Chinese engagement propels Ethiopia’s industry park development ambition

Chinese engagement has injected impetus in Ethiopia’s ambition to become a manufacturing powerhouse by 2025 through the development of industrial parks across the country.

The two countries on Tuesday announced a partnership to build a new 300 million U.S. dollar industrial park in the east African country.

The newly unveiled industrial park, which will be built in Ethiopia’s Adama city, capital of its largest Oromia regional state, will be the second Chinese-contracted industry park in Adama.

The first Adama industry park that was inaugurated and commissioned back in October last year.

Liu Yu, economic and commercial counselor at the Chinese Embassy in Ethiopia, said in a recent interview with Xinhua that construction of the second Adama industry park is expected to start before the end of 2019.

According to Liu, about 85 percent of the funding needed to build the new industrial park will be covered through Chinese government concessional loans, and the remaining 15 percent will be allocated from the Ethiopian government.

“The planned industrial park will focus on attracting firms engaged in equipment manufacturing,” Liu said, adding that efforts are underway to finalize land acquisition and financing-related procedures.

Adama, about 99 km south of the national capital, Addis Ababa, is a key commercial hub in central Ethiopia, which has recently witnessed major economic transformation with the help of Chinese finance and expertise.

“The governments of China and Ethiopia have attached great importance to their cooperation in various fields including in the construction of industrial parks, whereby they have achieved fruitful results,” Liu told Xinhua.

The first Adama industrial park, which was built by China Civil Engineering Construction Company, was inaugurated by Ethiopian Prime Minister Abiy Ahmed in October 2018.

The industry park, which is regarded to have strategic economic position due to its location along the Ethiopia-Djibouti standard gauge railway and with direct rail infrastructure to the Djibouti port, is one of the nine industrial parks that the Ethiopian government has built along the Ethiopia-Djibouti economic corridor.

Covering 100 ha of land, the current Adama industrial park has attracted several local and international companies that are specialized in textile, apparel, and machinery production.

The 756-km Ethiopia-Djibouti electrified railway, which was built by two Chinese construction firms, China Railway Group and China Civil Engineering Construction Corporation, is now managed by a consortium of Chinese companies for a period of six years.

The plan to build the second industry park in Adama city also came as the east African country looks to commission another highly anticipated industrial park in Dire Dawa city, some 450 km from Addis Ababa.

“Works at the Dire Dawa Industrial Park are nearly finished,” Wang Kun, project manager of China Civil Engineering Construction Corporation (CCECC), told Xinhua recently.

“As it stands, close to 97 percent of the work has been completed, with only water treatment and landscaping works remaining,” Wang added.

According to the Ethiopian Investment Commission (EIC), the 158 million dollar Dire Dawa Industrial Park is expected to host investors from such sectors as heavy industries, textile and apparel, vehicle assembly, food processing, electronics, and chemicals.

The government expects the industrial park, when operational, will create direct and indirect job opportunities for close to 40,000 Ethiopians. Wang said construction of the project has already hired more than 7,000 locals.

The CCEC, which also built the Adama Industrial Park, also constructed Ethiopia’s flagship Hawassa Industrial Park, considered by the government as “a model industrial park.”

According to the EIC, the Hawassa Industrial Park has generated 142 million dollars from the export of textile and apparel products during the 2018/19 Ethiopian fiscal year, which ended on July 7. Enditem