112017Apr
Ethiopia cements its economic reform through the construction industry

Ethiopia cements its economic reform through the construction industry

From being heavily dependent on importing cement, to producing its own stock, Ethiopia is reeling in foreign investment and opening up new channels for job creation.

It’s a light at the end of a very dark tunnel for Ethiopia, a country that knows the taste of being in a state of emergency. In 2013, the country’s economy placed 78 percent of the population in poverty. This, however, seems to be changing.

Ethiopia’s entrance into the cement manufacturing and export industry has not only aided dire local infrastructure development, it’s also attracted foreign investment and eased unemployment levels.

In March, Ethiopia’s Industry State Minister Dr. Alemu Sime expressed confidence in its cement production plants, saying local production had grown by over 10 percent in the past year. The east African country has just signed a Memorandum of Understanding with China for skills transfer and other industry-related knowledge.

The jump in productivity has been astronomical. According to local reports, the number of cement and chemical producing industries in Ethiopia rose from 18 in 2003 to 66 in 2007. In the cement industry alone, there are an estimated 13 factories which produces over 12 million tonnes a year.

Industry leaders project that by 2025, cement production would increase to 17 million tonnes per annum. Furthermore, programmes to train locals is part of the plan to continue to meet demand.

The forecast has had a positive effect on foreign investment. In 2015, the country made an estimated USD 13 million from exports to Kenya, Djibouti, Somalia and Sudan.

From a country that once met its cement needs solely through import, to becoming a cement-producing region which exceeds local needs and competes in the export arena, Ethiopia could be on track to reverse its economic woes.

LEX Africa Ethiopian member is Tadesse Kiros Law Office

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