More industrial parks, fewer investors? That’s not what Ethiopians heard all along!

19 Jul

Editor’s Note:

    A regime focussed on robbery to satisfy its greed is always given to empty propaganda. In power, as we see it from the experiences of the Tigray People’s Liberation Front (TPLF), it is bound to experience repeated delusions, as is the case with industrial parks. This is likely to remain a constant problem for our country, which also is increasingly becoming dysfunctional.

    The TPLF suffers from copycatism, in turn forcing the country into engaging in all sorts of experiments, with no official accountability for actions that are bankrupting the nation. This arises from lack of standard of accountability, the TPLF has been superb in obliterating traces of it!

    We have closely watched Arqebe Oqubay, who now has appropriated the industrial park ideas, for that matter without digesting how the Chinese went about it. He capitalised on the thesis by Prof Justin Yifu Lin of China, who in his own right has been aspiring for recognition as the father of New Structural Economics. Its original idea being the theory of state enterprises as economic force.

    The TPLF transformed this for its own empowerment through financing by state enterprises, eventually enabling the Front to dominate the national economy. This has made Ethiopia as one of China’s few guinea pigs, dependent on its loans, economic development approaches. Empowered through this is the TPLF, which has ensured its dominance in the economy, while Ethiopia has remained with no signs of structural transformation whatsoever to make possible its industrialisation.

    All we have seen and known about Arkebe Oqubay is constant editing of himself and everything — including things he has said in public and in an official capacity. Experience has hardly changed him, even if he keeps on receiving from others copy of his original utterances, edited and corrected by others to no avail.

    About a year ago, this blog tried to discuss why the industrial park idea would not work in Ethiopia, a country whose structural transformation has literally stopped.

    Industrialisation is not a copy paste thing, for which TPLF may be good with no beneficial outcomes. However, industrialisation requires sectoral growths evolving into a nation’s development that shows in the changes in the lives of citizens. This is to say not on merely asphalted roads, as the TPLF does, and high rise buildings, owned by the mafia and built on lands seized from ordinary citizens. Why the TPLF does this is clear, the resultant objective being TPLF power and wealth, necessarily tantamount to Tigrean supremacy over other Ethiopians.

    To make matters worse, the developed countries and their international organisations now came forth in September 2016 with the idea of decidedly wanting to use the industrial parks in Ethiopia to serve their interests, i.e., provide employment to jobless Ethiopians, Eritreans, South Sudanese, Somalis to arrest their migration to the developed world.

    In other words, in a country with one of the highest joblessness and migrations, Ethiopia has been required to offer 30 percent of the jobs in industrial parks to those close to a million refugees in Ethiopia.

    TPLF happily agreed in return for a few tens of million dollars and political protection, which means it could stay in power forever, violating the human rights of Ethiopians and killing them. The money so it has received from the West is blood money, so secured through the surrender of our nation’s interests and mortgaging its sovereignty.

    All said and done, including the wasted national resources, the industrial parks are likely to become reminders of not only failed ambitions of a few individuals, but also the TPLF’s unholy motives and the shame stamped on our country’s face.

    Possibly starting next week, the nation shall move to “deliverology”, Hailemariam appeared on television window Tuesday with his pretension, even when he had huge problem pronouncing the word, much less understanding its underlying ideas! Oh God! The man likes to lecture others! Could it be a consequence of his yet unbuilt self — he now needed as powerless prime minister — that has generated inside him a weak ego? That is now hurting our nation more than ever before, through his servile self, as if it is every citizen’s obligation to be enslaved by the TPLF!

    Ethiopia could have been big enough to house all its children, were it not for the greed of the few bent on destroying it if it did not belong to them only!

    This is extremely shameful for Ethiopia and its citizens, falling in this lowest of times and under the whims of dishonest of men, or a group with no faith in the country nor credibility of their own whatsoever!

 

Posted by The Ethiopia Observatory (TEO)
by Addis Fortune: More Industrial Parks, Fewer Investors
 

Problem of logistics service and shortage of water supply are major challenges, especially with Mekelle Industrial Park

The government of Ethiopia has launched the first phases of Kombolcha and Mekelle Industrial Parks that specialise in the manufacturing sector with no firm inside the parks. Officials from the federal government and regional states, including Prime Minister Hailemariam Desalegn, attended the inauguration ceremonies of the parks.

The former has 15 manufacturing sheds whereas there are 13 sheds inside the latter.

Hawassa Industrial Park (HIP) was hosting 15 global textile and apparel manufacturing companies from the USA, India, China and Sri Lanka, and also had six local firms with 2,000 employees at the time of inauguration time. The parks in the north of the country were not in action during the date of their opening.

Mekelle Industrial Park (MIP) in Tigray Regional State, built on a 100ha plot of land at the cost of 100 million dollars, is expected to create 20,000 jobs. The second park, Kombolcha Industrial Park (KIP), located in Amhara Regional State, built on a 75ha plot of land with 90 million dollars, is also expected to host firms which will be able to employ a similar number of people. While MIP intends to specialise in textile and apparel, KIP aims to focus on textile, clothing and food-processing.

“We have set the nest, so the birds now have a place to land,” said Prime Minister Hailemariam Desalegn in a meeting held after the inauguration with the residents of Meqelle city, government officials and the business community.

The government, however, wants to remain hopeful while the manufacturing sheds in MIP are waiting for companies to come in and hire 600 employees in one shift. It is conducting studies to construct the second phase of the park.

“A study for the construction of the second phase of MIP is almost concluded,” said Belachew Mekuria (PhD), deputy commissioner of the Ethiopian Investment Commission (EIC).

The sheds in the industrial parks, which are waiting for investors, are constructed with most facilities that manufacturing companies require. They have included the installations of 850kVA transformers, face security systems, card keys and water sprinklers as well as an air conditioning system.

Moreover, health centres, fire brigades, commercial buildings, and one-stop-service shops are features of the industrial parks. But the waste treatment and disposal plants in both Mekelle and Kombolcha industrial parks are not constructed.

The plants will be constructed and start operation as soon as companies to reside in the sheds start manufacturing, according to Belachew.

As is true for other industrial parks in the country, the construction of MIP and KIP has also been undertaken by foreign companies. The government asserted that it had lost hope in local construction companies to take projects as large as the industrial parks following the poor performance demonstrated in the construction process of the Bole-Lemi Industrial Park.

It is to be recalled that 23 local contractors took five years to complete the first phase of Bole-Lemi Industrial Park, while the China Civil Engineering Construction Corporation (CCECC) took only nine months to complete the construction of HIP.

It seems to be to avoid the delay paranoia that the government gave the construction contract of MIK and KIP to China Communications Construction Company Ltd (CCCC) and CCECC, respectively. Both companies took nine months to construct the parks. However, the supervision work of MIP has been done by the local supervising firm MH Engineering Plc.

CCCC has been operational in Ethiopia for the past two decades. It is working on the expansion project of Bole International Airport and has executed the Addis-Adma express way, as well as the Mekelle-Djibouti railway.

[Atonement for land grab?]

“Children of peasants whose land is taken will get training and will be given priority to work in the industrial park,” said Arkebe Oqubay (PhD), special adviser to the Prime Minister and board chairman of the Industrial Park Development Corporation, during the inauguration ceremony.

Refugees are also among the 20,000 people that are expected to get employment opportunities at MIP after the completion of the feasibility study.

It is known that the country is giving shelter to more than 750,000 refugees, mainly from Eritrea, South Sudan and Somalia. And a year ago, the European Union pledged half a billion dollars to finance two industrial parks in Ethiopia which will create jobs for refugees, a scheme in which MIP will take part.

But all that hope expected in job opportunities including for refugees and foreign exchange earnings from exports will only materialise when companies join the sheds in the parks and start manufacturing.

“The process of finding investors is ongoing,” said Sisay Gemechu, chief executive officer (CEO) of the Industrial Parks Development Commission (IPDC). “The number of investors that are going to start manufacturing in the parks will be disclosed after September once the negotiations are over,” he said.

So far three companies including Velocity Apparel, Dutch Brand Management (DBM) BV and Calzedonia, an Italian textile factory, are said to be the closest global companies to enter MIP, as well as a local company known as MAA Garment & Textile Factory. It has also been announced that the government has already gained the interests of H&M and Vanity Fair. However, the reality is contrary to what the government is saying.

“H&M does not own any factories and is not buying from any factory in Mekelle Industrial Park yet,” Pierre Borjesson, country director of H&M responded to Fortune via e-mail.

Besides putting in efforts to attract international investors, different incentives were provided for local investors to take sheds in the parks. One of the incentives is loan arrangements that go up to 85pc, according to Arkebe.

On the other hand, 55pc of the sheds in KIP are already reserved by different companies including from the USA and South Korea although there is no contractual agreement yet. The companies are engaged in the manufacturing of suits as well as luggage and bags. An Italian company engaged in fabric production is also another company which has requested to construct a shed on 20ha inside the park.

“The real challenge lies in finding investors that are good enough to meet the standards of the industrial parks. A lot of requests to enter the parks have been submitted to us so far. But there are many we have turned down for not meeting the criteria we have set,” Belachew said.

Arkebe shares Belachew’s argument.

“Adding to the complexity of constructing the parks, getting investors is the most challenging part ahead,” said Arkebe in his inaugural speech.
*Updated.
 

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