Economists Stress Need for More Involvement of Private Sector, Commend Privatization

Addis Ababa November 08/2018 Economic reform programs should seriously consider the involvement of the private sector in order to ensure stability and resilience of the economy, experts said. Approached by ENA to share their ideas about the economy, the professionals said a reform which ensures the effective participation of the private sector shares its burden of developing the country in many ways. They believe that improving the participation of the private sector would promote inclusive and sustained economic growth in the country. The economics lecturer at Addis Ababa University, Atlaw Alemu (PhD) said privatization has a positive impact on promoting foreign exchange earnings; but taking concrete measures in encouraging the private sector is imperative. “Transferring public owned businesses to the private sector is essential as it brings economic efficiency and rapid economic development,” he stressed. Atlaw, however, pointed out that the government needs to set controlling and monitoring mechanisms on privatized sectors. Fairfax International Company Chairperson, Zemedeneh Nigatu underscored the need for a strong strategy to draw the private sector into manufacturing. “We need to try to transfer some sectors to the private sector. We also need to further develop the infrastructure sector by involving the private sector. In general, we need to create a national wealth generated by a strong private sector,” he added. Planning and Development Deputy Commissioner Getachew Adem said performance review of the mid-term of 2nd GTP shows low engagement of the private sector, thus creating some limitations in the overall economic growth. “The government has been heavily investing in various sectors. But now we realized that we cannot create a sustainable economic growth only through this approach. So, we are inviting the private sector to become involved in huge investments,” he elaborated. According to Getachew, the government believes that engaging the private sector in the economy would help address the problem of shortage of foreign currency and improve efficiency. In this respect, the government is taking measures to help investors engage in huge public-owned companies. The reform will allow the economy to increase capital injection and create public-private partnership to create resilient economy that can curb inflation and solve other economic challenges, Getachew stated. Given the current pace of the country’s economic development, many economists believe that Ethiopia could attain its national vision of becoming a low middle income country by 2025.