By Yetenayet Kebede, Ezega News
Addis Ababa, March 18, 2010 (Ezega.com) -- The Ethiopian Investment Agency on Wednesday said lack of nationwide mechanisms on investment promotion, attraction and protection is impeding its role of attracting investment projects as envisaged in the five years strategic plan.
In his five year performance report presented to the Trade and Industry Standing Committee of the House of People’s Representatives, Agency Director Geneal, Abi Wolde-Meskel, said the agency’s activities have also been impacted by absence of coordination between the pertinent government organs.
According to the ten page report the agency has not established ways of gathering documenting and disseminating timely information on investment that can satisfy the demands of its customers.
Evaluation and support systems that help gauge performance of ongoing projects, as well as ways to identify shortcomings and provide nationwide solutions have not been realized. According to the Director General, this has put obstacles to assist investors enter the production and construction level with required number and speed.
Investment lands that are provided with the necessary infrastructure have not been clearly identified and reserved in several urban and regional centers creating huge impediments on the execution of investment projects.
The report also stated shortage of budget, infrastructure and friendly offices coupled with acute shortage of manpower have contributed to the agency’s shortcomings.
The agency’s plan to automate its service has not been realized due to absence of the anticipated loan funding from the World Bank.
Though the agency managed to establish Foreign Investment Promotion Council comprising senior government officials as well as foreign and local investors so as to promote and encourage investment activities in high priority sectors, the initiative has been cut short.
On the other hand the agency has licensed more than 11,000 foreign and domestic investors with an aggregate capital of 423 billion Birr in the stated period. Some 6,255 of the projects worth over 295 billion Birr are owned by foreigners.
Some 18 percent of the licensed projects have entered construction and production, creating over 130,000 jobs, the report indicated. After becoming fully operational, the projects are expected to create two million more jobs.
According to the Director General, textile, leather and leather products projects have shown remarkable performance owing to the attention given to these sectors in the industrial development strategy of the government.
Furthermore, the Director General said the agency has managed to provide more than 3,274 investors with various assistance and solutions especially with regard to land, bank loan, infrastructures and incentives.
The agency has accomplished 146 percent of its plan promoting various investment projects in the country. As a result, Abi said the share of domestic investment has increased to 26.1 percent from 20.5 percent five years before.
The agency had planned to use 13.42 million birr budget in its five-year plan. However, at the end of the five years, it consumed over 21 million birr.
The agency with its strategic plan had envisaged registering a 93 percent performance, Abi recalled.