Eco-friendly and Sustainable Industrialization in Ethiopia

Written By: Alex Wang

The United Nations Industrial Development Organization (UNIDO) classifies the global economy into either industrialized economies or developing/emerging economies. This classification is further divided into other groups such as emerging industrialized economies, least developed countries (LDCs), and more, all based on a specific country's manufacturing value-added or MVA.1 As the global economy grows, we can see that Africa continues to fall behind as, far and away, the world’s least industrialized region. South Africa is the sole “industrialized” nation on the continent. With this in mind, we see Africa’s rapid industrialization on the horizon, with an estimated 100 million jobs migrating from China, as the manufacturing hub, to Africa over the next decade.3 Of seminal importance is the sustainability of this development, economically to improve the living standards, but not at the cost of the environment. Ethiopia’s successful tackling of this eco-friendly industrialization can serve as a paradigm for its African neighbors, but it is not without its share of growing pains. 


Industrial parks, a type of development in which a specified area is zoned intentionally for the sole purpose of industry, are a key part of Ethiopia’s transition into the industrialized global economy. The one recently completed is in the city of Hawassa, a 1.3 million sq ft facility; it bears advanced facilities and new energy management technologies. The Hawassa facility aims to create 50-60,000 new jobs in Ethiopia’s booming textile industry and eventually generate export revenue upwards of a billion dollars.2 Significant investment from tens of global companies, especially in beginning production, has only furthered its growth. 


Beyond just offering economic benefits, it further follows the Zero Liquid Discharge Program, an initiative that requires that 85% of the sewerage disposal water is recycled (2). This implementation has been pivotal in shifting the identity of Hawassa, which just a couple of years ago was notorious for its continual chemical dumping into local waterways. Environmental effects were as follows: watercolor changes to blue/black, a strong odor, higher water temperatures, and destruction of fish habitats.2


Technological advancements and investment in green research & development (R&D) are a core part of making sustainable growth possible. However, this is an area where Ethiopia struggles as its current reliance on global investment may not be sustainable moving forward. On average, 21% of firms in the sectors such as textiles, leather, and more, report process innovation, though this may be true, only a tiny fraction of those report innovation to reduce energy consumption or to reduce material waste on the order of magnitude of 3-6%.4 This is due to the fact that government environmental regulation is not one of the drivers of innovation. Improved enforcement to stimulate these green innovations seems necessary as competitiveness in the market is the primary driver, and government regulation can level the playing field.4 


Looking forward, lowering the barrier to innovation could be achieved through better integration of research and higher education sources. As most sectors currently rely on conferences, exhibitions, and fairs for innovation and product development, better connecting industry and education is a worthy cause. Government financing of R&D is another necessary pathway forward, and better connections between the government and industry are also vital for more vigorous green enforcement. Though Ethiopia does have steps to improve, its clear role as a flagship African leader in sustainable economic development most definitely deserves praise. 


  1. Antonio Andreoni and Shyam Upadhyaya (2014) Growth and distribution pattern of the world manufacturing output: A statistical profile, UNIDO working paper 2/2014

  2. Donaldson, Tara. “Ethiopia Opens Eco-Friendly Industrial Park for Textile Production.” Sourcing Journal, Sourcing Journal, 18 July 2016, https://sourcingjournal.com/topics/sustainability/ethiopia-opens-eco-friendly-industrial-park-textile-production-td-49696/

  3. Hai, Helen. “Making Industrialization in Africa Sustainable.” United Nations, United Nations, 1 Dec. 2020, www.un.org/en/un-chronicle/making-industrialization-africa-sustainable 

  4. Wakeford, Jeremy J., et al. “Innovation for Green Industrialisation: An Empirical Assessment of Innovation in Ethiopia’s Cement, Leather and Textile Sectors.” Journal of Cleaner Production, vol. 166, Elsevier BV, Nov. 2017, pp. 503–511. Crossref, doi:10.1016/j.jclepro.2017.08.067

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