Unnecessary Bureaucracy, Lack of Interest Limiting Private Sector’s Contribution in Economy

Addis Ababa The contribution of the private sector in Ethiopia's economic growth is said to be limited due to its low development.

Some attributed this to weak institutional frameworks and unnecessary bureaucracy, while others blame the private sector itself for lacking interest to build capacity.

Secretary-General of the Ethiopian Chamber of Commerce and Sectoral Associations, Endalkachew Sime told ENA that the development of private sector in Ethiopia is hampered by weak institutional frameworks.

The private sector faces many challenges associated with issue such as business environment, poor governance, corruption and limited access to finance, he pointed out.

As a result, the private sector has not developed its capacity, which in return limited its contribution to the national economy.

The private sector can't grow without the support of the government, he said and added that the government has to provide clear role for the private sector to where it stands as far as economic development is concerned.

According to the Secretary-General, The major responsibility to develop the private sector lies on the government; that is directly related to the government's service provision; that provides us a developed private sector,, he said.

He noted that the government needs to properly implement servicees that would facilitate the service provision such as single window service, and work in collaboration with the private sector to fill the gap in capacity.

For Ashenafi Mered, Secretary-General of Ethiopian Sectoral Association, it is the private sector that prohibited its development.

He said that the actors lack readiness to expand institutional capacity and become competent.

When we say the private sector must be competent and modernized, the initiative is not only expected from the government but the private sector should also be ready and gear towards that, he said.

Ashenafi said the sector characterized by lack of expertise skill at the leadership as most of the private companies in the country are run by owners of the companies, not by professionals.

This has negatively influenced the capacity and competency of the private sector, which in return affected its contribution to the economic development, he said.

To improve its capacity and competence, Ashenafi urged actors in the sector to encourage professionalism.

Source: Ethiopian News Agency