Ethiopia Is Learning The Past Development Model Of China?

"For a long time, China has been an important development partner of Ethiopia.

We are moving forward from agriculture to industrialization and look forward to strengthening cooperation with China in the field of productivity. "

Mesfin, Ambassador of Ethiopia, emphasized that such cooperation is a win-win situation. On the one hand, it promotes the growth of Ethiopia and increases employment, and on the other hand, it pfers the surplus capacity of China.

 

When it comes to Ethiopia, many people still remember the famine, the heat and the mess.

But you may not be aware that over the past 12 years, the Ethiopia economy has grown by more than 11% per year and has become the fastest growing economy in the world.

Investment drive, infrastructure construction, establishment of special economic zones and investment promotion.

Today Ethiopia is learning about the past development pattern of China.

I thought there would be some negative answer, but it was surprising that Seyoum Mesfin Gebredingle, a Chinese ambassador, told Seyoum Mesfin in twenty-first Century that "we are eager to develop and our country needs to change."

China has lifted 600 million people out of poverty in 30 years to prove the success of this model.

Besides China, who else can we learn from? "

He stressed that China's assistance to Ethiopia is enormous, not only by greatly improving the "hardware conditions" through building bridges and paving, but also by building industrial parks and industrial parks to form the industrial agglomeration effect. It also provides technical support and personnel training to local authorities, introduces the experience of the development of the special economic zones in China, and promotes the "software conditions".

"In many ways, China and Ethiopia are examples of Sino African cooperation.

We are willing to share experiences with African brothers and achieve common growth through the "China model".

Mesfin said.

"If we want to be rich, we should first build roads."

Ethiopia is a closed inland country. It does not go to the sea, but often lacks water and electricity.

Since the 90s of last century, China began to invest more in Ethiopia's infrastructure.

By the end of 2013, China's stock of direct investment in Ethiopia reached US $720 million, and the total amount of contracted projects signed by Chinese enterprises was US $22 billion 400 million, and the total amount of projects under construction was over US $15 billion.

China has been the largest trading partner of Ethiopia for many years, the most important source of foreign investment and the contractor of the project.

China's then ambassador to Ethiopia, Xie Xiaoyan, wrote in 2014 that more than 90% of the highway, communications network, the first railway and urban light rail, the first wind farm and several important hydropower stations were built or commissioned by Chinese enterprises.

Mesfin disclosed that most of the projects currently involved in China's enterprises adopt the EPC mode, and the Ethiopian government will gradually increase the BOT and PPP projects.

At present, the most anticipated infrastructure project is the electrified railway which is 850 km long from the capital of Ethiopia to Addisababa and Djibouti, capital of Djibouti.

"Before June this year, we will open a ceremony for the railway, and senior officials from both countries will attend."

Mesfin said.

This is the first pnational Railway built by Chinese enterprises in Africa in the new historical period of Sino African cooperation.

A representative of Chinese enterprises planting vegetables in Ethiopia told the twenty-first Century business news reporter that it now takes five or six days to pport from Addisababa to Djibouti by road. After the railway is opened, the time will be shortened to seven or eight hours.

This is good news for fresh agricultural products.

In order to enhance the profitability of the line, according to Mifen, the two governments have decided to start construction of several industrial parks along the line immediately after opening to traffic.

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In addition, as a net importer of crude oil, Ethiopia has also been faced with the problem of energy supply.

At present, a joint venture between Poly Group and Xin Xin group is investing in the development of the Ethiopian Djibouti petroleum and natural gas project.

The whole project consists of four parts, namely, Ethiopia oil and gas exploration and development, pipeline laying, Djibouti LNG plant and wharf construction. The oil and gas are pported back to China through pipelines from Ethiopia to Djibouti after liquefaction.

The project includes 2 development blocks and 8 exploration blocks, with a total area of nearly 120 thousand square kilometers and a contract term of 43 years.

It is estimated that the large recoverable reserves of natural gas in the development blocks will help our country to diversify its energy supply.

The project is expected to start at the end of 2016 and will be put into operation in early 2019.

Industrialization construction in full swing

"For a long time, China has been an important development partner in Ethiopia.

We are moving forward from the agricultural economy to industrialization, and we look forward to strengthening cooperation with China in the field of productivity. "

Mesfin stressed that such cooperation is a win-win situation, on the one hand, to promote Ethiopia growth and increase employment, and on the other hand, to pfer China's excess capacity.

"Thanks to our early pfer of some industries to Ethiopia, it would be a great shock."

Li Weimin, President of Huajian group, told reporters on twenty-first Century economic report.

His company is mainly in the production of high and high grade leather shoes, and its headquarters is in Dongguan.

In November 2011, Huajian began to build a new production base in the Eastern Industrial Park of Ethiopia.

"At first, many people objected to going all the way to the construction of Ethiopia.

In fact, until 2012, the domestic market was very good. We also paid 2 hundred million of the tax in China.

I didn't expect that the situation in 2013 was going downhill.

Li Weimin pointed out that the "migratory bird industry" such as shoemaking is highly sensitive to labor cost, and now the labor-intensive industry in China is basically over.

He counted the accounts for journalists. Now, the wage cost of domestic workers is 2000-3000 yuan, and the local cost is only 300-500 yuan.

Ethiopia's weekdays are six days, eight hours, and national holidays 13 days.

Average overtime is calculated by 1.25 times, overtime is 1.5 times during the night, overtime is calculated by 2 times on Sunday, and overtime is 2.5 times.

In terms of welfare expenditure, the current mandatory provision is old-age insurance, and the company takes part in the calculation of basic wages.

In terms of Taxation, Ethiopia is also very attractive to local enterprises exporting to Europe and the United States, enjoying the African Growth and opportunity policy and the EU's "comprehensive preferential weapons arrangement", which can be exempt from customs duties and quotas.

"If we import our shoes from China, we have to pay 37% of the customs duties, and import tariffs from Ethiopia."

Now, Huajian has 4200 employees and 6 production lines in Ethiopia.

Factory, annual export

Up to 2 million 400 thousand pairs, the average profit margin was 10%, and in 2015, it created a profit of 15 million yuan.

Li Weimin said.

To further expand the industry, Huajian plans to build an industrial park in Addisababa.

Shoes, hats, electronics and other light industries are the main manufacturing industries.

Li Weimin said, "a total investment of 400 million dollars, the end of 2016 can be built the first phase of 80 thousand square meters of plant.

The project will be completed in 2020. "