Financing rural industrialization and employment creation:The case of Ethiopia

Abstract

The objective of the study was to examine financing rural industrialization and employment creation practices and possibilities in Ethiopia. In this context, rural industrialization refers to encouraging small to large industries to be established in rural areas. As rural industrialization is a new concept at a policy level let alone to the practice on the ground in Ethiopia, a full-fledged data regarding the rural industrialization and the rural financing practice is inadequate.However, attempts were made to see at least the trends in agricultural commercialization, off farm practices, the government's policy, the financial institutions practices, and above all how other countries approached rural industrialization and financing such industries.Hence, relevant data were collected from CSA, NBE, DHS, World Bank, and Ethiopian Investment Commission and the collected data were analyzed using descriptive statistics. The major finding of the study indicates rural industrialization process is at conception stage and financing the rural strategy is still poorly developed despite the immense economic and social implications. Hence, a combination of centralized financing rural industrialization through commercial banks and a decentralized financing rural industrialization through microfinance institutions is recommended for the country to get better depth and breadth of rural industrialization.

The Role of Financial Institutions in Smallholder Agriculture Development:Ethiopian Context

“…This approach resembles the China's path of rural industrialization. However, despite the region-specific MFIs approach resembling China's path, the service delivery is far from being compared with China's rural industrialization (Durie, 2018). For this purpose, GoE gave and additional preferential advantage in the form of duty-free and land availability to further promote the rural industrialization process that can possibly facilitate the rural transformation.…”

Financing Agricultural Products: A Statistical Approach in sales data inside of a Brazilian State

“…As the result, it proposed that the analysis of legal support, the institutionalization of the system of public finance in Russia, has been carried out, as in a special role in crediting innovations in the field of agricultural production and modernization of peasant farms was played by the Moscow People's Bank (Galas & Seleznev, 2019). Durie (2018), had examined financing rural industrialization and employment creation practices and possibilities in Ethiopia, However, attempts were made to see at least the trends in agricultural commercialization, off-farm practices, the government's policy, the financial institution's practices, and above all how other countries approached rural industrialization and financing such industries. Using the descriptive statistics, the correlation analysis and the regression analysis analyses had conducted to understand how far the capital structure affects the profitability of agricultural holdings in the Czech Republic, considering a period of six years from 2008 to 2013 (Stekla & Grycova, 2016).…”