Ethiopia Builds up Manufacturing Foundation to Become Africa’s Future Industrial Hub, Says US Analyst  

Addis Ababa, May 27, 2025 (ENA) - Ethiopia has been building up its manufacturing sector while currently registering remarkable progresses in this sphere of the economy, a renowned American Political-Economic analyst for Africa Lawrence Freeman told ENA.

On his part, Ethiopia’s Industry State Minister, Tarekegn Bululta underscored that significant reforms have been implemented aimed at stimulating the manufacturing sector.

These reforms include macroeconomic adjustments and policies focused on import substitution and export growth, the state minister said.

“The manufacturing is one of the critical sectors that will determine the future prosperity of Ethiopia. The sector is currently undergoing massive reforms. The government has already introduced new sound policies and procedures  and the sector has witnessed a transformation,´” Tarekegn stated.

 

The reformist leadership of the country has placed a strong emphasis on the industrial sector and is diligently striving to enhance the sector's competitiveness while fostering a more conducive environment for manufacturers; Tarekegn noted stating that significant results have been achieved over the last three years.

The American Analyst Lawrence Freeman who witnessed textile garment factories, steel complexes, sugar factories and other manufacturing sites, said Ethiopia is clearly making progress in the sector.

The new homegrown economic reform program for Ethiopia essentially makes the growth of the manufacturing sector one of its top priorities and is now delivering concert outcomes, he confirmed.

“I think this shows that Ethiopia has a commitment to build up its manufacturing base, which is essential for any economy to truly function…..,and this is very weak throughout Africa.  But Ethiopia is clearly trying to make progress in this area,” Freeman said.

 

The analyst added that he has observed an increase in the number of people employed in Ethiopia's manufacturing sector over the past few years.

He emphasized that producing tangible products is essential for economic expansion, stating that this is the direction Ethiopia is currently pursuing and should continue to pursue more vigorously.

 

“This is how the United States was built by emphasis on manufacturing. It's not replaceable by any other sector of the economy. So I'm very pleased and also to see the optimism that I've seen in all the factories that I've been at today.

There's a real optimism and enthusiasm growing in Ethiopia, and that, along with other accomplishments such as the GERD, Ethiopia is making progress, and that makes me happy to see Ethiopia make progress.”

Freeman argues that because of the colonial and neo colonial policy, Africa has a very tiny manufacturing sector in the Sub-Saharan base, and the contribution of manufactured goods in global trade by African nations is Very small.

For him, Ethiopia has a lot of light manufacturing by far, such as a textile industry.

Having confidence that manufacturing is the most important sector to achieve prosperity, Freman urged Ethiopia to further accelerate its transition in this regard.

Following the new policy reform introduced in the manufacturing sector, the production capacity of industries in Ethiopia has now jumped from 46 percent to 61.2 percent, Industry State Minister, Tarekegn Bululta revealed.

 

Acknowledging the current contribution of the sector to the Gross Domestic Product (GDP) stands at less than 6.8 percent, the state minister pointed out that concerted efforts are being exerted to boost this to 17.2 percent.

Tarekegn noted that the manufacturing sector has achieved a significant milestone in its import substitution strategy, generating goods valued at 3.1 billion USD during the first nine months of this fiscal year.