Expert: lack of private sector-led activities delays growth potential
Private sector development specialist said that lack of Ethiopia’s private sector-led economic activities and various challenges in the economy have delayed the growth potential.
Afework Yohannes, a Private Sector Development Specialist was a panelist at the “Private Sector Development in Ethiopia: Enabling Policy Environment, Practices and Lessons” discussion held on the sideline of Addis Chamber’s 75th year’s anniversary on Tuesday.
Afework, who is also a CEO and Principal Consultant at BCaD Consulting Management PLC, states that the private sector can’t access the amount of finance it needs to get. He also states that there are logistics-related infrastructural problems, electric power disruptions and lack of access to land.
“Due to these problems and a gap in skill Ethiopia’s private sector is at its infant stage even after 30 years of economic reform,” Afework complained. “Ethiopia’s private sector is infant even compared to our neighboring countries”.
Lack of resource is among the challenges the private sector is suffering from.
Especially in recent periods industries run by the private sector have been challenging by lack of security across the country and access to foreign currency.
“Even though the private sector is generating a foreign currency, it can’t use that finance,” Afework grumbles.
The government announced recently that the manufacturing industry is producing at 49.2% of its potential. However, Afework refuted that. “The figure needs further reassessment,” he said further arguing, “The potential of the manufacturing sector run by the private sector is exaggerated”.
“The government should harness the potential of the private sector to achieve the goal of enabling Ethiopia to be an upper-middle income nation as it has stipulated under the ten-years-perspective-plan,” he recommends.
Meanwhile, Aynalem Abayneh (PhD), Founder and CEO of Goldie Management Consultancy Service PLC, who was another panelist, for his part suggests that capacitating the private sector should be a prior task to harness its potential.