The nation has been achieving a double-digit economic growth for more than a decade. As a result, sectors such as agriculture, service and industry contributed a lot. The achieved economic growth also helps in poverty reduction, job creation and expanding infrastructure. However, still the main driver of the economy is agriculture that is to say it is a means of living for 85 percent of the population and for 80 percent of export earning. This implies that the nation’s economic structure needs change and to make this diversifying the economy is essential.
In this regard, the role of the manufacturing sector is immense. It could absorb the crowded rural labor, support import substitution, expand export, facilitate knowledge and technology transfer, create value chain and ignite innovation. It also make fertile ground for the flourishing of private sector.
The sugar industry is one of the preferable sector that accelerate economic transformation. According to the Director General of the Ethiopian Sugar Corporation with a rank of Minister Shiferaw Jarso the Government is heavily engaged in the construction and expansion of sugar industries. And after the completion it is expected to uplift the nation’s economy. Sugar industry, as part of the manufacturing, has the capacity to link agriculture with industry through squeezing sugar can it produce sugar that can be supplied to domestic and foreign markets. It create job opportunities both at the plantation and factory. It absorb both unskilled rural and skilled labor.
According to Shiferaw, in the first GTP, the government exhaustively engaged in the construction of infrastructures with the support sugar industries. Dams, irrigations, residential houses for workers and schools for local communities constructed and in general about 76 percent of the construction work has been completed. He also stated that the job has been accomplished as per schedule and for this there are many factors. Lack of sufficient human resources, finance and equipment’s can be mentioned in that regard.
And he also added that the remaining task will be accomplished in the final phase of GTP-II. Regarding sugar plantation, currently 70 thousand hectare land covered by sugar plantation and in the coming years the plantation farm will rise to 290 thousand hectares. By now the rate of productivity of sugar plantation is 146 tons per hectare and this will rise to 169 tons per hectare.
According to him, in order to improve the farming productivity improved specious of sugar plants imported from abroad and the increment bases vertical without needing additional farm lands.
The GTP highly emphasizes on the involvement of the private sector in the economy particularly in the manufacturing sector. Because entrepreneurship, skill and innovation can be generated from the sector. In addition, it can reduce the financial burden of the public sector which engaged in huge projects.
Shiferaw also stated that though the government showed interest for the involvement of private sector be it privately or in joint venture in sugar industry still it is reluctant. And some of the reasons for this reluctance is the expensive nature of the construction of dams and irrigation. In addition the limitation of employing heavy machinery make them to stay out of such endeavor. Of course some foreign companies tried to engage in the sector failed to fulfill their duty and interrupted their activities and because of this the government took over the responsibility of completing of the projects.
In this regard, the Arjo Dedessa project can be taken as an example. In this project the Pakistani company tried to plant sugar; however, it failed to install the grinding machine to construct the dam. Then, the government took the responsibility of constructing the project and now it is nearing its completion.
The other benefit that the sugar factory bring to the nation is animal feed stalk. As it is known Ethiopia is the first in the number of cattle population in Africa but its economic value is insignificant because the production system is more of traditional. Neither pastorals nor sedentary farmers have sufficient feed stalk.
When the pastorals are moving from place to place in search of grazing land and water, the cattle are highly vulnerable to drought and climate change. Hence traditional cattle rearing is not feasible; And to change this in to modern type the government put the policy direction and one of the mechanisms to realize this is producing feed stalk from byproduct of sugar molaces and provide to the local market and through this approach the nation can meet 23 percent of the feed stalk.
In this system with relatively small number of animals high meet and milk yield will be expected both for domestic and foreign markets. The other benefit that comes from the sugar industry is the production of bio energy from the byproduct of molasses. Energy is one of the major component of development that the nation badly needed. All the expansion of economic sectors depends on the availability of energy sources.
Currently, the government is aggressively engaged on the development of energy from hydro, wind, solar and geothermal sources and encouraging results have been registered; however, there is still huge unmet energy demand. The bio fuel generated from molasses support to move machinery in the industries.
In sum, the expansion of sugar industries can facilitate the flourishing of manufacturing sector which visualized as a base for industrial led economy; hence, for the fulfillment of the government endeavor all stake holders must be part of it.
[www.ethpress.gov.et]