18 August 2018

Ethiopia: Nation's Economy Needs Revolutionary Reform - Experts

Photo: Addis Standard
Ethiopian birr (file photo).

Ethiopian economy needs strong public private partnership and the current reform should shape the private sector to make it engine of the nation's economy which needs revolutionary change, economic experts said.

During a panel discussion organized by Addis Ababa Chamber of Commerce and Sectoral Association Thursday economists argued that the nation should make the private sector the engine of the economy. They stated that the current reform needs structural changes, clearly defined private and public sector roles and strong public private partnership.

National Plan Commission Commissioner Eyob Tekalign said that the contribution of private sector for the national economy is not clearly figured out yet. He stated that including the ordinary farmers it is expected that both informal and incorporated private sector has contributed up to 80 percent of the nation's economy.

Dr. Tilaye Kassahun Instructor at Addis Ababa University and Abay Bank Board Chairman on the occasion said that currently Ethiopian economy have many blessings, at the same time face serious challenges. Although the country's economy is increasing continuously during the past ten years on average 10.3 percent and became among the fastest economic growing countries in the world, its economy still suffers public-centered mentality, he said.

He said that for the consistent continuity of the country economic development, it should totally shift from public-centered mentality to private sector mentality and for proper implementation, it needs structural reforms on government institutions. He indicated that the current government structural procedure needs reform to enhance competency between institutions.

According to Dr. Tilaye under developed private sector, political disruptions, continuous corruption, government investment dominance and bilateral relation focusing mainly with single government are among the key economic threats for the country's economy. To keep its current economic growth the country should give attention for the private sector.

He further stated that to encourage the private sector, there should be clearly defined system and the current reform process must be executed properly and become participatory with defined structures.

Amin Abdela, Institution Trade and Industry Head with Ethiopian Economic Policy Research on his part argued that unclear and unpredictable private sector role, expanding contraband, informality dominated urban sector and subsistent dominant rural sector are the threats for the economy.

He argued that to ensure continuous economic development, the role of private and public sectors should clearly define. He also added that the tax administration system also needs adjustment. Tesfaye Mergiya, Tax Administration MATATAM and Regions Support Director with Revenue and Costumes Authority also stated that there must be healthy taxation law and administrative systems for the healthy economy.

Million Bogale, investor and President of Ethiopian Pulses, Oilseeds and Spices Suppliers and Exporters' Association on his part said that to balance the import and export trade the country should create competitive agricultural sector. He said that transforming the agriculture needs private sector involvement and for effective implementation there should be legal framework to create linkage between owners of land (farmers) and investors (owners of modern mechanization system).

All experts said that government should play supervisory role and stick only on facilitating suitable environment for the private sector than controlling the economy.

Eyob added that currently the economy needs serious solution and revolutionary reform and government is taking meaningful measures to transform the economy.

The commissioner stated that all ideas and suggestions have to raise at this time and economic advisory council will be established by the government to adjust all necessary measurements.

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