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| Friendship Square at Sheger Park Addis Ababa Ethiopia |
Written By Esubalew
Ginbar Amente (MBA)
Ethiopia has
been among the fastest-growing economies in Africa with an annual growth rate
consistently well above the African and global averages. This outstanding
performance contrasts with the slow progress in structural transformation, lack
of economic diversification and weak productive capacity. In order to overcome these
socio-economic and development challenges, Ethiopia has prepared and
implementing ten years development plan recently.
In fact, it is
over six decades since Ethiopia adopted a planned approach to development. In
the last two decades, the main drivers of the economic development agenda in
Ethiopia have been the five-year development plans that the country has been
implementing since 2001. Altogether, Ethiopia has launched four consecutive
five year development plans including the Second Growth and Transformation Plan
(GTP II) (2015- 2020) - to guide the overall development of the country. The
first three plans gave due priority to propoor economic sectors including
agriculture, while the latest plan gives more emphasis to industrialization,
particularly manufacturing. As a follow-up to GTP II, and in conjunction with
the homegrown economic reform agenda, the government has prepared a ten-year
development plan and ratified by parliament recently to serve as a strategic
roadmap and policy direction for the coming five to ten years.
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| Ethiopian Electrified Train |
In line with ten years development plan, the homegrown economic reform (HGER) with the central objectives of sustaining rapid growth, maintaining stable macroeconomic environment by reducing debt vulnerabilities and creating adequate and sustainable job opportunities has, therefore, been domestically initiated. The economic reforms are being translated into action through policy that enhances the suppy side of the economy. The main aim and focus of the HGER is the enhancement of productivity and competitiveness of the overall economy, and a gradual transition from public to private sector-led growth. The HGER plan was classified into macroeconomic reforms, sectoral reforms, and structural reforms.
The ten-year
development plan has emphasised the linkages between various sectors of the
economy. The plan recognizes the high interdependence and interconnectedness of
the various productive sectors, particularly, modern agriculture, manufacturing
and mining through input-output linkages. Trade and logistics, as well as
services, were also closely coordinated with the productive sectors of the
economy in order to improve their efficiency by linking sectional products with
the markets. Similarly, infrastructure development (transport connectivity,
energy, irrigation, communications, etc.) were planned in such a way that the
development of one sector would serve as the base for the development of other
sectors, while human resources and technology, which are decisive factors for
ensuring productivity, have been planned in a similar approach so that the
coordination would enhance the development of all other sectors.
The key
strategic pillars of the ten-year development plan are: ensure quality growth,
improve productivity and competitiveness, undertake institutional
transformation, ensure private sector's leadership in the economy, ensure
equitable participation of women and children and build climate resilient green
economy.
On average, in the next ten years, the country economy is targeted to have grown by 10.2 percent. In order to bring about structural transformation of the economy, the share of the agricultural sector in GDP is projected to decrease from 32.6% in 2019/20 to 22% in 2029/30. The share of industry, on the other hand, is projected to rise from 29% to 35.9% and that of the service sector would increase from 39.5% to 42.1%. Within the industry sector, the share of manufacturing is projected to grow from 6.9% to 17.2%. The unemployment rate in urban areas is expected to down to a single digit and stand at nine percent. Furthermore percentage of population below poverty line is projected to decrease from 19% in 2020 to 7% in 2030.
The overall development goal is to achieve improved welfare of the society by improving the standard of living and quality of life that are captured in the broader national prosperity vision. These development vision and objectives will be achieved through key strategic pillars which are primarily focused on addressing the deep-rooted macroeconomic, sectoral, and structural bottlenecks of economic, social, administrative, and institutional development of the country.
Generally, the
ten-year development plan lays a long-term vision of making Ethiopia an “African Beacon of Prosperity” by maintain
sustainable growth and achieve structural transformation, as well as attaining
equitable distribution of wealth and shared prosperity in 2030.
** This is an opinion article by an external contributor. The views belong to the writer.
the author can be reached through esuablewginbar83@gmail.com or esubalewbuze83@yahoo.com
