Why opt for Industrial Parks when investing in Ethiopia?

If you are a part of the manufacturing industry, then chances are you are in the least aware of special industrial and economic zones or industrial parks in one form or another. Investopedia generally defines them as a portion of a city that is zoned for industrial use rather than residential or commercial needs. 

An industrial park in the Ethiopian sense is a distinct area set apart for the purpose of developing a group of similar or varied environmentally friendly industries. These parks have the necessary infrastructures, services and utilities needed for running and sustaining these industries.

Moreover, Industrial parks also provide special incentive programmes for their tenants. The parks developed both by the Ethiopian government and other private developers are labelled as such by the Ethiopian Investment Board which is led by the Prime minister. (see full definition in the industrial park proclamation number 86/2005).

Most parks in relation to the Ethiopian Investment Board’s decision promote export and allow companies that export most, if not all of their products (especially those involved in the manufacturing of textile and garments). While some engage in import substitution for products that are much needed within the country.

Hence, if your planned investment is a large scale manufacturing project, then industrial parks are the fastest option to obtaining land and/or manufacturing sheds, and starting production as soon as possible.

But what are the specific features that make Industrial Parks your best option?

  • Their location along strategic economic corridors and their connection to ports by electric driven railway lines and asphalt roads makes them favorable.
  • Their nearness to abundant labor force.
  • Ready for plug-and-play. Equipped with all the necessary infrastructures including wastewater treatment plants.
  • Dedicated power with their own sub-station and waste treatment facilities.
  • Also have Health stations, fire brigade, expat accommodations and 24 hours security services.
  • In addition, they also have One Stop Shop Services (OSS). OSS includes most services given by the government including processing & issuance of permits, licenses, registration certificates, agreements, tax identification number, customs clearance, banking services.

And this begs the question; what kind of industries are do these parks allow?

With a few exceptions, a lot of industrial parks specialize in specific sectors and therefore require enterprises that operate in and around those specifications.

Listed below are the areas of investment that have been identified as priority sectors by the Ethiopian government:

  • Agro-Processing industries
  • Textile and garment
  • Leather and leather products industries
  • Sugar and related industry
  • Chemical industries
  • Pharmaceutical  industries
  • Metal and engineering industries

Moreover, due to the high demand for land and manufacturing sheds within these parks, priority is given to companies who plan large scale investments and on exporting their products. Also, companies which provide employment opportunities for thousands of locals are prioritized.

Who are the major industrial parks and what do they specialize in?

Below you’ll find a list of the industrial parks, their specialization as well as who owns them. The special incentives you’ll receive and the procedures of developing your own industrial park will be looked at as we dig deep into an investment’s life-cycle in Ethiopia.

List of Industrial Parks in Ethiopia

Parks Owned by the Federal Government

  • Hawassa IP
  • Bole Lemi IP
  • Mekelle IP
  • Kombolcha IP
  • Adama IP
  • Jimma IP
  • Debre Berhan IP
  • Bahr Dar IP
  • Dire Dawa IP

Parks owned by Private Developers

  • Hua Jian Light Industries City IP
  • George Shoe IP
  • Eastern IP
  • Vogue IP

Parks owned by the Regional Governments

  • Baeker Agro IP
  • Bure Agro IP
  • Bulbula Agro IP
  • Yirgalem Agro IP

Table of Contents