Ethiopia Green Industrialization Support program

Project Summary:

The objective of this grant is to support the Government of Ethiopia achieve its green industrialization agenda by providing the analysis and information to enable prioritization, targeted interventions and policy implementation. Climate change and green growth are top priorities for Ethiopia. The Government of Ethiopia (GoE)’s vision is to turn Ethiopia into a Middle Income Country by 2025 and to establish the country as a light manufacturing hub in Africa over the next 10 years. This KGGTF program will complement and inform existing World Bank programs on industrialization by assisting Ethiopia to pursue sustainable industrialization, with the objective of energy and resource savings as well as environmental pollution abatement. The grant will fund four integrated activities beginning with a green competitiveness analysis of key industries, based on which a tailored set of green competitiveness evaluation analysis indicators will be developed. The performance of these industries will then be benchmarked against regional competitors for green competitiveness. A review of the current industrial park framework will identify gaps and opportunities to scale green industrialization.  Based on this analysis a green industrialization strategy will be developed to support the GoE’s Climate Resilience and Growth Strategy for Ethiopia’s main competitive sectors.

List of Activities:

1. Green competitiveness analysis - Number of firms that prioritized their particular products’ green supply chain in accordance with the study results
2. Green competitiveness benchmarking - Policy, regulatory improvement to ensure future growth of the key sectors
3. Reviewing current industrial park framework - Number of recommendations implemented at new zone development with regard to waste, water and sanitation management
4. Development of green industrialization strategy - Number of recommended articles included in GoE’s green industrialization strategy

Outcomes:

Output 1:

• Green competitiveness analysis of the textile, footwear and pharmaceutical sectors and their forefront products 

Output 2:

• Report on current economic performance of select industries and comparison to regional competitors
• Outline policy, regulatory and infrastructure requirements to ensure future growth of the key sectors 

Output 3:

• Sustainability analysis reports of Bole Lemi I and II

Output 4:

• Strategy paper on green industrialization in Ethiopia

Outcomes:

• Improved efficiency: Climate efficient industrial park design as well as debottlenecking practices that will physically serve to integrated management in waste, water, energy and sanitation sectors will upscale resource efficiency and will improve efficiency in manufacturing. All these efforts will end up with GHG abatement, water efficiency, local pollution reduction, community’s health improvement as its spillover impact.
• Greater resilience: Although Ethiopia has relatively abundant water resources, it is considered ‘water stressed’ due to rapid population growth over the last decade. Estimates of renewable annual groundwater per year range from 13.5 to 28 billion m³, of which only about 2.6 billion m³ are currently exploitable. Natural variability in rainfall patterns and distribution, punctuated by extreme climatic events, has thrust many regions of the country into conditions of extreme water scarcity, degraded water quality. Industry supplies its process water needs through wells. Ethiopia is moving though industrialization path ambitiously and water scarcity appears to be a critical issue for the quality of water intensive sectors such as textile. The project will strategize water management to overcome challenges pertaining to water stress and quality. Integrated water resources management in industry will increase the resilience.
• Increased competitiveness: The project will add value on adaptation of institutional strategies / action plans to promote green competitiveness of forefront sectors and their selected products. From a broader perspective, replication of the green growth strategy at sector and zone levels together with leveraged public private dialogues will increase the attractiveness of adaptation/mitigation projects and zones to new tenants and global buyers, who would benefit from having resilient infrastructural services and green manufacturing operations. This will increase industrial competitiveness broadly across different industries.

Collaboration with K-Partners and Others:

• Global Green Growth Institute (GGGI)
• Korea Energy Agency
• DOHWA Engineering Co. Ltd
• USAID
• UNIDO