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The Construction Industry in Ethiopia
BY Carole Veitch
Ethiopia
30 January 2018
R 10 080.00 (ZAR)  
estimated $ 731.44 (USD) *
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The Construction Industry in Ethiopia


This report examines the construction industry and infrastructure development in Africa’s second most populous country, the Federal Democratic Republic of Ethiopia. The Ethiopian construction industry is characterised by a large number of micro-entrepreneurs, the majority of whom operate in the country’s informal economy. Ethiopia’s formal construction sector comprises indigenous and indigenised firms, as well as numerous major foreign civil engineering and construction companies. Although all contractors are required to be registered with the Ethiopian Ministry of Urban Development and Construction, corruption as well as health and safety issues remain a matter of concern.


Investment into Infrastructure


During the past decade robust public and private expenditure on infrastructure and other construction works has served as a catalyst for Ethiopia’s rapid economic development. The country has consistently invested more than 30% of GDP into Gross Fixed Capital Formation (GFCF) expenditure since 2010 and as a result, Ethiopia has emerged as one of the fastest-growing economies in the world. The market value of the construction sector is currently estimated at more than US$7bn. According to the 2017 edition of African Economic Outlook, construction activities in Ethiopia accounted for 15.9% of GDP at current prices during the 2015/16 fiscal year.


Report Coverage


The Construction Industry in Ethiopia report focuses on conditions in the local sector and details current construction projects including the Grand Ethiopian Renaissance Dam, the largest project under construction in East Africa, with a value of approximately US$4.1bn. Key drivers of growth, current trends in the domestic sector and factors influencing the success of the industry are covered in this detailed report. Profiles for 19 companies are provided including state-owned company, Ethiopian Construction Works Corporation, which employs 15,000 people in Ethiopia and Rwanda. Also profiled are Chinese giants, China Civil Engineering Construction Corporation (CCECC) and China State Construction Engineering Corporation (CSCEC).


Page
1. INTRODUCTION 1
2. COUNTRY INFORMATION 1
2.1. Geographic Position 2
3. DESCRIPTION OF THE INDUSTRY 5
3.1. Industry Value Chain 6
4. SIZE OF THE INDUSTRY 8
5. STATE OF THE INDUSTRY 12
5.1. Local 12
5.1.1. Corporate Actions 21
5.1.2. Regulations and Government Policies 21
5.2. Continental 24
5.3. International 27
6. INFLUENCING FACTORS 30
6.1. Economic Environment 30
6.2. Investment in Infrastructure 30
6.3. Urbanisation 32
6.4. Local Content 33
6.5. Corruption 33
6.6. Input Costs 34
6.7. Cyclicality 34
6.8. Health and Safety Concerns 34
6.9. Technology, Research and Development (R&D) and Innovation 35
6.10. Labour 37
6.11. Environmental Concerns 38
7. COMPETITION 39
7.1. Barriers to Entry 40
7.2. Public Procurement and the Tendering Process 41
8. SWOT ANALYSIS 41
9. OUTLOOK 42
10. INDUSTRY ASSOCIATIONS 43
11. REFERENCES 44
11.1. Publications 44
11.2. Websites 45
COMPANY PROFILES 47
AFRO-TSION CONSTRUCTION PLC 47
ALEMAYEHU KETEMA GENERAL CONTRACTOR 49
CHINA CIVIL ENGINEERING CONSTRUCTION CORPORATION 51
CHINA COMMUNICATIONS CONSTRUCTION COMPANY LTD 53
CHINA RAILWAY GROUP LTD 58
CHINA ROAD & BRIDGE CORPORATION 63
CONSOLIDATED CONTRACTORS COMPANY 65
DMC CONSTRUCTION PLC 68
ETHIOPIAN CONSTRUCTION WORKS CORPORATION 69
FLINTSTONE ENGINEERING 70
HABESHA CONSTRUCTION MATERIALS AND DEVELOPMENT SC 73
HELA CONSTRUCTION PLC 75
MIDROC ETHIOPIA PLC 76
MIDROC FOUNDATION SPECIALIST PLC 78
RAMA CONSTRUCTION PLC 80
SUNSHINE CONSTRUCTION PVT LTD 82
SUR CONSTRUCTION PLC 84
TEKLEBERHAN AMBAYE CONSTRUCTION PLC 86
UNIVERSAL CONSTRUCTION PVT LTD 88