The Government and the Development Assistance Group (DAG) discussed trade logistics and export performance at the 16th High-Level Forum chaired by State Minister H.E. Ahmed Shide on Tuesday 17 June. Presentations were made by State Minister of Trade H.E. Yaekob Yalla; Ato Mekonnen Abera, Director General of the Maritime Affairs Authority; and Mr. Guang Chen, DAG co-chair and Country Director of the World Bank. The discussion covered the various successes that have come with Ethiopia’s high growth trajectory, as well as the remaining actions required to overcome logistics constraints and declining export performance in Ethiopia.
The Forum was successful in bringing Government and the DAG Heads of Agency to agree on concrete recommendations to take forward. To improve trade logistics, these include providing high-level leadership and intergovernmental coordination to enhance the transparency and predictability of regulations, as well as stepping-up consultations with the business community. As part of the Government’s forthcoming National Logistics Strategy, Government and partners agreed to work together to reduce the time and cost to freight goods and set ambitious targets for the next GTP. They also agreed to reform customs procedures with new technologies and through PPPs. Government said they would further reflect on developing multiple corridors and strengthening the multimodal system by encouraging increased competition.
To improve Ethiopia’s export competitiveness, Government and partners agreed to ease binding constraints related to a reliable power supply, credit and foreign exchange. Revising burdensome business regulations that obstruct firm entry, especially high start-up capital requirements and pre-registration of bank deposits would also be addressed. Government and partners together agreed to step up the productivity in export sectors through technological upgrading, skills development, and the development of industrial zones that conform to international best practice. The recommendation to ensure a more flexible exchange rate to support export competitiveness has to be considered more carefully by Government, including by looking at the wider macroeconomic implications on the economy.