Urbanization and Industrial Development in Ethiopia

Ethiopia is one of the least urbanized countries in Africa; only 20 per cent of the population reside in cities. Over the next twenty years, urbanization will double. The government plans to transform Ethiopia into a middle-income country by 2025 and industrialization has been prioritized to promote economic growth and job creation. Twin pressures of rapid urbanization and high population growth warrant decisive government measures to manage urbanization. To this end, the government is establishing industrial parks (IPs) in selected cities, signifying the close relationship between urbanization and industrialization through urban plans, infrastructure development, and regional service centres, to strengthen rural–urban linkages. Yet several barriers constrain Ethiopian cities from playing an enabling role in industrialization. Ethiopia must therefore strengthen the efficiency, competitiveness, and productivity of its urban centres to become centres of innovation, economic accumulation, and exchange.