Industrial parks the way to go
President Mnangagwa’s tour of Bole Lemi brought to light lessons for Zimbabwe, which is in the midst of implementing a cocktail of economic turnaround strategies informed by the need to create employment, generate foreign currency and attract foreign investors who bring latest technologies and impart to locals modern management techniques.
ON FEBRUARY 11, President Mnangagwa and his delegation to the 32nd Ordinary Session of the African Union Assembly headed for Bole Lemi, in Addis Ababa, Ethiopia.
At the AU headquarters, the sum- mit of Heads of State and Government was winding up.
The President assigned Foreign Affairs and International Trade Minister Dr Sibusiso Moyo to attend in his stead as we wove our way down the road to Bole Lemi Industrial Park.
The Ethiopia of yesterday is very dead! Crowding Addis Ababa’s skies are cranes, no matter which direction one looks, a sign of serious economic activity underway catalysed by nothing but victory of economics over politics.
Ethiopians have embraced the concept of industrial parks to fasttrack industrialisation of an economy long agrarian.
The visit to Bole Lemi by President Mnangagwa and his delegation became a practical case study on how others agrarian are leapfrogging their economies.
The President and his delegation toured Jay Jay Textiles and Ashton Apparel Manufacturing PLC.
As an industrial park, Bole Lemi is a massive complex of textile factories.
The factories house foreign investors from countries including India and the United Arab Emirates (UAE) who have brought in state-of-the-art machinery.
Jay Jay Textiles employs 4 000 Ethiopians. The majority of them are young women. Busy as bees they go about their daily chores as if choreographed. Management at Jay Jay Textiles briefed President Mnangagwa that the firm exports clothes to top American shops.
Three critical aspects emerged from the tour — employment creation, foreign currency generation via exports and technology transfer!
This is what Ethiopia is doing and explains why it intends to construct 30 industrial parks across the country by next year.
Active in the construction of the industrial parks are giant Chinese companies. Of note is that the industrial parks that Ethiopia is constructing on a massive scale are specialised and export-driven factories.
Specialised in that for example while the Bole Lemi industrial Park focuses on textiles, another industrial park in Kilinto produces medicines and high-tech-medical and pharmaceutical products.
Ethiopia’s biggest industrial park — Hawassa — employs 10 000 people (the majority of them women) and 60 000 Ethiopians once complete.
The largest tenant at Hawassa is PHV, which is the American owner of brands like Calvin Klein and Tommy Hilfiger — in comes again the issue of transfer of latest technologies and production of global brands on African soil.
President Mnangagwa’s tour of Bole Lemi brought to light lessons for Zimbabwe, which is in the midst of implementing a cocktail of economic turnaround strategies informed by the need to create employment, generate foreign currency and attract foreign investors who bring latest technologies and impart to locals modern management techniques.
What does it take to implement concepts like industrial parks the Ethiopian way? Research points to Government commitment.
The United Nations Industrial Development Organisation (UNIDO) in its study of Ethiopia’s industrial parks notes that such concepts are dead without Government commitment and support.
This is largely because establishment of industrial parks may not be profitable in the short term and the private sector is hesitant going it alone.
“The implication is that Government should take the lead in the development of industrial parks… Government should be proactive and assume a leading role in the development of the industrial parks.
The role of government will of course change overtime with greater role at the early stages and lesser role later on as the industry matures…” notes UNIDO in its 2018 report on the study of Ethiopia’s parks.
To show its commitment to the establishment of industrial parks, the Ethiopian Government built the Bole Lemi industrial park through its company Industrial Parks Development Corporation (IPDC). In fact, Governments have many roles to play in the establishment of industrial parks from a political and legal perspective.
From a political viewpoint, Government may deliberately involve another country which boasts either a financial or technological muscle. In the case of China, it roped in Singapore after measuring its technological superiority.
Zimbabwe has an easy starting point — zoning its economy. What resources do we have say in the Midlands Province that can enable establishment of an industrial park there?
They stretch from cotton, gold, and chrome, to iron ore.
This must inform Government on what kind of industrial parks to establish there. The same applies to Manicaland Province — which boasts diamonds, timber, coffee, macadamia nuts plantations.
Ministers of State for Provincial Affairs can play a key role by identifying opportunities in their respective areas.
Resource availability defines the nature of the industrial parks.
Look at the potential of Gokwe as a cotton-growing hub. There is great potential for the establishment of textile related industrial parks in the same way our tobacco growing region could be beneficiate the product in situ (province of origin). Implementation of such concepts help in the fulfilment of the Zanu-PF administration’s electoral promise — job creation through industrialisation, attraction of foreign investors and foreign currency, among other socio-economic fundamentals.
President Mnangagwa is in agreement with creation of such models as industrial parks as captured in his remarks after touring Jay Jay Textiles at the Bole Lemi Industrial Park on February 11, 2019.
“The history is that the Government of the Federal Republic of Ethiopia built these factory shells and then invited companies in the textile sector from India to come and do business here. This entity alone (Jay Jay Textiles) employs in excess of 4 000 workers but they have other places where they have similar factories having 45 000 employees in the past five years working in these shells built by the Government.
“This is the way to go. They have created employment for the youths and particularly women. You can see inside there that the young girls and women are working. The market, we have been briefed, are top end market in the USA. It creates employment. It brings technology. It brings you skills into the country. This is the way to go,” he said.