Chinese firm signs agreement to manage Ethiopian industrial park

Huajian, a Chinese shoe producing company signed an agreement on Thursday to manage and operate Ethiopia's Jimma Industrial Park (JIP).

The agreement signed between Zhang Huarong, President of Huajian Group and Lelise Neme, CEO of Ethiopia Industry Park Development Corporation will see Huajian invest up to 100 million U.S. dollars to construct shoe manufacturing plants and coffee processing plants.

Jimma city and its surroundings, which are known as the major source of Ethiopia's major export commodity coffee, are considered as an integral part of Ethiopia's recently improved export sector, in which the now-operational high-quality road infrastructure is expected to spur the chain of coffee trading in Ethiopia.

Zhang said Huajian has been investing in Ethiopia's budding manufacturing sector for the last eight years and the latest agreement aims to further boost the firm's business presence in Ethiopia.

"Huajian plans to persuade fellow Chinese firms to set up plant in Jimma Industrial Park, in addition to its own anticipated investment in the industrial park," he said.

"Huajian also plans to set up coffee processing plant in collaboration with other firms within the perimeters of JIP, with a view to eventually exporting coffee products to China," he said.

Zhang said the industrial and agricultural products produced in JIP won't be restricted to being sold in foreign markets, with the local consumer market also eyed as an additional market.

"Huajian has invested in Ethiopia for the long term, abiding by local rules and regulation, engaging in transparent business practices and is committed to helping Ethiopia achieve its export ambitions," he said.

Huajian entered Ethiopia's manufacturing industry in 2011, when Ethiopia's first 40-hectare Eastern Industrial Zone went operational with Chinese investment.

Huajian in August 2016 opened another factory in Ethiopia in its own industrial park on the outskirts of the capital. Its two factories jointly provide direct jobs to more than 7,000 Ethiopians.

Every year in the two factories, about 5 million pairs of shoes labeled "Made in Ethiopia" are shipped to the United States and European markets, fetching some 31 million U.S. dollars for the East African nation in foreign exchange earnings in 2017.

Neme said the agreement with Huajian Group to manage and operate JIP, is expected to create up to 15,000 jobs for the locals.

"The beginning of operations of JIP in general is expected to boost economic activities in western Ethiopia, significantly boosting Ethiopia's already growing economy," said Neme.

The Ethiopia Industry Park Development Corporation currently manages 12 industrial parks, out of which seven including Jimma Industrial Park are currently operational.

Jimma Industrial Park, built by China Communications Construction Company was inaugurated in December 2018 by Ethiopian Prime Minister Abiy Ahmed.

Stretched on 75 hectares of land, with an ambition to attract foreign investors in Ethiopia's agro-processing sector, the industry park hosts nine manufacturing sheds.

The construction of industrial parks are part of the Ethiopian government's grand plan to transform the country's largely agrarian economy into an industrialized one by 2025.