Interview: Chinese engagement propels Ethiopia's development of industrial parks

Sandokan Debebe, CEO of Ethiopia's Industrial Parks Development Corporation (IPDC), speaks during an interview with Xinhua in Addis Ababa, Ethiopia, on June 8, 2022. Ethiopia aspires to further strengthen cooperation with China in the development of industrial parks to realize its aspiration of becoming the manufacturing hub of Africa, Sandokan Debebe has said. (Xinhua/Michael Tewelde)

ADDIS ABABA, June 29 (Xinhua) -- Ethiopia aspires to further strengthen cooperation with China in the development of industrial parks to realize its aspiration of becoming the manufacturing hub of Africa, an Ethiopian government official has said.

Speaking to Xinhua recently, Sandokan Debebe, CEO of Ethiopia's Industrial Parks Development Corporation (IPDC), said Chinese engagement in Ethiopia's industrial parks development endeavor is very significant. He said the Ethiopian government envisages further strengthening its cooperation with China to tap into the sector's huge potential in enabling the country's economic transformation.

Debebe told Xinhua in a recent interview that despite the impact of the ongoing COVID-19 pandemic and other international phenomenon, Ethiopia anticipates to remain China's preferred destination in the African continent in the development of industrial parks and investments inside the parks.

As the East African country envisions becoming the manufacturing hub of the African continent with extensive investments in the development of industrial parks, Debebe emphasized that Chinese engagement is powering Ethiopia's ambition.

"They (Chinese partners) are going side by side, and it is definitely accelerating our journey of changing our economic structure from agriculture sector to industry-led economy," said Debebe.

He said Ethiopia, Africa's second most populous nation with over 110 million total population, offers a conducive investment landscape as well as geographical advantage for Chinese investors to engage in Ethiopia's industrialization ambition.

"This huge population is an accessible, trainable and also affordable workforce. So, we still expect that Chinese investors will be choosing the country as a prior destination for their investments in the sector," he said.

According to Debebe, Chinese engagement was vital in Ethiopia's ambition towards the construction and commissioning of industrial parks to support the country's economic restructuring towards industrialization.

"From the origin of the idea, the construction, the operation stage, in each phase and stage, the role of Chinese investors and the Chinese government is very significant," Debebe said.

The IPDC chief emphasized that Ethiopia followed China's footsteps in the development of state-of-the-art facilities towards attracting potential export-oriented international companies.

"Even before we established this corporation (the IPDC), the concept of building industrial parks or industrial zones was induced by Chinese investors. The Eastern Industry Zone was introduced before we even established the regulatory framework, and even before we exercised the concept of industrial parks in the country," he said.

Located about 40-km south of Addis Ababa, the Ethiopian capital, the Eastern Industrial Zone (EIZ), was built and operated by Chinese companies. The EIZ is widely viewed as the benchmark for the development of industrial parks in Ethiopia towards becoming the light manufacturing hub of Africa in the near future.

"The success story and the achievements that we harnessed from this investment (EIC) led the government to decide on a bigger scale," Debebe said.

According to Debebe, the Ethiopian government, as part of its commitment to devise the country's economic restructuring model, had initially assessed China's experience in the development of industrial parks and special economic zones.

"The delegates that were assigned to make assessments were staying in China for a longer time to learn from the success stories -- the model, the infrastructure and so on. After our government assessed the impact, the possibility and the opportunities that we can harness from this tool, we embarked on the industrial park concept," he said.

He said Chinese companies were the major players in realizing Ethiopia's ambition of building state-of-the-art industrial park infrastructures throughout the country.

"Chinese companies were the ones who managed to build these facilities in nine months and so on. Once we started finalizing the construction and jumped into the operation phases, the first investors were also from China," Debebe said.

"Not only as pioneer investors in the industrial parks, even as of today, majority of our investors are also from China," he added.

Presently, the IPDC manages 13 industrial parks, majority of which were built by Chinese construction companies with Chinese technology and standards.

Debebe said the Ethiopian government, working along with its Chinese partners, has successfully built trust among international investors to commit their capital and technology inside the industrial parks and manufacture their products targeting the export market.

"It was not an easy task; but by now, we have learned from how we built, how we operate, and also the investors established the trust. This trust will be growing in the future," he said.

The IPDC chief said Ethiopia and China have recently signed a cooperation agreement to revitalize the investment and trade attachment on the backdrop of the challenges imposed by the COVID-19 pandemic, with particular emphasis on strengthening cooperation on industrial parks.

He further said the Ethiopian government is currently working on different reforms to transform the country's industrial parks development and investment portfolio and ecosystem.

"The reforms that we are doing (aimed to create) a more conducive environment for foreign and local investors. This includes the Chinese investors that have good experience, and stood up with us even in a difficult time; and we recognize that," the IPDC chief said. 

Sandokan Debebe, CEO of Ethiopia's Industrial Parks Development Corporation (IPDC), speaks during an interview with Xinhua in Addis Ababa, Ethiopia, on June 8, 2022. Ethiopia aspires to further strengthen cooperation with China in the development of industrial parks to realize its aspiration of becoming the manufacturing hub of Africa, Sandokan Debebe has said. (Xinhua/Michael Tewelde)

Sandokan Debebe, CEO of Ethiopia's Industrial Parks Development Corporation (IPDC), speaks during an interview with Xinhua in Addis Ababa, Ethiopia, on June 8, 2022. Ethiopia aspires to further strengthen cooperation with China in the development of industrial parks to realize its aspiration of becoming the manufacturing hub of Africa, Sandokan Debebe has said. (Xinhua/Michael Tewelde)