ü Providing key information in promoting trade and investment through different publications and channels like exporter s guide, business directory, newspaper, website and documentaries. ü Providing trade information services by an organized information centre. ü Voicing out the interest and concerns of the private sector in the process through conducting different researches. ü Conducting international trade fairs in view of promoting the manufacturing sector of the country. 17
ECCSA ü PPDs (Sectoral, regional and federal levels; - arms - PSD Hub and PPCF. ü Facilitating exports by certifying local exportable products. ü Organizing exposure visits for the business community to attend international events like trade fairs and exhibitions. ü Chamber Academy: the new entrepreneurship development-related venture of ECCSA...in its attempt to usher the growth of the private sector. Building Leadership and Management capacity MBOs Hub and incubation centre for business managers and leaders 18
With Complements from ECCSA 19