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The Infrastructure Industry in Ethiopia Updated Report Available
BY Martin Rothschild
Ethiopia
18 September 2015
R 2 040.00 (ZAR)  
estimated $ 143.17 (USD) *
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The Ethiopian Construction Industry


The Ethiopian construction industry is benefitting from the massive levels of growth the country has experienced over the last decade. During this period, economic growth averaged 10.7%, which is more than double the yearly average 5.2% growth rate of sub-Saharan Africa. The construction sector is expected to experience 36.4% annual growth and contribute 7.6% or US$4.723bn to national GDP of US$55.75bn in the 2015 financial year. It is because of these figures that the International Monetary Fund (IMF) rated Ethiopia as one of the top five growing economies in the world.


Opportunities


The Ethiopian construction sector has benefitted from the government’s Growth and Transformation Plan (GTP), now in its second phase and extended until 2020, positive trade relations with China and large-scale investments from that country. Chinese contractors have helped local Ethiopian firms by training them, bringing them in to assist on large-scale projects, and showing them how to manage projects more effectively. Government’s intention of spending an average 10% of its GDP on infrastructure each year for the next ten years is a further boost and presents opportunities for companies of all sizes operating within the construction sector.


Report Coverage


This report on the construction industry in Ethiopia focuses on conditions in the local sector as well as market opportunities for companies in all the sectors of the economy. It investigates government initiatives as well as recent developments and factors influencing the success of the sector. The report also profiles 14 foreign and local construction companies, ranging from global giant, state-owned China Road & Bridge Corporation (CRBC) which employs 1,500 people in Ethiopia alone, to local micro-enterprise, Alemayehu Ketema General Contractor t/a AKGC, which focuses on the construction of road and waterworks and has seven permanent employees.


Page
1. INTRODUCTION 1
2. SIZE AND STRUCTURE OF THE INDUSTRY 1
2.1. Geographic Position 1
2.2. Key Cities and Regions 2
2.3. Size of the Industry 3
2.3.1. Key Indigenous and Foreign Players 3
3. STATE OF THE INDUSTRY 8
3.1. Local 8
3.1.1. Corporate Actions 9
3.1.2. Regulations 10
3.1.3. Market Opportunities and Challenges per Sector 11
3.1.3.1. Transport 12
3.1.3.2. Energy/Power 15
3.1.3.3. Water Supply and Treatment 18
3.1.3.4. Healthcare 20
3.1.3.5. Education 22
3.1.3.6. Telecommunications 23
3.1.3.7. Residential Building 24
3.1.3.8. Commercial 25
3.1.3.9. Retail 26
3.1.3.10. Hotels and Tourism 27
3.1.3.11. Mining and Industrial 27
3.2. Continental 31
3.3. International 35
4. INFLUENCING FACTORS 37
4.1. Economic Environment 37
4.1.1. Effects on the Construction Sector 38
4.2. Socio-Political Environment 39
4.3. Infrastructure Deficit 41
4.3.1. Government Infrastructure Programme Spend 41
4.3.2. Foreign Direct Investment (FDI) 41
4.3.3. Private Sector Investment 41
4.4. Urbanisation 42
4.5. Local Content 43
4.6. Corruption 43
4.7. Industry Supply Chain 44
4.7.1. Capacity, Quality and Security of Supply 44
4.8. Industry Specific Issues 45
4.8.1. General Trends 45
4.8.2. Input Costs 46
4.8.3. Cyclicality 46
4.8.4. Health and Safety 47
4.9. COMPETITION 47
4.9.1. Barriers to Entry 47
4.9.2. Public Procurement and the Tendering Process 48
4.10. Labour Resources 48
4.10.1. Training and Skills Development 48
4.10.2. Licensing 49
4.10.3. Skills Shortages 49
4.10.4. Opportunities for Foreign Professionals 50
4.10.5. Technology, Research and Development (R&D) and Innovation 50
4.11. Environmental Concerns 51
5. SWOT ANALYSIS 52
6. OUTLOOK 54
6.1. Construction Industry Forecast 54
6.2. Macroeconomic Outlook 54
6.3. Political Outlook 54
7. INDUSTRY ASSOCIATIONS 55
8. REFERENCES 56
8.1. Publications 56
8.2. Websites 56
COMPANY PROFILES 58
AFRO-TSION CONSTRUCTION PLC 58
ALEMAYEHU KETEMA GENERAL CONTRACTOR 60
CAMPBELL PROJECT MANAGEMENT SERVICES (ETHIOPIA) PLC 62
CHINA ROAD & BRIDGE CORPORATION 64
CONSOLIDATED CONTRACTORS COMPANY 66
FLINTSTONE ENGINEERING 69
HABESHA CONSTRUCTION MATERIALS & DEVELOPMENT SC 72
HELA CONSTRUCTION PLC 74
RAMA CONSTRUCTION PLC 76
SUNSHINE CONSTRUCTION PVT LTD 78
SUR CONSTRUCTION PLC 80
TEKLEBERHAN AMBAYE CONSTRUCTION PLC 83
UNIVERSAL CONSTRUCTION PVT LTD 85