Growth and Transformation Plan 2010/11-2014/15

1.2. Performance of Eco nomic and Soc ial Sectors 9 1.2. 1. Agr icu lture a nd Rura l Devel opment 9

1.2.2. Trade a nd Industry Devel op men t 10

1.2.3. Mining 13

1.1.4. Road Deve lopm ent 13

1.2.5. Rail Netwo rk. Dry Port and Transpo rt 13

1.2.6. Telecommunications 14

1.2.7. Energy 14

1.2.8. Water and Irrigation Development 15

1.2.9. Co nstruction and Urban Devel op men t 15 1.2. 10. Education 16 1.2. 11. Hea lth 17

1.3. Cross C utting Sectors 17 104. Good Gove rnan ce and Democratization 19

1.5. Cha llenges and Good Pract ice in Implem enting the PASD EP 19 1.5. 1. Major Cha llenges Encountered 19

1.5.2. Good Pract ices Learned 20 CHA PTER 2. BASI S, O BJECTIVES AND ST RAT EG IC PI LLARS OF TH E GTP 21 2. 1. Basis of G rowth and Transformation Plan 21 2.2 . Objecti ves of the Plan 22

2.3. Strategic Pillars 22 2.3. 1 Sustain ing rap id a nd eq uitable eco nomic growth 22

2.3.2 Ma intai ning agriculture as a maj or source of eco nomic growth 22

2.3.3 C reating favourable co nditions for industry to play a key role in the eco nomy 23

2.304 Enha ncing expansion and ensuring quality of infrastru ctura l developme nt 24

2.3.5 Expans ion of soc ia l dev elo pme nt and gua rantee ing thei r q ua lity 25

2.3.6 Strengthe ning good gove rnance and capacity building 26

2.3.7 Empowe ring women and youth and ensuring their benefits 27 CHAPT ER 3. MACROECONOMIC FRAMEWORK OF THE GROWTH AND TRAN SFORMATION PLAN 28

3.1. Mac roeco nom ic Objectives 28

3.2. Mac roeco nomic Pol icies and Goa ls 28

3.2.1. Econ omic Growth, Sav ings and Investment 28

3.2.2. Prospects for Growth, Well being and Povert y 31

3.2.3. Fisca l policy 32

3.2.4. Monetary Policy, Externa l Sector and Financial System 33

3.3. Selected Macroecon omic a nd Sectoral Targets 34 CHAPT ER 4. FINA NCI NG THE PLAN 38

4.1. Government Revenue 38

4.2. Government Expenditure 39

4.3. Financi ng 40

4.4. OfT Budget Financi ng of Infrastructure And Industrial Program s 41 4.5. the role of the Private Sector and the public .44 CHAPT ER 5. ECONOMI C SECT ORS I> EVELOPM ENT PLAN 45

5.1. Agriculture and Rural Development 45

5.2. Industry 56

5.3. Trade 63

5.4. Mining 64

5.5 Infrastructure Development. 68

5.5.1 Roads 68

5.5.2 Railway Tra nsport 70

5.5.3 Energy 71

5.5.4 Telecommuni cation 75

5.5.5 Potable Water Supply and Irrigation Developm ent 77

5.5.6 Tran sport Serv ices 78

5.5.7 Mar itime Transport 80

5.5.8 Air Tra nsportation Services 81

5.5.9 Urba n and Construction Deve1opment.. 82 CHAPT ER 6. SOC IAL SECTOR DEVELOPMENT PLAN 86

6.1 Education and Training 86

6.2 Health 91 CHAPT ER 7. CAPACIT Y BUILDING AND GOOD GOVERNANCE 96

7.1 Capac ity Building 96

7.2 Information and Com municat ion Tech nology Development.. IOO ii

7.3 Justice Sector 101

7.4 Democracy and Good Governance 104 704.1 Strengthen ing Democratic System 104

7.4.2 Good Gove rnance 106

7.5 Med ia Broadcast and Communication 108

7.5.1 Media Broadcast. 108

7.5.2 Government Communication 108 CHAPT ER 8. C RO SS CUTTI NG SECTO RS 110

8.1 Gende r and Children' s Affairs 110

8.2 Youth and Sports Development 111

8.3 HIV/AIDS Prevention and ControL 112

8.4 SOCIAL Welfare 113

8.5 Labour Affairs 115

8.6 Population and Development 116

8.7 Culture and Tour ism 117

8.8 Scie nce and Techno logy Development.. 118

8.9 Environment and Climate Change 119 CHAPT ER 9. OP PORTUN ITIES, RISKS AND CHALLENGES IN IMPLEMENTING THE GTP 122

9.1 Opportunities 122

9.2 Risks 123

9.3 Managing Risks 123 CHAPT ER 10. MON IT O R ING AN)) EVAL UATI ON OF T HE GTP 124 10.1 . Background 124

10.2 Monitoring the Overa ll Plan Performance by MoFED 124

10.3 T HE Role of Federa l Executive Bodies 125 l OA CEN SUSES and Surveys for the M& E System 125

10.5 Geo-lnformation 127 ii i List of Ta bles Titl e Table 1. Growth in Gross Domestic Product and Main Sectors Share as Percent of GOP 4 Table 2. Percentage Share of Aggregate Consumption & Savings to GDP @C MP 6 Table 3. Percentage Share of Reven ue, Expe nditure and Deficit to GDP @CM P 7 Table 4. Import and Export trade share of GOP (%) 8 Tab le 5. Real GOP Proj ection Annual Growth Rate (%) 28 Tab le 6. Proj ected Trends in the Structure of GOP by Industrial origin (% share) 29 Table 7. Demand Side GOP as Ratio to GOP @ Current Market Prices (%) 29 Table 8. Proj ected Tre nds in the Structure of GOP growth by Industrial origin (%) 30 Tab le9 . Proj ected Trends in the Structure of GOP by Industrial origin (%share) 30 Tab le 10. Proj ected Tre nds in Structure of GOP from the Demand Side High Case Scenario (% share in GOP) 31 Tab le II. Fisca l Projection As a Percentage of G OP at @CMP (Ba se case Scenario) 33 Tab le 12. Selected GT P Ta rgets 34 Tab le 13. Proj ected GTP Reven ue Req uirements Under Base Case Scenario (in mIn ETB) 39 Tab le 14. Proj ected government Expenditures, Base Case Scenarios (m In ETB) 39 Tab le 15. Proj ected Budget Gap During GT P, Base Case Scenario (in mIn ET B) .40 Tab le 16. Resource need by Implementing Sectors, Budget Deficit and Financing (in mIn ETB) .4 1 Tab le 17. Off Budget Financing Requ irement of Infrastructure and Industrial Development Program s 42 Tab le 18. Off Budget Foreign Currency Requirement of Infrastructure & Indu strial Develo pment Programs 43 Tab le 19. GT P Targets for Agriculture and Rural Development 47 Tab le 20. GT P Targets for Micro and Sma ll-Scale Enterprises 58 Tab le 2 1. GT P Targets for Mediu m and Large Scale Manufacturing Industries 59 Tab le 22. GT P Targets for Chemical Industries 60 Tab le 23. GT P Targets for Pharmaceuticals Industry 60 Tab le 24. GT P Targets for Agro Processing Industry 61 Table 25. GT P Targets for Public Enterprises Management and Privatizat ion 61 Tab le 26. GT P Targets for the Mining Sector 65 Table 27. GT P Targets for Mineral and Petroleum Investment Expansion 66 Table 28. GT P Targets for Artisanal Mining and Marketing Promotion 66 Table 29. GT P Targets for the Roads Sub-Sector by Budget Year 69 Tab le 30. GT P Targets for the Railway Transport Sub-Sector 70 Table 3 1. GT P Targets for the Energy Sub-Secto r 72 Table 32. GT P Targets for the Telecommunicat ions Sub-Sector 76 Table 33. GT P Targets for Potable Water Supply and Irrigation Development... 77 Table 34. GT P Targets for the Tra nsport Services Sub Sector 79 IV Table 35. GTP Targets for the Mar itime Transport Sub Sector 80 Table 36. GT P Targets for Air Transpo rtation Service s Sub Sector 82 Table 37. GT P Targets fo r Co nstruction Devel opment Sub Sector 84 Table 38. GTP Targets for Urban Deve lopment Sub Sec tor 84 Table 39. GTP Targets for Ge neral Ed ucation 89 Table 40. GT P Targets for Tec hnica l and Vocat iona l Ed ucation and Tra ining 89 Table 4 1. GT P Targets for Higher Ed ucation 89 Ta ble 42. GT P Targets for Hea lth 94 Ta ble 43. GT P Targets for Gender Development and Children' s Affairs I II Tab le 44. GT P Targets for Yo uth and Sports Develop ment... 112 Table 45. GT P Targets for HIV/AID S Pre ven tion and Co ntrol 113 Ta ble 46 . GT P Targets for Labour Affairs 115 Table 47. GT P Targets for Popu lation and Development 116 Table 48. GT P Targets for Culture and Tou rism 117 Table 49 . GT P Target s for Sc ience a nd Technology Development 119 Tab le 50. GT P Targets for Environment and Climate Change 121 Table 5 1. Surveys to be Carried out by C SA During the Plan Per iod 125 List of Figu res T itl e Figu re I. G DP Growth by Economic Sector (%) 5 Figu re 2. Percentage share ofG DP by Economic Sector 5 Figure 3. Percentage Share of Agg rega te Co nsumption a nd Savings to G DP @C MP 6 Figu re 4. Percentage Share of Reven ue. Expenditure and Deficit to G DP @CM P 7 Figu re 5. Expo rt and Impo rt Growt h (%) 8 Ann ua l Ca lenda r The Greg orian ca le ndar is used throughou t this docume nt. The Ethiopia n ca lendar year 2003 starts on I I Septem ber of the Grego rian year 20 IO. In go vernme nt documents the th Ethio pian Fisca l Year co mmence s l" lI amle (G regorian calend ar 8 July) to 30 Se ne (G regorian cale ndar 7 July). T he Eth iopian Fiscal Yea rs fo r the GT P are eq uiva le nt to the G regor ian cale ndar as follows : Gregorian yea rs 8 July to 7 July 20 10/20 II to 2014/ 15 are equivalent to Ethiopian Fisca l Yea rs 2003-2007. v List of Acrony ms A IDS Acquired Imm une Defi ciency rcr Information and communication technology Syndro me IW I{ Business proces s recng inccr ing [T Information Technology BSC Balanced sco re card M&E Mon ito ring and eva luati o n eMP C urrent market prices M DG(s) M il lennium Development Goal( s) C PR Co ntraceptive prev alence rail' MoFEI) Ministry o f Finance and Eco nom ic CSA Central Sta tistical Age ncy Development eno Co m munity based orga nisati o ns NGO No n governmen tal organisation ESDP Education Sector Development o/w O f whic h Program I)ASDEI> Plan lor Accelerated and Sustained H Il Ethio pian Birr Devel opme nt to End Pove rty FA L Function al Ad ult Literacy PhD Doc tor o f Phil oso phy FDI For e ign direct inve stme nt SDI'RP The Sustai nable Development and Poverty GEQ!P General Education Quality Reduction Program 2002/03·200 4105 Improvement Package Tn Tuberculosis GDP Gross Dom estic Product TVE T Technical and Vocational Education and Gl l' The G rowth and Tra nsforma tion Plan Training 20 10/ 11 to 20 14/ 15 USD United Slates Dollar IIEI Higher Education Institutions WTO World Trade Organisation IIIV Il uman im munod c fleicncy virus IIRD lI uman resou rce develo pment Units of Measurement Used bln Bin km Kilometre (s) Gb/s Gigabyte(s) per sec ond m Metre GW II Gigawatt hour min mln h, Hec tare (s) MSE(s) Micro and small sca le enterpriser s) h, Iiour qlh, Qu intals per ha kg Kilogram (s) Qt Quintal (s)t C u r re ncy Rates 16.625R Ethiopian Birr (ETB) 1.00 United States Dollar USD A s of Nove mber 30. 2010 VI Foreword The main development agenda of the Ethiopian government is poverty eradication. All the country's development policies and strategies are, therefore, geared towards this end. Effective implementation of these policies and strategies in an integrated and comprehensive manner at various levels of government administration is key for eradicating poverty and dependence on food aid in a shorter period of time. There is a wide national consensus on the priority agenda of eradicating poverty and the policies and strategies pursued to address such a development priority. The Ministry of Finance and Economic Development is responsible for establishing a system for the preparation and implementation of national development plans, and in cooperation with the concerned organs, preparing the country' s economic and social development plan as well as following up the implementation of the same when ratified. The Ministry had accordingly coordinated the design and implementation of the Sustainable Development and Poverty Reduction Program (SDPRP), which covered the years 2002/03 - 2004/05) and A Plan for Accelerated and Sustained Development to End Poverty (PASDEP), that ran from 2005/06 to 2009/10. During these plan periods remarkable achievements of economic growth, social development and good governance were registered. On the basis of the experiences gained thus far and the national vision, the Growth and Transformation Plan (GTP) has been prepared with clear objective s and targets through wide public participation at both the federal and regional levels. The Council of Ministers and the House of People's Representative have adopted the GTP as the national planning document of the country for the period 20 I0/ II - 20 14/15. Implementation of the GTP requires huge resources and commitments. To this effect, emphasis will be given to ensuring effective public participation in implementation and monitoring of the plan, efficient and effective utilization of all available capacities of the public, the government and the private sector as well as better coordination and cooperation with the private sector and development partners. In this connection special emphasis will be given to encourage citizens to increase their savings and to strengthen the overall level of domestic savings for productive investment in GTP's priority programs. It is only when every citizen makes a concerted effort with commitment, and sense of urgency to discharge his/her own responsibility, that the effective implementation of GTP can be realized. This requires a fundamental change of thinking on the part of actors and stakeholders, particularly citizens, professionals, investors and the leadership, with respect to the implementation of the key directions envisaged in the GTP. In this regard, preventing and controlling rent seeking attitude and behaviour, and nurturing developmental initiatives are absolutely critical to realize the MDGs by 20 15 and the country's vision by 2020-2023. Hence, we need to firmly stand in unison in this bold and transformational jo urney of accomplishing the objectives of GTP so as to eradicate dependence on food aid, reduce poverty and create a solid foundation for the renaissance of Ethiopia. ~ / Sufian Ahmed Minister, Ministry of Finance and Economic Development vii Introduction Achieving broad-ba sed, accelerated and sustained econo mic growth so as to eradicate poverty has been and is a key objective of the Gove rnment of Ethiopia. The government has designed, and is impleme nting, strateg ies, policies and plans to guide and manage the overall devel opment of the country accordingly. The last five year development plan was the Plan for Accelerate d and Sustained Development to End Poverty (PASDEP). PASDEP had a medium term development perspective and aimed, at a minimum, at achiev ing the Millennium Development Goal (MDG) targets. During the PASDEP implementation per iod. high and sustained economic growth and signifi cant soc ial and huma n development results were realised. During the same period the economy grew on average at 11 % per annum. By susta ining the current economic growth over the next fi ve year period. the govern ment aims to achieve the MDG targets by 20 15, and its longer term vision of being a midd le income country by 2020-2023. The government has formulated the five year Growth and Transfonn ation Plan (GTP) (20 10/1 1-20 14/15) to carry forward the importan t strategic directions pursued in the PASDEP. The GT P envisages that, besides maintaining a fast growing eco nomy, better results will be realised in all sectors. In prepar ing the GTP the performance of the previous development plans, and the lessons learned du ring their implementation, were taken into account, with in the context of the country's development vision. Development of the GTP has benefited from the many consultative meet ings held at the Federal. Regional and local levels with government bodies, private sector organisations. higher education institutions, professional. women' s and youth associations. religious and civil society organisations. opposition political parties and development partners. Many issues which are believed to be important for ach ieving fundame ntal changes in economic growth, social development and good governa nce and which will contribute to realising the object ives of the GT P are raised and discussed in the consultations. These concerns are now adequately addressed in the GTP. Issues that were raised and which needed greater elaboration or more emphasis were add ressed and are also presented in depth at the sector and sub sector levels de scribed in the GTP. The Growth and Transformation Plan' s main objectives, strategies and targets are clearly set out in the document. During the GTP period special emphasis will be given to agricultural and rural development. industry, infrastructure, social and human development, good governance and democratization. The GTP takes into account two alternative economic growth scenarios: a base case and a high case. The base case scenario assumes that the previous five year's average annual G DP growth rate will be maintained. The high case scenario assumes that the GDP and the Agricultural Value Added achieved in 2009 / 10 will do uble by the end of the GT P period. 2014 / 15. Development programs that will be implemented in the GTP five year per iod will have a strong focus on improving the quality of public services provided. Thus special emphasis is given to investments in infrastructure and in the social and human development sectors. It is clear that implementation of the GTP will require mobilisation of considerable financial and human resources, especia lly for infrastructure development. For this reason, mobilisation of domestic fi nancial and human resources. as well as improvements in domestic savings are considered to be critical. One of the distinguishing chara cteristics of the GTP preparation process from the previous development plans preparation was that. a high level macro econo mic team was established with the responsibility of guiding the overall prepa ration process. Implementing agencies from the federal up to the regional and local levels have participated in the planning process through their functional linkages with their respective federa l institutions. Wide and extensive consultations that are led by senior government officials were held with stakeholders and the public at large both at federal and regiona l levels. In addition. large media coverage was accorded to the draft GTP, which contributed to raise the public aware ness and part icipation in the process. During the planning process. strong commitments. and part icipation of the private sector. developme nt partners. civil society organizations and the public at large are demo nstrated at all levels. It has been demonstrated in the consultation forums and the media that there is a strong national conse nsus and ent husiasm among cit izens with regard to GT P and its role in eradicating poverty once and for all. The plan preparation and approval process has been conducted based on a pre determined time schedule, which is summarised as follows. Scptcmbcr-Octobcr/2009 : Based on the initial directions from the government. the plan preparation Generic Guideline, incorporating general directions. main object ives. eco nomic growth targets and indicato rs, was prepared by the Ministry of Finance and Economic Development and circulated to Federal implementing agenc ies. reovcmber-neccmbcr/zues: Briefings on the initial ideas and the Generic Guideline were given to senior government officials and directors so that a common understanding was created as to the conte nt and preparation processes of GTP. A circular calling for the preparation of the GTP was then distributed to all concerned federal and regiona l govern ment institutions. February·j\'1a)'/201O: Based on the Ge neric Guide line, preliminary draft plans of key sectors (Agriculture and Rural develop ment Industrial Development, Educatio n, Health, and Good Gove rnance & Capacity Build ing etc.) were submitted to MoFED. June 2010: Based on the macroeconom ic framework and preliminary draft sector plans submitted to MoFE D. the draft consolidated GTP was prepared and submitted to the high level Macro Economic Team. The Macro Economic Team in turn reviewed and provided feedback on the draft consol idated GTP and its constituent key sector plans. July 2010: The first draft of the GTP was prepared as per the comments and directions provided by the Macro Economic Team. Discussion paper focusing on major achievements of PASDEP, obj ectives. strategic pillars and main targets of the GTP was prepared and distributed to the pertinent regional and federal bodies who participated in the consultation forums. At the same time, a preliminary draft of English version of the GTP document was prepared. August - September 2010: Country wide consultation forums were conducted on the draft plan to refine the draft further, and create aware ness among citize ns, actors and stakeholders so as to encourage their act ive participation not only in the preparation of the plan but also in the subsequent implementation of the GTP. The partic ipants in the consultations include civil servants and government oflicials, elected people' s representatives at different levels, representatives from universities and professional associations, the private sector, associations of wome n, youth and the disabled, civil 2 society orga nizat ions. development partners and opp osit ion politica l parties. Many useful co mments and suggestio ns were rece ived during the co nsultations. A ll con sultat ion s were led by se nior go vernment officia ls both at the regional and federa l level s w hile the final feder al leve l co nsultations were headed by the Prime Minister. O ctober 2010 : Further re finements o n the dra ft GT P document and checking for its internal co nsiste ncy we re co mpleted by inco rporating the co mme nts a nd feedba cks from the regiona l and fede ral co nsultations. Novem be r 2010 : The GTP document was then submitted to the Co unc il of Ministers. whi ch then e ndorsed it toget her with comments and direct io ns to be included in the final plan . After a five day de bate by the Ho use of Peop le' s Representatives. the document was endorsed wit h motion of tha nks a s the Offi c ial Natio na l Plan of the co untry for 20 10/ 11 to 20 14/ 15. The GTP is presented in ten chapters. Chapter I present s the progress and ach ievem ent s of the PASDEP. Chapter 2 co nta ins the objectives and strateg ies of the five-yea r Growth and Transformat ion Plan (20 10/ 11-20 14/ 15). Cha pte r 3 provid es the macroeconomic framework fo r the GTP and C hapte r 4 de scribes the costs of and financing for the GTP. C hapte r 5 de scribes the strategic directions. obj ectives and target s for the fo ur ma in econom ic secto rs: agricu lture and rural developm ent, industry and trade, mining and infrastructure. C hapte r 6 describes the strateg ic d irection s, obj ect ives and target s for the two ma in soc ial sec tors: ed ucation a nd training, and hea lth. Chapter 7 describes strateg ic directi ons, object ives a nd ta rgets for good governance and capac ity build ing. C hapt er 8 presents strategic di rections. obj ectives a nd target s for nine cross cutting sec tors. Cha pter 9 describes the opp ortunities. risks and cha llenges in impleme nting the GT P. Chapte r 10 presents the mon itor ing a nd evaluation frame wo rk of the GTP. 3 CHAPTER I. ACHIEVEMENTS AND CHALLENGES UNDER PASDEP The developme nt poli cies and strategies pursued dur ing the three year Susta inab le Deve lop men t and Po vert y Reduction Program (S DPRP) (2002 /03-2004/05). togethe r with the visio n expressed in and ac hieve me nts rea lised by the SDPRP. were the fo undation fo r the design of the PASD EP. The PAS DEP was impleme nted d uring the five year per iod 2005/06 -2009/ 10. It was prepared based o n MOO targets an d the go vernme nt' s vision for Ethiopia's deve lopment. Its main obj ectives we re en surin g accelerated. susta ined and broad based eco nom ic deve lopment as well as preparing the ground for the full achieve ment o f Ethiopia' s MOO targets by 20 15. To ach ieve these objectives the PASDEP was bu ilt on eig ht strategic pillars. These we re 1. Bui lding a ll-incl usive implemen tat ion ca pac ity, 2. A massive push to accelerate econ omic growt h. 3. Creat ing the balance between eco no mic development and populat ion growth. 4. Unleashing the pote ntials of Ethiopia's wome n. 5. Strengthe ning the infrastruct ura l back bone of the co untry. 6. Strengthe ning huma n reso urce devel opme nt. 7. Managing risk and volatil ity. and 8. Creating e mployment o pportunities. Based on these strategic pillars. two a lternative eco nomic growth scenarios we re co ns idered. In the base case scenario. it was co nside red that to achieve the MDG s a n ave rage economic growth rate of 7% per a nnum was necessary. For the high cas e scena rio. which a imed beyond achieve me nt of MDGs ta rgets. a 10% annual ave rage econo mic growth target was set so as to lay the founda tion for the realization of the development vision of the co untry.

1.1. MACROECONOMIC PERFORMA NC E The Eth iopian eco nomy has shifted to a higher growth trajecto ry since 200 3/04 . T his has been susta ined. and during the last five yea rs. overall rea l GDP has grown rapid ly at an average of 11 % per annum (See Table 1. and Figu re 1. bel ow.). Agriculture , Industry and Service s have registered an average annua l growth rate of 8.4%. 10% and 14.6%. respective ly. Table t. Growth in Gross Domestic Product and Main Sectors Shar e as Percent of GDP Sector Ave rage growth target planed Average growt h ac hieved Percentage sha re of (2005/06-2009/10) (2005/06-2009/10) Real G OP (2009110) Base Case Ili gh Case Real GDI' 7.0 10.0 11.0 100 Agriculture 6.0 6.4 ,.4 4 1.6 Ind ustry 11.0 18.0 10.0 12.9 Services 7.0 10.3 14.6 45.5 4 Table I above illustrates that. with the exce ption of the industrial sector. the over all and sectoral perfor mances achieved were well above the targets set in both the base case and high case scenarios. This has been particu larly pronounced in the service sector. Although the growth rate in the industrial sector is below the planned target. the sector achieved a signifi cant average growt h rate. Figure 1. GDP Growth by Economic Sector (0/0) 18 - ............... »>: --.... 16 14 _ A gu clll h il e and al lied a cuvrtr es .....l lJ\h ls t l'y 8 - -- Se r....ce 6 - R eaI G D P 4 2 o 2 1 )( 1~10 6 200610 7 2 11 07/HH 200H / 0 9 2 H1l9l 10 Ye ill · The contribution (percentage share) of each o f the three sectors (agriculture. industry and service) to overall GO P at the end of the plan per iod was 41.6%. 12.9% and 45.5%. respectively (See Figure 2). Figu re 2. Percentage sha re of GDP by Economic Sector 50 45 ••• ••• •• •• • • • • ••• ••• ••• 40 ••• ••• 35 •• • • ••• • • ••• ••• ••• ••• • 30 •m •• ••• ••• •• s 25 •• •• •• •• •• •• ••• • ••• ••• " ~• 20 •• •• •• ••• •• •• • ••• 15 •• • •• 10 •• ••• ••• ••• • •• 5 • ••• • • ••• • 0 •• • •• •• 2004105 2005106 2006/07 2007/08 2008/09 200 9110 Years [ D Agricull ure and allied activities D Service D lnduslry l 5 The planned targets were 43.9%. 16.5% and 39.6% for agriculture. industry and services respectively. The actual shares were not as planned. as services achieved a higher. and industry a lower share o f GOP than planned. In terms of structural change the PASDEP assumed that a decl ine in the agricultural sector's share of GOP would be taken up by the industrial sector. However, underperformance of the industrial sector was more than compensated by increased growth in the service sector. indicating that the structural shift was not. as yet. in the desired d irection. From the demand side, GOP at current market prices has increased by about 29.6 percent per annum during the PASDEP per iod. At the same time. gross capital formation, total export s and total imports. registered an annual average growth rate of 28.3. 27. 1% and 27.6% respectively. Ta ble 2. Percentage Share of Aggrega te Consumption & Savings to G n p @C MP Item 2004105 2005/06 2006107 2007/08 2008109 2009110 Total Consumption 94. 1 95.4 9 1.3 94. 8 93.6 94.4 Gro ss CapitalFormation 23.8 25.2 22. 1 22.4 22.7 22.3 Expo rts of Goods and Services 15. 1 13.8 12.7 11.4 10.5 13.6 Impo rts o f Goods and Services 35.5 36.5 J2 30.8 28.7 33 Reso urce Balance -20.4 -22.7 - 19.3 - 19.4 - 18.2 - 19. 3 Gross Do mestic Sa ving 5.9 4.6 8.7 5.3 6.7 5.5 Owing to the increased pent up consum ption demand. the domestic saving rate remained lower than the PASDEP target. The domestic saving rate was 5.9% at the beginning of the PASDEP period and remained at 5.5% in 2009/ 10. Likewise, consumption remained at much the same level throughout the PASDEP period leaving no room for growth in saving. Th is suggests that greater efforts are needed to increase the rate of domestic saving in order to meet the growing investment needs of the country. Figure 3. Percent age Sha re of Aggrega te Consumption a nd Sn ings to GDP @CM P Il " '"" D TOI~ 1 C OlOSUIIII" ;" " "" lD ( ;ros s C ~ pil 3 1 Fo" n a t"'" '" ~ E s po.-lS or Oood. alld s.:.... iee s j ~" ao IIJ R e s o "rc c B ~la nc c " ,D O r"". nom e s lie Sa'·in!,! A number of policy and administrat ive measures were taken to improve domestic tax revenue collections du ring the PASDEP period. These included strengthening the capacity of tax collection agencies. expanding the tax identification number system throughout the country, strengthening the value added tax system, increasing tax comp liance and tak ing 6 stringent legal measures against tax evas ion. As a result. domestic revenue achieved an annual average growth rate of 26% surpassing the PASOEP target o f 20%. However. domestic revenues as a share of GOP has marginally declined during the same period. As Table 3 below illustrates, total revenue as a share o f GOP fell from 18.9% to 17.3% over the plan period. with domest ic revenue marginally falling from 14.6% to 14.0% over the same period. Ta ble 3. Percentage Sha re of Revenu e, Expendit u re an d Deflcit to G DP @C l\-lP hems 2004 /05 2005 /06 2006/07 200 7/08 2008/09 2009110 Total Reven ue Incl uding Grants 18.9 17.7 17. 1 16.0 16.3 17.3 Dome stic Reve nue 14.6 14.8 12.7 12.0 12.0 14.0 Tax Reve nue 11.6 IO.R 10. 1 9.6 8.6 11.3 Non -tax Revenue 3 4. 1 2.6 2.4 3.3 2.8 Grant s 4.3 2.8 4.4 4.0 4.3 3.2 Total Expenditu re 23.5 22.4 20.7 18.9 17.2 18.6 Recurre nt Expenditure 12.6 11.6 10.0 9.2 8. 1 8.4 oJ\\' Defence 2.7 2.3 1.7 1.4 1.2 1.0 Capit al Expe nditu re 10.9 10.7 10.7 9.7 9. 1 In.3 Poverty Oricntcd expenditures 13.2 13.4 13.0 12. 1 IO.K 12.4 Expenditure Deficit including Grants -4.4 -4.7 -3.6 -2.9 -0.9 - 1.3 Deficit Financi ng. 4.2 4.7 3.6 2.9 0.9 1.3 External net 2.2 l.l 1.1 1.0 0.9 l.l Domest ic net 3.3 2.1 3.6 2.6 -0. 1 0.5 Figu re 4. Percentage Sha re of Revenu e, Expe ndit u re a nd Deficit 10 G n p @CMP as ---- -- 1_ ·....."1"o",,,u,"1" ,·h" ' I,, .. . ;.""" '" , , _ .... m . " k I< . nnu ~ • , I .... "''''o"u," ,- " .. n· .... I<~ .-~ n " ~ " ::- -~ . i '" :: ~~ ,- I- 1_ " ."" ·....'"I.:.".".h'"•• ......," . ...·,,' ·'·I""",h',,,. ., ! , - - .. /.. H.·f. n"" I .~ ,- - . - :so:: - "" 1- -,.('''1. .';''''~.. O.I~n".1 o. ,"·".h"..... lit ~ - >. . ' ~ I ," n , n , ,, ,..., - ~c " 200~f(I ~ 20n ~ fl'" 2 1K' 6f07 21KI7~l!~~l\lWf I0 , - . " 1"-" ,' 1',, • • ' ....,-'"" ,,, •.,,,,, ;,,.. ( ; 'H" " ., - 1- .,."·.,,.,1 - - H" fi ,' ;' H n H".-;n" ,, <t i- .... n.... " . nd _ 10 y .... .... On the expenditure side. the government has been prudent in its fiscal managemenl by closely monitoring revenue performance and adj usting its spending in line with its development priorities during the PASOEP period. In 2004/05 the share of total and poverty oriented expenditures as a percent of GOP were 23.5% and 13.2%. respectively. By 20091 10 the figures for each expenditure item are 18.6% and 12.4%. Further. the 7 proport ion of budget deficit. including grants. to GDP had decl ined from 4.2% in 2004/05 to 1.3% by the end of 2009/ 1O. Although. exports have increased during the PASDEP period. the trade balance did not improve as desired. The trade deficit widened during the period because o f a significant increase in imports. an increase necessary to sustain the high economic growth leve ls achieved. (See Table 4 and Figure 5) Table . t Import a nd Export trade sha re of G DP ( % ) hl"m 2004 /05 2005/06 2006 /07 200 7/08 2008/09 2009 /10 Average Export (merchandise) 6.9 6.6 6. 1 5.5 4.5 • .0 SA Import (merc handise) 29.5 30.3 26.3 25.5 23.8 23.3 26. 1 Trade balance -22.6 -23.7 · 20.2 · 20. 1 · 20.0 - )9.3 -20.9 Figur e 5. Expor t and Im por t Growth ( % ) 40 30 20 " Cl .l!l 10 ""~ " 0 • .... • ....o· • 200 b· 2006 0· .... 2009 ~ Q. 2008 ••• • ••• ••• -10 -20 •• •• ••• •• • ..• •• •• •• • -30 Years o Export ( Merchandise) Ea trrport (Merchandise) I!l Trade Balance In terms of monetary policy. the main obj ective was to achieve and maintain price and exchange rate stability. During the last five years the government has taken measures that curb inflationary pressures and increase the country's fore ign exchange reserves. Fiscal and monetary policy measures as well as admi nistrative ones were used to reduce inflation to single digit. For example. the National Bank raised the commercial banks' reserve requirement fi rst from 5% to 10% and then to 15% of net deposits. and raised the minimum deposit rate from 3% to 4%. 8

1.2. PERFORMAN CE OF ECONOMIC AND SOCIAL SECTORS 1.2 .1. Agr iculture and Rural D ev elopment Crop production : In 2004 /05 the total land covered by the three main crops was 9.8 mIn ba, by 2009 / 10 this area had increased to 11.25 min ha. Tota l out put increased from 11 9.1 min qts in 2004/05 to 19 1 min qts in 2009/ 10. Average productivity of these crops increased from 12.1 qtlha in 2004/05 to 17 qt!ha in 200 9/ 10. To realize these increases in product ion and produ ctivity it was planned under PASDEP to supply 820,000 tons of chem ical fertilizers. The actual amount supplied was 830,000 tons. Horticu ltu r e deve lopme nt: It was planned to develop 4 19,000 ha of fruit and vegeta bles by 20 10. The achievement at the end of the plan yea r was 152,600 ha. Besides, it was planned to produce 27.2 mIn qts and the achievement was 12.8 min qts. Coffee developmen t: It was planned to increase coffee production to 419,6 10 tons by 2009/ 10. In the event 34 1,000 to ns was produced, 8 1.3% of the target. Livestock prod ucti on : The PASDEP target was to increase meat productio n to 837,000 tons; but only 605,000 tons of meat was produced, 72.3% of the planned target. The target was to increase milk production to 3.39 1 min tons; and 96.2% of the planned target was achieved with 3.26 1 mIn tons of milk produced in 2009/ 10. In terms of anima l health services, it was planned that the number of veter inary clinics would be increased to 3,600; the achievement was 2,275, 63.2% of the target. The target for livestock vaccine was to supply 289 min doses in 2009/ 10; supply achieved was 96 min doses, 33% of the target. PASD EP aimed to increase the number of pastoralist and farmer trainees on basic veterinary service deli very to 3.000 and 4, 144 trainees ( 138%) completed this training by the end of2009/10. Agric ultural extension services: during PASDEP it was planned to train 5 1. 10 I graduates in the fields of plant, animal and natura l resource sciences and cooperatives development to support the agricultural extension service s. at agricu ltura l and vocational training colleges. At the end of the plan period 52,02 3 graduates had completed training in these areas. During the PASD EP period. it was planned to increase the number of minimum package trainee s to 10.39 mln: the achievement was 12.7 rnln. Although the aim was to increase the share of wome n trainees to 30% of the total. the percentage reali sed was 18.5%. It was planned to increase household family package trainees to 4.5 mIn by the end of the plan period and the achieveme nt was 5.4 mln, wh ich is higher than the planned target by 12.5% It was planned to increase the number of fanne rs training cent res to 18,000; the number actually increased by 9,265 centres, 5 1.5% of the target. The necessary equipments were also supplied for these newly built tra ining cent res. Agr'ic ult ural research : Encouraging results have been achieved in agricultural research in the three agro-ecological zones on crop, livestock. so il and water co nservation, forest development and agricultural extension practices. Some 409 new seed technologies have been issued in crop develop ment; 99 new breads in livestock and 9 1 different research outputs were developed on soil and water conservation works. Natura l resource developme nt a nd utili zation : Land right certifi cates were issued to 12.6 mln rural household heads; 185% above the target of 6.8 rnln household heads. It was planned to develop 58,750 hectares by estab lishing 470,000 wate r harvesting schemes and 9 small irrigation systems; by the end of the plan period 122.430 hectares o f land were developed by these means. During the PASDEP period. 853. 000 ha of land serviced by small scale irrigation systems was developed well in excess of the target of 487,000 ha. Land re ha bilitated by water and soil conser vation : The area of land rehabilitated by wate r and soil conservation works during PASDEP was increased from 0.82 mIn ha in 2004/05 to 3.77 rnln ha in 2009/1 O. With regard to forest conservation and management. the country's forest coverage was increased to 8.8 mIn ha from 4. 1 min in 2004/05. And at the end of the plan period the country' s forest coverage reached 6. 1 mIn ha. Food secu rity a nd safety net program s: Food security interventions aimed to resettle 161, I08 voluntary households of which 9 1,3 17 (56.68'Yo) households were resettled. As of 2009/10 a cumulative of 286,920 household s were food secure in resettl emen t a reas. Productive safety net programs benefited 730,494 beneficiaries of the targeted 1.5mln. In 290 woredas the number of farmers and pastoralists who were food insecure and needed assistance was 7.1 min in 200911 O. Forest co nserva tion a nd man agemen t: The country's forest coverage was increased to 8.8 mIn ha from 4.1 min. And at the end of the plan period the country's forest coverage was 6.058 min ha. Agricult ural market: 830,000 tons of fertilizer was supplied during the plan aga inst the target of 820,000 tons. The Ethiopian Seed Enterprise and other improved seed suppliers supplied 527,779 qt (doesn't include the supply by the regions) of improved seeds, against the target of 1.8 mIn qt. Agricult ural cooperatives: In 2005/06 there were 20,437 cooperatives with a capital of ETB 822 min and 3,642,602 members. By the end of 2009/ 10 the number of cooperatives was 33,636, their capital had increased to I bln birr and their membership had grown to 5,899,76 1. Moreover, 2 12 cooperative unions with 3,826 member cooperatives and a tota l capital of ETB 185,472.337 were established during the plan period. Agricult ural expor ts: The revenue generated from flower exports increased from USD 12.6 min in 2004/05 to USD 170 min in 2009/ 10. In the same period, the revenue generated from fruit and vegetable exports increased from USD 14.07 min to USD 31.7. 357.000 live animals were exported. a substantial increase on the target of 2 13.000. 319.647 tons of coffee was exported against the target of 323.000 tons. Overa ll. 1,225.000 tons of agricultural goods generating USD 1.55 bln were exported in the plan period against targets of 1,183,000 tons and USD 1.51 7 bin. respectively.

1.2.2. Trade and Industry Development T he Trade Sect or With regard to trade regulation, a trade registration and licensing system was introduced throughout the country, from federal to kebele levels. Gene rally, measures were taken to ensure competitive trade pract ices and protect consumers from unfair trade practices. During the PASDEP period a lot has been done in the process of trade partnerships and negotiations to make the country benefit more and hence create new market opportunities and increase foreign direct investment flow. The preparation for the WTO accession process was finalized. Negotiations were conducted to strengthen regional trade partnerships (Inter-Governmental Authority on Development, Sana'a Forum. The Common Market for Eastern and Southern Africa (COMES A) and the COMESA-East African 10 Community-Southern African Developmen t Community Tripartite). In addition Economic Partnership Agreement (EPA) was reached with the European Union. T he Industry Secto r During the PASDEP period support was given to micro, small, medium and large scale industries and, part icu larly, to industries that used agricultural inputs and were capable of generating foreign exchange. Micro a nd small sca le en terprise developm en t: As a part of PASDEP, the government took a number of initiatives to promote and expand micro and sma ll enterprise development in different regions and city administrations. The PASDEP target was to create 1.5 million new j ob opportunities in the sub-sector which was more or less fully achieved during the plan period. Substantial support was provided including increased supply of credit, training. provision of production and market facilit ies, technology support and provision of small enterprise information services. Te xtile a nd garme nt indu stries: During the PASD EP period textile and garment industries were expected to generate export earnings of USD 500 min. At the end of the plan per iod, the sub sector had, however, only generated export revenues amounting to USD 2 1.8 mln. far lower than the target. The low level of development of the sub-sector at the start of the PASDEP period is one of the main reasons for this under performance. There is a clear need to increase efforts and potential to improve performance of the textile and garment industries. It was planned during PASDEP to attract investment in new industrial factories worth USD 1.6 bIn. As a result a number of investment s were made, facilities developed and production contributing to exports commenced. These included: 2 weaving factories with a product ion capacity of 10,500 tons per annum ; 3 factories with a production capacity of 16.5 min metres of garrnents per annum; and, 10 sewing factories with an annual product ion capacity of9.3 mIn items of clothing. Those investments that. at the end of the plan period, had made investments, initiated proj ects and, in some cases. commenced product ion included: 4 factories with a production capacity of 8.225 ton trade per annum; 3 factories with the product ion capacity of 255 min metre garments per annum; 3 factories producing 33 min metres of processed garments; and I factory with a production capacity of 10 min items of clothing. Those investments that had finalised the preparation and started the investment process included: 5 weaving facto ries with a total capacity of 84,875 tons per annum; 4 factories with annual production of 61 mIn metre gray garments; 4 factories producing processed garments of 113 min metres; and 2 facto ries with a production capacity of over 2 1.6 min items of clothing. Other investors showed interest and pre investment processes are underway. Leather a nd leath er products: Leather and leather products (shoes and other leather products) were expected to generate USD 22 1 min in export earnings. In the event USD 75.73 min was earned by the end of 2009/10. It was planned to upgrade 74 unfinished leather processing factories to production of finished leather products but. in the event only II factories were upgraded, produced shoes and exported during the planning period; 14.9% of the target. As part of government' s efforts to develop capacity, the Leather Industry Technology Institute offered training in a 10+3 diploma and I year certificate diplom a program levels and also some tailor made training courses on leather processing, shoe and leather products making technologies based on customers' requests. II Suga r : During the PASDEP period. sugar industry development works included a feasibility study, irrigation and road works. sugar cane plantation development. housing deve lopment. construction and expansion of factories. and production of sugar and ethanol. It was planned to finalize the establis hment of two new sugar factories in Wonj i and Tenedaho and sugar factory expansion works in Metehara and Fincha. However, in Wonji, Tendaho and Fincha the percentage completion during the plan was 30%. 25% and 40%. respectively. It was planned to establish a new sugar factory capable of crushing 8.000 tons of sugar cane per day and. in this case, the target has been fully achieved. Investment licenses have been granted to plant sugar cane on 20,000 ha of land and 7,200 ha of land was planted . The ex isting three sugar factories were expected to produce 1,510.683 tons of sugar and 39.697 mJ of ethanol. Actual production ove r the PASDEP period was 1,468,91 5 tons of sugar and 30. 124 m3 of ethanol. Cement: The cement industry was expected to produce 4.7 min tons of cement per year. However, the industry achieved an output of only 1.17 min tons of cement per annum. This result suggests the need to increase the production and supply capacity of cement in order to meet the needs of the fast growing construction industry.During the early years of PASDEP implementation there was a dramatic increase in the gap between the demand for and supply of cement. This put considerable pressure on the const ruction sector. To ease the situation. short term and long term intervention plans were designed and implemented. The short term intervention plan involved importat ion of cement and construction of small scale cement industries. The long term plan involves develo pment of new high capacity cement producing factories. Implementation of this plan is being closely monitored. Meta l & metal engineering: In the metal and metal engineering industries preliminary measures were taken to unleash their full potential contribution to the country' s development efforts. To support exporting industr ies. spare parts were produced locally for four textile and two leather industries. In addition. a system was put in place that allow s the product ion of spare parts locally for sugar and cement as well as other manufacturing industries. Training has been provided on non-destructive testing. funded by the Internat ional Atomic Agency which a lso supported the purchase of equipment. Chemical ind ustries: During the PASDEP period. support was provided to chemical industries producing inputs for leather and textile industries measures. to add ress the cha llenges they were fac ing. Pharmaceuti cal indu stries: A strategic plan was developed for pharmaceutical industries to support producers of drugs and pharmaceutical equipment to allow them to import their raw mater ial and other inputs duty free. Steps were taken to ensure that government procurement systems give precedence to local pharmaceutical companies so as to encourage local industry. In some cases technical assistance and consultancy support was also provided to pharmaceutical companies to fulfil international drug producing standards and quality. Agro-proc essing indu st rie s: During the PASDEP period, an investment proposal was prepared for the government for agro-processing industries such as the sugar industry and for development of rubber tree. As a result, 3 companies created partnerships with fore ign counterparts. 16 potential export projects have been de signed and an assistance framework developed to help some of the projects start investment; some are now in the preparat ion process. Lastly, a master plan study for cereal, o il seed and coffee development has been prepared. 12

1.2.3. Mining The mining sector realised some significant ac hievements during the PASDEP per iod. The se include extension of the cove rage of country wide geological information, hydro- geological map ping, geo physics (grav ity) studies and engineering geology mapping from 38%, 27%. 65% and 6.9% in 2004/05 to 5 1%, 42%, 80% and 10% in 2009/ 10. respectively. It was planned to identify and del ineate 30 areas of mineral de posits, while 34 such areas were identified a nd del ineated by the end of the planning period. Annual investment in the mining sector increased from ETB 62 mIn in 2004/05 to ET B 12.7 bin in 2009/ 10. Revenue generated by the sector increased from ET B 20 mIn in 2004/05 to ET B 50.1 min in 200 9/ 10. Mining roya lty reve nues reached ET B 130 mIn in 2009/ 10. Gold and tantalum exports increased from 3,439 kg and 92.5 tons in 2004 /0 5 to 3907 kg and 202 tons respectively in 2009/10 . During the plan period it was expected that 5,000 kg of gold, purchased by the Nat ional Bank of Ethiopia from artisan miners, could be sold to foreign markets by the NBE. By the end of 2009/ 10, 5250 kgs of gold had been purchased by the NB E and USD 129 mIn rece ived by NBE from sales. An addi tional USD 2 mIn was generated by sales of 4,500 kg of ge mstones to foreign markets.

1.2.4. Road Development With regard to federal roads, the plan for the 2004/05-2009/10 period was to reinforce 852 km o f roads, upgrade 4,039 km. construct 2,769 km and execute temporary or heavy maintenance of 3,660 km of existing roads. Thus the plan was to construct or maintain a total of 11 320 kms of federal roads. and overall 96% of these PASDE P targets were real ised. In addition. 40 new federal roads were opened for traffic a nd more than 11 .000 km of road length added to the existing network. As a result, the total road length increased from 36,400 km in 2004/05 to 48.800 km in 200911 0. These figures exclude Woreda roads. The proportion of roads assessed objectively as being in good condition increased fro m 64% in 2004/05 to 8 1% in 2009/ 10. The time taken, on average country-w ide, to reach all weather roads has decreased from 5.7 hours in 2004/05 to 3.7 hours in 2009/ 10 . In gene ral, the performance of the road sector during the PASDEP period was remarkable.

1.2.5. Ra il Networ k, Dry Port a nd T ra nsport Rail Network: For the development of the national rail network, a feasibility study was conducted using latest satellite mapping technology for three rail corridors with a tota l length of 2.359 kms. In addition socio -economic and environmenta l studies of the corridors are underway. Dry Port: The construction of the Mojo and Semera dry ports was completed. A bilateral agree ment was reached with the gove rnment of Djibouti for a joint freight service to further facilitate export and import of commodities. A cargo term inal has been built on l 64.238 m2 land made ava ilab le by the govemment of Djibouti. The terminal has commenced services and will ease the transit of expo rt and import trade. Road transport: During 2004/5-2009110 a road safety council was established; on main transport corridor area s with a record of high accident le vels. traffic contro l was strengthened; measures were take n to ensure that accident victims receive immediate medical attention a nd a mass media public awareness campaign was conducted durin g the plan period. As a result of these measures, deaths due to road traffic acc idents decreased from 104 in 2004/05 to 52 per 10,000 acc idents at the end of the plan period. Private 13 companies we re co ntracted to ens ure tech nical inspection of vehicles. Moreover to address the transportation challenges facing the ca pital. Add is Ababa, the possibility of introd ucing mass transport syste m has been ex plored. Air Transport: A cargo terminal for storage of peri shable agricultura l products was constructed at Bole International Airport and a master plan for the airport was prepared. During PASD EP it was plan ned to co nstruct new or expanded airports at seve n locations. At Jiji ga. Humera and Assosa the air ports' runway co nstruction is co mpleted. At Jima. Jin ka. Kombolcha and Semera runway constructio n work s are at d ifferent levels of construction and pre-construction phases. Meke le and Bah ir Dar airports a re operating to Inte rnational Standa rds. The PASDEP strategy to increase the number of passengers and the amount of cargo has resulted in an increase of 1.55 min in 2004/05 to 3. 128 min in 2009/ 10 of the former and 1.42 bin ton/k ilometres in 2004105 to 2.84 bIn in 2009/ 10 of the latte r.

1.2.6. Te lecommunications Dur ing the PASD EP period the mobile telecom munications network capacity was increased from 0.5 min users in 2005/06 to 25 mIn in 2009/ 10. The number of telecommun ication c ustome rs increased from 0.56 min in 2004105 to 6.5 min in 2009/ 10. In the Unive rsal Access Program. a C DMA wireless network which co vers 90% of the co untry has successfully been installed and the system enables voice and data service availab ility to every kebele. Th e number of fixed line and mobile phone users was 0.62 min and 0.02 mIn, respectively in 2004105 and these increased to I min a nd 0.187 min. respectively in 2009/ 10. Th e percentage of the rural population with access (with in 5 kilometres radius) to a telephone service inc reased from 13% in 2004/05 to 62. 14% in 2009/1 0. To connect the co untry' s main communicatio n infrastructure, about 10,000 km of fibre optic ca ble (w ith high level information transmission ca pacity) was insta lled and has co mmenced rende ring services. A National Network O peration Centre that enables the centra l ad ministration of the network was estab lished and the ca pacity to co ntrol service quality standard and management of service failure information was put in place.

1.2.7. Energy The co nstruction of new hydropower plant s. includ ing Tekeze, G ilgel G ibe II and Tana Belese plants, enhanced Ethiopia' s hydropowe r generating ca pacity. In 2004/05 the tota l hydro power ge neratio n ca pacity co untry-wide was 7 14 MW. The PASDEP target was to increase power generation capacity to 3.270 MW by the e nd of 2009/ 10. Th e power ge neration capac ity actually achieved was 2.000 MW at the end of 2009/ 10 amounting to 62% of the target. The total power ge nerated in 2004105 was 3. 112 GWH. It was planned to ge nerate 10.907 GWH by the end of 2009/ 10, howeve r. only 7.689 GW H (7 1%) was generated. During the PASDEP period, to con serve electric e nergy. 4.6 mIn energy sa ving bulb s were distributed to customers. It was planned to increase power transm ission lines co nstructed from 8,380 km in 2004105 to 14.792 km in 2009/l0.T he total power tran smission line constructed was 12.147 km in 2009/ 10. which is 82% accomplishment of the PASDEP targets. It was also plan ned to increase power substation lines co nstructed from 25,000 km in 2004/05 to 136,32 0 km in 2009/1 0. By the end of 2009/ 10, the total power substation lines co nstructed were 126,038 km. 93% of the target. 14 During the plan period the rural electrification program aimed to increase the number of towns and rural villages which have access to electric power from 648 to 6.000 . Accord ingly 5. 163 towns and rural villages had gained access to electricity by 2009/ 10 amo unting to a 78% realisation of the PASDEP target. The total number of registered customers of electricity increased from 952.000 in 2004/05 to 2 min in 2009/ 10. 77% of the planned target. It was also planned during the PASDEP period to distribute 3 min improved energy saving biomass ovens and these have been distributed as planned. As a result. it is estimated that about 26. 176 ha of forest have been conserved from deforestation and carbon dioxide emissions have been mitigated by about 36,575 tons. About 10,081 rural fam ilies have benefited from distribution of home solar systems and 238 Rural Health Stations and First Cycle Schools have been provided with solar electric power. During the plan, the petroleum reserve storage capacity increased from 279.80 0 m' to 369,800m3 .

1.2.8. Water and Irrigation Developm ent Wat er supply: During PASDEP access to potable water increased from 35% to 65.8% in rural areas and from 80% to 91.5% in urban areas. Overall nationally, access to potable water has increased from 36% to 68.5%. The increase in rural access to potable water over the five year period is attributable to the provision of 793 very deep wells, 3.353 medium deep wells, 8,762 hand dug wells. 8,195 water fountain enhancement works, 478 water harvesting ponds. 3,294 rain water collection and, 7 run-off water harvesting systems. The number of malfunction ing water stations was reduced from 30% of the total to 20% in the plan period. Irrigati on : Irrigation deve lopment measures were taken during PASDEP to put in place small, medium and large scale irrigation schemes. At the start of 2004/05 it was planned to carry out irrigation scheme pre feasibility studies covering 177,998 ha, detailed studies for 464,051 ha, and initiation of irrigation works over 430,06 1 ha of land. The achievement by the end of the PASDEP period was 178,000 ha, 462, 114 ha, and, 65,243 ha of land for small, medium and large scale irrigation schemes. respectively.

1.2.9. Constr uct ion and Ur ba n Development Ur ba n Development: During 2004/05·2009/ 10, it was planned to construct 396,000 new houses, establish 10.000 small urban-based enterprises. and create job opportunities for 200,000 urban city dwellers. By the end of the PASDEP period 2 13,000 houses had been built in various regions and city administrations. In addition as a result of the housing development program, 4,306 small co nstruction enterprises were established, while 176.000 permanent and temporary jobs were created. Of the houses constructed 72,000 were handed over to the beneficiaries and ETB 93 1 mIn was received in pre payment from beneficiaries for the houses. A program to build capacity for decentralized service delivery was initiated within 18 cities with a total outlay of ETB 142.1 min. The project completed improvements to 14 city markets as well as dra inage and road rehabilitation projects and purcha ses of vehicles and equipment. Through the Urban Local Government Development Project infrastructure development works with a total outlay of USD 150 min (funded by the World Bank) were implemented in 19 major cities, including Addis Ababa. As part of this initiative and additional USD 53 min was provided by regional states and towns and this was allocated to construction of cobble stone interior roads. sewer line construction. small enterprises product ion and market place fac ilities, improvement of market places, development of 15 parks and water supply and sanitation works. A total of Birr 997 million was invested on these infrastructure creating 5 1,905 job opportunities through this initiative. Const r uction indust ry dev elopment: In order to develop the capacity of domestic private contractors providing con struction services 752 new contractors were given licenses and provided with tra ining. Financia l support and training were provided to these construction companies to enhance their capacity. Capacity building services were prov ided to 147 expert s organised as 43 consulting firms and, as a result, the numb er of consultants working in the construction industry increased from 177 in 2004/0 5 to 254 in 2009/ 10. Permits to import machineries with long term payment moda lities were awarded to increase the supply of construction machiner ies and address transportat ion problems. During the planning period 1,075 freight transportation vehicles, 1,000 dump trucks, 350 loaders, 100 rollers and 25 low-bed trucks were imported and distributed to domestic private companies on credit modalities. In addition 65 crushers and 125 loaders were distributed to companies of gravel suppliers. To address the shortage of construction materials and ensure sustainability for the fast grow ing construction industry, the government imported cement, steel and other construction mater ial, while encouraging domestic production of these items in the medium term . As a result very large quantities of cement and stee l were purchased and distributed locally durin g the plan period. Many micro and small scale enterprises received training, financial and adm inistrative support to increase their role in the supply of particu larly local construction mater ials.

1.2.10. Ed ucation Primary School Ed uca tion (G radc 1-8): The number of prima ry schools increased from 16,513 to 25,2 17 in the PASD EP period. Consequently, the number of classrooms increased from 16 1,795 to 247,698. The gross enrolment rate for grades 1-8 increased from 79.8% to 94.2% and the primary net enrolment rate increased from 68 .5% to 87.9%. The dispar ity in enrolment rates between male and female students gross enrolment ratio narrowed from 0.75:1 to 0.93:1. Secondary School Ed ucation (Grade 9-12): There were 706 secondary schools in 2004105 and th is number increased to 1,202 in 2009/ 10. In 2004/05 the gross enrolment ratio for secondary schools (9-10) was 27.3%; it increased to 39.7% in 2010 . The Net Enrolment Rate for secondary schools (9- 10) increased from 11 .8% to 12.6% du ring the same period. Ed ucation Qu ali ty : The primary school (Grade 1-8) student-teacher ratio decreased to 57: I by 2009/ 10 and the secondary school student-teacher ratio reached 43: I. The student- class ratio, in primary schools (Grade 1-8), fell from 69: I in 2004/05 to 62: I in 2009/ 10,w hile in secondary education (Grade 9- 12) it fell from 78: 1 to 68:1 in the same per iod. Technical and Vocationa l Ed ucation a nd Training: T he number of trainees undertak ing TVET increased from 106,336 to 717,603 dur ing the plan period. More than 50% of T VET trainees during PASDEP were fema le. The number of gove rnment TVET faci lities reached 253 in 2009/ 10. Higher Ed ucation: The numbe r of undergradu ate students in public universities was 78,232 in 2004/05 . This increased to 185,788 in 2009/10 . The proportion of under graduate female to ma le students in the publ ic universities increased from 24% to 29%, and the numbe r of students in graduate school increased from 3,604 to 9,76 1. The proportion of 16 fema le to male students at the graduate school increased from 9% to 11 .3%. During the PASDEP period the number of public universities increased by 13, and the total is now 22. With regard to building the capacity of university teachers, the number of university teachers increased from 4,847 to 11,238 in the plan period. Of these 5,706 (50.8%) hold a first degree, 4,528 (40.3%) hold a second degree and 1,004 (8.9%) hold a PhD.

1.2.11. Health The main objectives of the health sector component of the PASDEP plan were to reduce child mortality, improve mothers' health and combat the spread and prevalence of HIV/AIDS, TB and malaria. To achieve these strategic objectives and to ensure full health service coverage in all rural kebeles, a health extension strategy was designed and implemented. During the PASDEP period one of its targets was to train 30,000 health extension workers. In the eve nt, 33,819 were trained and dep loyed in rural kebe les all over the country. The number of health posts and health centres increased from 4,2 11 and 644 in 2004/05 to 14,416 and 1,787 in 2009/ 10, respectively. The number of public hospitals increased from 79 to I I I in the plan period. During the PASDEP per iod the number of women of child bearing age and using contraceptives increased from 15% to 32%, prenata l service coverage increased from 46% to 63%, postnatal service coverage increased from 15% to 30%, and trained birth assisted delivery increased from 13% to 25% - although the target was to reach 32%. In general the number of deaths of mothers which were related to del ivery decreased from 87 1/ 100,000 in 2005 to 590/ 100,000 in 20 10. The under-five mortality rate decreased from 123/1000 to 101/10 00. By 200911 0 about 10 mIn households living in malaria infested areas had received 2 mosquito bed nets each and by this means the cove rage of mosquito net usage has increased from 1% to 100% in the plan period. Also during the PASDEP period, the cure rate for TB increased from 65% to 67% and the incidence of HIV decreased from 0.68 to

0.28. The PASDEP target was to halt the HIV prevalence rate at 3.5% of the population and a better result was achieved with the prevalence rate droppi ng to 2.4% in 2009/ 10. In general, the health service coverage increased from 30% to 89% during PASDEP.

1.3. C ROSS CUTTING SECTORS Wo men and C hildren: The government has placed strong emphasis on the participation of women in the political, economic and social affai rs during the PASDEP per iod. In this respect following the enactment of the national policy on Ethiopian women, organizational structures responsible for women' s affairs were strengthened at federal, regional, and local levels. The family law and criminal were amended to fully ensure the rights of women. Efforts have also been undertaken to ensure the benefits of women in eco nomic growth and soc ial develop ment. For instance the participations and benefits of women in agricultural packages were significantly increased. To ensure that equal benefits from land rights accrue to husbands and wives, land utilization certificates bearing both husband' s and wife 's name are now being issued by regional governments. In food security programs vulnerable children and female headed households were given priorities. Similarly, in urban areas wome n were supported to organize themselves under micro and small enterprises so as to enhance their economic empowerme nt. The integrated housing development project which was launched in 2003/04 gave precedence to female applicants 17 for 20-30% of newly built houses and for the remaining 70% of houses, women competed equa lly with males. Youth and Sports: During the PASDEP period. a total of, 3.435.049 youths participated in various training sessions. More than 708. 116 youths received training in management skills and 444.595 youth association orga nizers rece ived training for the preparation and design of strategic plans. finance management and administration and related subjects. To organize and support sport associations 200 leaders were trained. 11 .193 sport associatio ns were established from national to kebele level of which 26 were estab lished and registered at national level. To expand and strengthen sport and fulfil comm unities' training and public sport ground needs. 7.567 different sports grounds were created in suitable locations. Cult ure and Tourism: During the PASDEP period. the average annual number of tourists visiting Ethiopia was 324.666 and they generated annual average revenues of ETB 1.61 bln. This achievement represents an increase in the ann ual average number of tourists and revenue generated of 2 1% and 16.3%. respectively. Specific initiatives undertaken during the fi ve year period included strengthening of wild life conservat ion areas. expa nding infrastructure and tourist facilities, improving national parks management and control, and giving part icular attent ion to community tourism. These initiatives resulted in the establishment of facilities for national parks at Alateshi, Borena Sainte. Maze. Chebe ra Churchura, Ka feta Sheraro and Gera le. Border demarcation of wildlife control areas was com pleted for Simien Mountains National Park, Bale Mountains National Park, Senkele rhino shelter, Shigesha and Tu lu lodge. At the Simien Mountains National Park 147 households were vo luntarily resettled to a pre-arra nged settlement site. Two investors have built lodges at Awash and Simien mountains national parks that contribute to expansion of the ava ilable facilities and create an encourag ing environment for more tourism. At Senkele a rhino shelter recreation centre has been built and, in schools which are close to wildlife conservation areas, nine natural resources conservation clubs have been strengthened and given aware ness creation training related for wildlife development and protection. Science and Technology: The national science and techno logy policy document was reviewed. revised and presented to government, taking into account the current situation and technological developments. A databa se was estab lished that identifies science and technology related capacity building requirements. To build national researc h capacity and support active researc hers, training was given to young researc hers and research institutions. Weekly radio programs and printed inform ation sheets entit led " From science and technology archive -kesaynese mahlder" have been distributed to enhance awa reness of and develo p interest in science and technology issues. Environment: A woreda environment management planning man ual was prepared. The manual aims to improve rural environments, contribute to sustainable development, improve living standards and ensure gende r equality. About 1,450 environmental experts received train ing on environmenta l management planning based on the manual. During PASDEP the target was that more than 125 woreda s prepare an environmental management plan; by the end of 2009/ 10, 11 6 woredas had prepared and implemented environment management plans. A dry waste manage ment strategy was prepared and a related proclamation was issued. Aware ness creation training on the dry waste management proc lamation was given to 65 expert s'. while 12 enviro nment impact assessment manuals were prepa red and made ava ilable. 18

1.4. GOOD GOVERNANC E AND D EMOCRAT IZATION The good gove rnance and democratisatio n strategies ad opted d uring PASDEP a imed to build the ca pac ity of the ci vil service to strengthen key public services that support a nd en ab le dem ocrat ic institution s, improve service delivery in the same area s, and con tinu e to strengthen the o ngo ing democratisation process. The democrat ic institution s addressed included those c reated before 2004/05 such as the Ombudsman. Human Rights Commission and Anti Co rruptio n Co mmission. These organisat ions were established to monito r the system for ad ministration of j ustice. prov ide soc ial accoun tabi lity and to ensure a sustainable. transparent and accoun table public ad ministration. The ma in focus of the five year plan was to give woreda ad ministrations increased aut hor ity and responsibility a nd g rant c ity administrations' and mayors' offi ces a n appropriate right for se lf admin istration. Within an overa ll o bjective of en suri ng deli ve ry of public services of high quality to the peop le, the focus has been to enhance the PASD EP implementation ca pacity at the local administrative leve l. address the shortage of skilled manp ower. and improve the rural co mmunication infrastruct ure. The go vernme nts' strategies to fight co rrupt practices. amo ng c itizens and public servants show enco uraging signs of impro vement in terms of identifying co rrupt perso ns. practices and orga nisations and bringing them before to the co urts. Awa reness creation sess io ns were provided for those peo ple engaged in the PASD EP preparation and monitoring with the a im of building public support and co nfidence through c itizen s' partic ipation in the PASD EP prep arat io n and implemen tation initiatives. A business proce ss reengineering exe rcise was carr ied out by eve ry gove rnme nt agency, as we ll as by woreda and kebe le ad min istrat ions. to improve public se rvice del ive ry and ensure tran spare ncy of ope rat ions and good gove rna nce. Extensive capac ity building programs have been implemented to strengthen the e ffic iency and accountability of the j ust ice syste m with significant achieve me nts during the plann ing period. Awareness creatio n wor kshops we re co nducted to add ress problems within the j ustice system. A co nflict prevent ion and re solution strategy was designed and implemented. A number of measure s we re a lso undertaken to stre ngthen rela tions bet ween regiona l go vernme nts so as to build a stro ng an d stable fede ral democrat ic system. Cases related to human rights and administrative biases we re given preceden ce in the decision mak ing process so that appropriate solutions co uld be q uickly put in place.

1.5. C IIALLENGES AND GOOD PR ACTIC E I N I M PL EM ENTI NG TilE PA SD E P 1.5 .1. Majo r Cha llenges Enconnte re d Implementation ca pacity: There we re cap ac ity co nstrai nts among leaders and public se rvants. at di fferent administrative levels. involved in key aspects of PASD EP implementation. To address th is cha llenge d uring PASD EP, the government la unched a num ber of process reengineer ing and training program s to impro ve skills and ensure appropriate implementation ca pac ity. Fina nce mobilisation : Lo w mobilization of domestic financia l resources was an othe r implementation challenge enco unte red d uring PASDEP. Of co urse dom estic revenu e and particu larly tax re venue ha ve been increasing over the yea rs fo llow ing the reform and adm inistrative measures take n by the gove rnment. Yet they rema in low com pared to the req uirements of the development program s of the co untry. A relat ed co nstra int that co ntributed to difficult ies in mobi lising adequa te reso urces was the low le vel of domestic 19 savings needed to support the huge demand for investment required for the country' s accelerating growth and development. Inflation: A major challenge encountered du ring the implementation of PASD EP was a significant increase in inflation. This was a potentially serious challenge to maintaining the macroeconomic stability. The government reacted in time with effective fiscal and monetary policies as well as administrative measures to reduce inflation to single figures. Rain : In some areas of the country, delayed arrival of rainy seasons, early withdrawa l and poor distribution of rain were cha llenges from which important lessons have been gained. Indu strial sector: The under performance of the industrial sector was due to inadequate technical and managerial skills in the sector, foreign exchange shortages to import essential raw mater ials, spare parts and other inputs, power disruptions, constraints of access to efficient and effective credit services. and power disruptions..

1.5.2. Good Practices Learned The lessons drawn from the implementati on of PASDEP and which formed one of the inputs to the design of the 2009/ 10-20 14/15 Growth and Transformation Plan (GTP ) are the following. Lead ership, management and organisation : Many useful experiences have been gained dur ing PASDEP on leading and managing the economy, on how to coo rdinate and mobilize the public at large, the private sector and non government organizations for accelerated and sustained growth. Agricultural productivity, production and scaling-up ' best practices' : During PASDEP, a number of model farmers who registered very high levels of productivity and product ion have emerged. The "best practices" of these model farmers have been analysed and documented for scaling up tothe rest of the other farmers during GTP period. This is expected to increase productivity and product ion of most of farmers, and bring them closer to the performance of the model far mers. Mobilising domestic resources: Significant experiences are gained during PASDEP as to how best to mobilize domestic resources and as to how to use domestic capaci ty most effectively to accomplish develo pmenta l interventions. These experiences are now integrated into the strategies and programs of the GTP for the next fi ve yea rs. Good governance: The introduction of the good governance package in the PASDEP resulted in a range of key interventions that contributed significantly to human development, democratizat ion, enhancing peoples' participation, building we ll integrated institutional capacity building and ensuring transparency and acco untability. The next five year plan will build on and expand the good governance initiatives. Indu strialisation : As there was not signific ant growth in the industry sector and more specifically in the manufacturi ng sub-sector, the lesson is taken onboard that, in the next five years, more must be done to increase the percentage share of the industrial sector in GDP. Social sector and infrastructure: Remarkable achievements have been realised in the PASDEP per iod with regard to significantly increasing acce ss to infrastructure and social services, particularly education and health services. Thus consolidating the achievements ga ined so far in terms of expanding infrastructure and social services and improving the quality of social services and infrastructure have stood out as one of the pillar strategies of GT P. 20 CHAI'TER 2. BASIS, OIl.JECTIVES AND STRATEGIC PILLARS OF' THE GT!'

2.1. BASIS OF GROWTH AND TRANSFORMATION I'LAN The country's vision. the achievements of r ASD Er, and the lessons drawn from its implement ation, were the basis for formulation of the next five year (20 I0/11-2 0 14/1 5) Growth and Transformation Plan (GTP). Factors which constra ined grow th and externa l shocks were tak en into accou nt in the formu lation of the GT P. Ethiopia 's vision which guides the GTP is: •• to become a country where democratic rule, good-governance and social justice reign , upon the involvement and free will of its peoples , and once extricating itself from poverty to reach the level of a middle-income economy as of 2020-2023." The country's vision specifically on economic sector includes: "building an economy which has a modern and productive agricultural sector with enhanced technology and an industrial sector that plays a leading role in the economy, sustaining economic d evelopment and securing social justice and increasing per capita incom e of the citizens so as to reach the level of those in middle-income countries." From 2003/04, the eco nomy shifted to a highe r growth traj ectory and the gro wt h mom entum was susta ined d uring the PASD EP period. Infrastructu re devel opme nt and soc ial se rvices have ex panded. Th e parti cipation of privat e investors and the community in ge neral was ve ry substa ntial. Dom estic resou rce mo bilizat ion increased the ca pac ity of the co untry to finance deve lo pment proj ects itsel f. The process of laying-out a foundation for democra cy and good gov ernance was given due atte ntion in reform programs undertaken d uring the PASDE P per iod. Am o ng the major challenges e nco unte red d uring the PASD EP im plementation period we re the high inflati on pressures on the balance of paym ents; the inadequ ate level s of, and co nstraining factors in, both otlicial dev elop ment ass istance a nd a lower level of domestic revenue collection than expected, (which led to d itli culties in mob iliz ing financ ial resource s to meet the grow ing dev e lopm ent need s of the co untry); and the unpredictability of rainfa ll. The GT P will co ntribute to ac hieve me nt of Ethiopia ' s visio n and to sustai ning rapid and broad based econo mic growt h. Th e experiences ga ined in resolving c ha lle nges that arose du ring, and lesson s learned from , the imple mentat ion of the PASDEP we re a sta rting poin t for formulation of the GTP. In summary, the ove rall o bjective of the GTP, ove r the five yea r period, is to sustai n broad based, fast, and eq uitab le econo mic growth so as to era dicate pove rty in d ue co urse. 21

2.2. OBJECTIVES OF THE PLA N The GTP has the foll owing maj or o bj ectives. I. Ma inta in at least an average real G OP grow th rate of 11% and atta in MDGs; 2. Expan d and ensure the qua lities of ed ucat ion and health services and ac hieve MDOs in the social sector; 3. Estab lish suita ble cond ition s fo r susta inable nat ion building through the creation of a stable democ ratic and deve lopme nta l state; and 4. Ensure the sustai nability of growth by reali z ing a ll the a bove o bj ectives withi n a stable macroeconomic framewor k.

2.3. STRATEG IC PILLARS Ethio pia 's obj ectives and strategies for susta ining rapid and broad-based economic growth path are dependent on the followin g GTP' s strategic pil lars. 1. Sustaining rapid a nd equitable eco nomic growth, 2. Ma intai ning ag ricu lture as maj or so urce of eco nom ic growth, 3. Creating co nditio ns for the ind ustry to play key role in the econom y, 4. Enhanci ng expansion and qual ity of infrastructure deve lopmen t, S. Enhanc ing expa nsion and qual ity of social development, 6. Building capacity a nd deepen good governance, and 7. Prom ote gender and yo uth empowerment a nd eq uity. Each of the strateg ic pillars is e labo rated a s fo llow s. 2.3. 1 Sustai ning ra pid a nd eq uitable econo mic growth In o rder to ac hiev e the vision of the co untry and, in d ue co urse, era dicate poverty and so imp rove the livel ihood of c itizens, it is imperative to susta in the higher eco nomic growth of the last S years and beyo nd. For thi s reason, inve stments in growth enhanc ing secto rs such as infrastructure and socia l sectors will continue at a la rger sca le. Econo mic grow th is ce ntra l in creating grow ing emp loyme nt o pportunities and Ethio pia' s transformation into a middl e inco me co untry. The agricu ltura l sector will co ntinue to be the majo r dri ver of eco nomic grow th. Ind ustrial grow th will be gi ven parti cular focu s. Rap id growth o f an indu strial sector that increase s the co mpeti tiveness of Ethio pia 's ex port s and re sults in import substitution will be encouraged. This a pproa ch is ex pected to res ult in the rapid and broad based econo mic growth that will prov ide a foundat ion for structura l transformat ion. The govern me nt' s effo rts to erad icate povert y and create em ployment will be pursued by sustaining ra pid and broad based eco nomic growt h in a mo re coo rdinated and structured manner.

2.3.2 Maintaining agriculture as a maj or source of economic growt h The experience s ga ined from the agric ultu ral development program , and lessons draw n from implementation of the PASD EP, were an input to the GTP agr icultura l deve lopm ent strategy. Th is strategy will support strongly the inten sifi ed production of marketable farm product s for dome stic and ex port markets, by small farm holders and private agricultural 22 investors. Fundamentals of the strategy include a shift to production of high value crops with a special focus on potential high productivity areas, intensified commercia lisation, and support for development of large-scale commercia l agriculture, where feasible. The commercialisation of smallholder farming will continue to be the major source of agricultural growth. Concerted support will be given to increase private investment in large commercial farms too. A range of public investments will be undertaken to scale-up the successes realised so far. Further strategies include development of a more transparent and etlicient agricultural marketing system and increased investment in marketing infrastructu re. To ensure that agriculture becomes the main source of growth for the next five years the key strategy that will be pursued concerns scaling up of best practices of model small holder farmers. Thus the best technologies and practices of the model farmers will be scaled up for use by all other fanners during the GTP per iod. This will in turn increase agricultural productivity and production. It is very esse ntial also to strengthen the go vernment structures at all levels so as to provide effective services that increase agricultural productivity. Although the emphasis will be on scaling up the best technologies and practices of model farmers. new technologies will also be developed and disseminated to farmers and pastoralists. In addition to promote multiple cropping. better adaptation to climate variability and ensure food security. the GTP will intensify use of the country's water and natural resources. Expansion of small scale irrigation schemes will be given priority, while attention will also be given to medium and large scale irrigation. Concerted efforts will be made to expand water shade management and to carry out effect ive water and moisture retaining works. Apart from improving productivity and living standards of the rural comm unities, these activities will help to cope better with the challenges of cl imate cha nge. Strengthening the conservation and management of natural resource is another focus area. The conservation and management of natural resou rces will mainly rely on the farmers and government capacities. Commercial horticulture will involve intensive farming and high value commod ity product ion. It will extensively use labour and hence is likely to concentrate in highland areas and closer to the maj or cities of the country. It will be integrated with the surrounding small holder farming. In addition, given the expansion of infrastructure and services through out the country large sca le extens ive commerc ial farming are likely to be encouraged to grow. The other element of the agricultural development strategy is the promotion of private large scale co mmercial farms in areas that are not occ upied or utilized by people. During the GTP period, agriculture will shift to a high growth path in order to meet the food security needs of the country, to curb intlationary pressures on agricultural products, and broaden the export base of the country. The sector will serve as a spring board for structural transformation in the long run by adequately supplying inputs necessary for industrial growth.

2.3.3 C reating favourable conditions fo r industry to playa key role in th e economy Ethiopia's narrow industrial base is a major co nstraint on the nation' s ab ility to generate foreign excha nge and create job opportunities for its growing labour force. In the GTP period, the industrial sector will receive the highest level of support for export oriented and import substituting industries. 23 In the ind ustrial sector. the government will focus in pa rticular o n strengthe ning micro and sma ll-sca le manufacturi ng enterprises. because they are the fou nda tion fo r the esta blishm ent and ex pansion of medium and large sca le industries. and ope n opportunities fo r employ me nt generation. expa nsion of urban deve lopment and provide c lose support for further agricultural deve lopm ent. Th e role MSE s play in sca ling up agricultura l secto r product ivity is irrefutab le an d for th is reason ap propr iate support will be provided to strengthen vertical and ho rizonta l linkages between agriculture a nd industry. The growth of MSEs a nd their integration with TVET system dev e lo pment will be instrumental in providing the necessary skills an d educat ion for technologica l transfer. Th is in an important part of the effort to support MSE s. as is the provision of capita l for MSEs' o perations through saving a nd credit institutio ns in a more transpar ent and accou ntable mann er. To solve the product ion fac ility problem s of MSEs and tho se linked to ident ifying market oppo rtunities, effo rts will be made by regions a nd c ity administra tio ns to provide product ion and marketing fa cilities at an affo rda ble cost. Ent repreneu rial as well as sav ing attitu des and behaviours will be wide ly promoted among micro and sma ll business o perato rs in part icular and among the public in genera l. Majo r suppo rt will also be given to establish and expa nd medium a nd large sca le industry . It is believed that these ind ustr ies will encoura ge technologica l tran sfe r, bridge the link between micro and small enterprises and improve the co mpetitiveness of do mestic resource based la rge-scale ind ustrie s. Medium and large sca le industries will also ser ve we ll the do mestic market and produce val ue-added produc ts fo r the export ma rket. Measure s to support se lected strateg ic import substituting ind ustries. both within the public and pr ivate domai n, wi ll be strengthened and this will hel p increase the fore ign exchange earnings and lay the basis for more rapid industria l de velopme nt. As is c learly stated in the Ethio pia' s Industria l Deve lopme nt Strategy, the val ue that can be added by the private sector is an impo rtant engine of the sectors' development. The business environme nt has ove r the years been co nduc ive to investment and the trade and investment frame work has improved rap idly, thus attracting both domestic and foreign investment. T he go vernme nt will co ntinue prov iding a ll the necessary fac ilities and support to real ize the GTP' s ind ustria l sec tor growth o bjectives .

2.3.4 En ha ncing expans ion and en surin g qu ality of infrastructural development The expansion and maint enance of eco no mic infrastructure such as roads, power and water supply, should be seen from the stand points of enha ncing and sustai ning pro-poor growth through j ob creation and promotion of industrial deve lop ment and, by these means helping to realize poverty eradication. Even though large investmen ts have been made o ver the previous plan period, the infrastructura l bac kbone of the co untry has not yet reac hed the q uantity and qua lity de sired becau se of the low threshold of eco nom ic infrastructure in 2004 /05. Co nstraints that have arisen to date in achiev ing the desired leve l of deve lopment inc luded limited loca l human cap aci ty and the large capita l investments needed, co mb ined with the high foreign currency com pone nt of those investments. During GT P per iod therefore emphasis will be put on both ex pansio n and ensuring quality of infrastructure developm ent. The experience in implementing previous initiatives. the c hallenges enco unte red, and the unantic ipated o pportunities that arose, have all co ntributed to lessons lea rned that have improved the strateg ies ado pted in the GTP. For insta nce, improveme nt in gross domest ic sa vings is a pol icy initiative ad opted by the GTP, in orde r to mobilise resources to fund 24 investments and promotion of import substituting industries. Investment in deve lopment of roads. railway networks. energy. irrigation and telecom mun ication will receive due attention during GT P period. A major effort will be made to increase investment in infrastructure by: increas ing domestic savings and pro moting impo rt substitution of materials that are necessary for the infrastructure devel opme nt. In the plan period. the road networ ks will be expanded. Every rural kebele will be co nnected to a n a ll weather road and thus to the main road network. Railway lines connecting various parts of the co untry will be developed. To meet the co untry' s gro wing energy needs effo rts will be made to increase use of alternative energy source s such as wind. geothermal and hydro energy. The ongoing telecomm unicat ion infrastru ct ure expa nsion program will be concl uded and good qua lity and effic ient services will be provided by fully utilizing this countryw ide and affordably priced infrastructure. In view of the role of urban ization for eco nomic a nd social develop ment, building the necessary urban infrastructures will be given emphasis to ensure rapid and eq uitable growth of urban ce ntres. Th e development of these urban infrastructu res will be implemented in a manner that they will co ntribute for MSEs development and employment creation. Adequate attention will also be given to improve urban sanitation amenities to create suitab le living and working environment. A co mprehensive regu latory and capac ity build ing framework will a lso be implemented in orde r to promote the development of a more produ ctive and competitive domestic co nstruction industry.

2.3.5 Expansion of social development and guaranrcctng their quality Improving citizens' living standards and develop ment of their human potential, is a key strategic pillar of the GT P. The gove rnment will take various measures to improve peoples' hea lth. productivity and skills. Among oth er benefits. these measures will increase the potential for gove rnment' s policies, strateg ies and programs to realize their objectives. The main initiatives that are expected to ensure that this strategic pilla r is realized are improved access to good quality higher and adult educatio n. very wide access to good quality primary health care. better acce ss to safe water and sanitation fac ilities. halt ing the spread of HIV/AID S and other key infectio us diseases. improving food security a nd nutrition, and improved housing conditions. Education and training : The progress to date has been encouraging. In order to susta in this level of progress. the government will increase its efforts to deve lop the country's human resources by improving the acce ss to and the quality of education in the next five yea rs. To improve access to education. efforts wi ll be made to address issues that hinde r students' , espec ially female students', enrol ment. Appropriate importance will also be given to pre-primary and functional adult education. To improve the quality of education. measures will be taken to address existing shortcomings by increasing the numb er of teachers and schools. The government will expand and improv e the initiatives taken to date in its General Education Q uality Improvement Program . Higher education: The key priority in the higher education system during the five year GT P will be to ensure the syste ms' quality and releva nce. To this end. the management and administrat ion of universities will be improved and strengthened. Efforts will be made to ensure the Higher Education Strategic Ce ntre a nd the Higher Education Q uality Assurance Agency fulfil the ir missions. The performance and implementatio n capa city of technology institutes will be developed further. Adeq uate supply of unive rsity teachers will be ensured through the implementation of a full fledged teacher deve lopment program. The revised curricula will be implemented taking into account crucial issues such as instructional 25 processes, assessment and examinat ions and student achievement. The government will launch a big push to strengthen science and technology in higher education. Child care, specia l needs a nd adult lite racy: The early childhood care and education system will be made cost effective and more participatory and be expanded in both formal and non formal education delivery mechanisms. The education strategy for ch ildren with special needs will be fully implemented. A functional adult literacy program will be expanded across the country. Technical and vocational edu cation & train ing: The TVET system will continue to be an instrument for technological transfer, through the development of occupational standards, accreditation of competencies, occ upational assessment and accred itation, and the establ ishment and strengthening of the curriculum development system. TV ET institutes will serve as the centres of techno logy and skill accumulation for micro and small enterprises (MSEs). Rigorous and regular mon itoring and eva luation of TVET institutes will be carried out. The TVET program will be part of the government's capacity building program to strengthen engagement with, and productivity of MSEs, as a key instrument for creation of employment opportunities. Health Serv ices: The GTP will focus on improving the health of the population th rough provision of primary health care services that will be supported by the health extension program. In addition measures will be taken to ensure quality hospital services and better supply of medical drugs. The government will strengthen the measures it takes to improve the numbe r, skills, distribution and management of health workers, through enhanced training of physicians (specialists and genera l practitioners). New systems of health care financing will be explored and implemented to overcome the existing bottlenecks. An incentive package will be developed to encourage domestic production of pharmaceutica l products. To increase the contribution of the private sector to health services, efforts will made to improve and extend the delivery of services and their quality. Lessons will be drawn from other countries and integrated in the initiatives to be taken to improve the private sectors contribution to the health system. Mobilisat ion of external finance, together with dome stic finance, in orde r to fund GTP healt h sector initiat ives, will receive major attention. Private pharmaceutical factories will also be encouraged to sustainably produce and deliver quality pharmaceuticals. Generally GTP aims to fully achieve the MDG targets for the sector. 2.3 .6 Stren gthenin g good gnve r n a n ce and ca p aci ty building Strengthening institutional capac ity is critical to implement the GTP policies, strategies and programs and there by achieve satisfactory results. Apart from other existing, structural and institutional constraints. the country' s economic growth and social development are hindered by organisationa l capacity constraints. Government has designed national programs, policies. and strategies that strengthen and sustain the country's implementation capac ity, institutionally and organisationally. This is a vita l contribution to the on-going proces s of democratization. For example, during the GTP period, the implementation of Civil Service Reform Program and Good Governance packages will be strengthened to ensure efficiency, effectiveness, transparency and accountabi lity at all levels. The capability of civil servants. at federal, regional and local levels will be strengthened. Concerted efforts to improve information and communication syste ms will be made that contribute to the socioeconomic transform ation process. 26 In order to facilitate the strengthening of the stable, democratic and developmental state that creates an enabl ing environment for development, major em phasis wi ll be given to strengthening democratic institutions, building up the capacity of civil service and civil society organisations and establishing a system for citizens' access to information. Public participation will be strengthened at all levels to ensure better transparency and accountab ility in public dec ision mak ing. In addition, the effectiveness of the justice system will be improved and laws will be amended to ensure that implement ation and interp retation is in confor mity with the constitution. The independence, transparency and accountab ility of courts and the judicial system will be ensured. Law enforcement institutions will be strengthened by improving the knowledge and skills of the human resources' emp loyed and by providing the equipment required. Finally. the publics' understanding and awa reness of constitutional issues will be increased and the custom and tradition of peaceful resolution of disputes improved . Another critical element of th is pillar strategy concerns ensuring transparency and accountab ility in public decision making, as well as preventing and contro lling corruption. In this regard, the focus will be on radica lly improving the tax and land admi nistrat ions of the country. At the center of such refor ms are improv ing the registration and information systems of income, property and land. In addition, public education and awareness creation that bring about attit udinal and behav ioural changes, as well as effective enforcement of laws will be pursued. The establishme nt of reliable and un iform vital statistics and identification system of citizens will also be undertaken during the plan period.

2.3.7 Empowering women and youth and ensuring their benefits Women and Youth : The objectives of the GTP can only be achieved when the multidimensional prob lems faced by women and youth are addressed. To th is end, the government will scale up its efforts to implement its Women' s and Youth Pol icies and Programs. These policies contain essential initiatives that will contribute to the participation and effective utilization of the untapped potential of these key soc ial groups. During the GTP period, women and youth initiatives will aim to ensure equitable socio- economic and political participation by and benefits directly for, wome n and youth in our society. Unleashing the potent ial cont ribution of youth and women to national development wi ll have a profound effect on the speed, equity and sustainability of the country' s overall growth and development. Ove r the last few years major efforts were made to increase the enrolment of girls in schoo l, expand coverage of fem ale health services, and increase extension services to women far mers in rural areas. These efforts included also leg islative and institutional refor ms to protect the rights of, and open opportunities for, women . Although, progress has been made there are still challenges relating to changes in attitudes and traditional malpractices. Government is committed to speeding up the pace of chan ge through educa tion, by increasing the part icipation of women in public life. and by strengthening women' s membership in gender based organizations. Child ren: Relative to other sect ions of the community. children' s vulnerability to manmade and natura l disasters is higher. Efforts to date to m inimise children's vulnerability will be increased during the plan period. Primary targets included in the GT P are to ensure equitable benefits to children from develop ment initiatives, support vulnerab le children, minimise harmful traditional practices that affect chi ldren, and protect children' s rights and safety. 27 C HA PTE R 3. MACROECONOM IC FRAMEWORK O F T HE GROWTH A ND TRA NSFORM ATI ON PLA N 3. I. MAC ROECONOMIC OBJ ECT IVES Macroeconomic policy objectives for the fi ve year GT P per iod 20 10/1 1-20 14/15 are the maintenance of macroeconom ic stability so as to e nco urage savings and inve stment by ad opti ng a pprop riate polic ies designed to prom ote rapid and broad based eco nomic growth. Fiscal and monetary policies will be mana ged in a manne r consistent with these macroeconomic objectives.

3.2. M ACRO ECO NOMI C POLI CI ES AND GOALS The macroeconom ic goals of the GT P are synchronized with the overall policy objectives of mainta ining the growth momentum witnessed during the PASD EP period. Ethiopia's vision of becomin g a middle incom e country. and meetin g its MDG target s at a minimum. 3.2. 1. Economic G rowth, Sa vings and In vestm ent The Ethiopia n economy has reg istered a n average annual real GD P growth rate of 11 % during the five yea rs 2005106 to 2009110. The lesson teamed duri ng PASD EP and SDPRP periods. is that sustainable. rap id and equitable gro wth is esse ntial to the GTP . It is growth that wil l help c reate employment and ra ise income. eve ntually e radicating povert y. Two growth sce narios are considered in the GT P: Base Case and High Case Scenarios. a) Base Case Scenario Under the base case scenario, Ethiopia's economy is projected to grow at a n ave rage annu al growth rate of 11 .2%. This is the average growth rate attained during PASDEP a nd the GTP intends to maintain this growth momentum. Under the base case sce nario. it is assumed that the economy will be able to grow provided that the same stable policies and strateg ies are followed at macroeconomic and sectoral levels as adopt ed previous ly; that prudent monetary and fiscal policy ensures that inflat ion remains at single digits; and that tax collection and admi nistrat ion systems are strengthened so as to increase domestic revenue substantially. A ll MDO targets will be met under the base case sce nario. Table 5. Real G DP Projection Ann ual G rowth Rate ('10) Se cto r 2009110 20 10/11 20 11/12 20 12113 2013 /t4 20 14/t!' Ave rage Agri culture & Allied 7.6 Activities 8.5 8.5 8.6 8.6 8.7 8.6 Ind ustry 10.6 14.0 17.9 2 1.4 23.0 23.7 20.0 Services 13.0 12.5 11.5 10.5 9.5 9.0 10.6 Real GDI' 10.4 11.0 11.1 11.3 11.2 11.4 11.2 As shown in Tables 5 above. growth is expected to be broad based: agriculture is expected to grow on average by 8.6% per annum whi le industry and services are expected to show ave rage annual growth of 20% and 10.6%. respectively. 28 T a ble 6. Projec ted T re nds in the Str uctur e ofG DP by Industrial or igin (% sha re) Secto r 2009/10 2010/11 2011 112 2012 / 13 2013/14 2014/15 Ave ra ge Agricult ure & All ied Activities 4 1.6 40.6 39.7 38.7 37.8 36.9 3 8.8 Ind ustry 12 .9 13.2 14 .0 15.3 16.9 18.8 15.6 Serv ices 45 .6 46 .2 46.3 46.0 45.3 44 .3 45.6 To bring about structural transfor mation in the economy. it is expected that the industria l sector's sha re of GDP wi ll grow 12.9% to 18.8% and the agric ultural sector's sha re will decrease from its current 41.6% to 36.9% at the end of the plan period. The service sector's sha re of GD P is proj ected to decrease from 45.6% to 44.3 %. Achievem ent of these target s will provide an enabling env ironment for economic growth by balancing demand a nd supply of agriculture a nd industry sectors. Looki ng a t de ma nd side of G Il P, there are two mac roeconomic balances to be considered, namely the reso urce gap between savings and investment and the trade balance between exports and imports (the export/import gap). In the GT P per iod prudent macroeconomic managem ent will be adopted to maintain these macroeconomic balances. A single digit inflation rate is targeted to preva il throughout the GTP period . During 20 I 0/ 11 to 20 14/ 15, GDP at current market prices is forecasted to grow at a rate of 17.2% on ave rage, which is lower than the rate of growth during the PASOEP period. By the end of PASO EP, the share of total final consumption expenditure to nominal GDP was expected to decrea se, but, it re mained unchanged at around 94%. At the end of the GT P period total consumption is forecasted to reach 85% while dome stic savings are targeted to inc rease from 5.5% in 2009/ 10 to 15% of GDP in 20 14/15 and the five year avera ge will be 11.9%. Gross domestic investment is forecasted to avera ge 27.5% ofGDP during the plan period. In 2014 /1 5 gross ca pital for mation is proj ected to take a 28.2% share of GDP, rising from 22 .3% of GOP in 2009/ 10. During the GTP period, the savings and investment gap is expected to narrow and reach 13.1% at the end of the plan period. from its presen t level of 19.4%. This is a reflection of the gove rnment' s intention to raise domestic savings towa rds the investment financing requirement. In order to effectively raise dome stic sa vings macroeco nomic stability and measures that ensure an enablin g environment. such as increasing financial sectors accessibility and diversifying their services. will be take n during the plan period. (See Table 7 below) Ta ble 7. Dem and Side GD P as Rati o to G DP @ C u r re nt Ma r ket Prices ( % ) .-h e rll ~e (20 1011 1- Item 200 9/10 20 10/ 11 20 11112 2012 /13 20 13/ 14 20 14/ 15 20 14/15) Total Consu mption Expenditure: 94.5 92.6 89.6 87.6 85.6 85.0 !l8.1 G ross Domestic Cap ita l Format ion 22.3 25.3 27.2 28. 1 28.9 28.2 27 .5 Exports of Goo ds and Non-Factor Ser vices 13.6 16.6 17.7 19.2 20.8 22.5 19A Imports of Good s an d Non -fac tor Services 33.0 JU 34.5 ] 4.9 35.3 35. 7 35.0 Resou rce Balance ( 19.3 ) (17.9) ( loJl) (15.7) ( 14.5) ( 13. 1) ( 15.6) G ross Do mestic Sav ing 5.5 7.4 10.4 12.4 14.4 15.0 11.9 29 To ease the pressure on the balance of payments. policy and administrative measures that promote growth and divers ification of exports will be undertaken. At the end of the plan period. the share of exports to GOP is expected to reach 22.5%. a rise from 13.6% in 2009/1 O. High value products such as horticulture and other new export items will receive major support from the governme nt. Combined with these initiatives, support will be provided for import substituting industries so as to ease the shortages of foreign exchange the country is experiencing. The share of imports of goods and services to GOP at current mar ket prices is forecasted to reach 35.7% (See Table 7 above). h) High er Case Sce na r io The basic assumption for the high case scenario is the doubling of agricu ltural value added. by sca ling up the level of productivity o f smallholder fann ers and pastoralists to the productivity levels of existing best (model) fanners. Th is places the economy on a higher growth path than the base case scenario. Because of the potential of multiplier effects of the smallholder farmers, the increase in agricultural supply will stimulate growth of other economic sectors. Under the high case scenario, it is assumed that the possible upward shin of demand, caused by the doubling of agricultural value added by the end of the GTP period, will be stabilized by increased supply of agricultural sector goods that will keep the inflation rate in single d igits. An annual average GOP growth rate of 14.9% is targeted under the high case scenario. Agriculture. industry and service sectors are expected to grow on average by 14.9%. 21.3% and 12.8% per annum, respective ly (See Table 8 below). At the end of the plan period the percentage share of agriculture. industry and service sector are expected to be 4 1%, 16.9% and 42.1%. respectively. (See Table 9 below) Tahle 8. Projected Trends in the St r uctur e of (;OP growth by Industrial origin (%,) 2010 / 11·2014/15 Sector 2009/10 20 10/tl 2011112 2012113 2013 / 14 20 t4/15 (A ver azej Agricu lture & 7.6 9.5 13.5 16. 1 17. 1 18,4 14.9 AlIicd Activities lndustrv 10.6 14.& 19,4 20.& 23.7 27.9 21.3 Services 13.0 14.6 13.& 12.9 11.8 10.9 12.& Real GOP 10,4 12.5 14,4 15.3 15.6 16.6 14.9 Ta ble 9. Projected T rends in the St r uctur e of G OP by Industrial or igin (%sha re) AH'rage Sector 2009/tO 2010111 20 11/12 2012/13 2013/ 14 20 14/ 15 (2010111- 20 14/ 15 Agriculture & 4 1.56 39.9 39.5 39. 8 40.3 4 1.0 4 1.2 Allied Activities Industry 12.87 13. 1 13.7 14.3 15,4 16.9 14.8 Serv ice 45.58 47.0 46.8 45.8 44.3 42. 1 44.0 Real GDP 100.0 100.0 100.0 100.0 100.0 100.0 100.0 The GT P five year average of total consumption expenditure. gross domestic cap ita l formation, total export and import as a percentage share of GOP is forecasted to reach 88.9%.22%.1 9.7% and 30.5%, respectively. The gross domestic saving as a percentage of GOP will reach 17% at the end of the plan period. up from 5.5% in 2009/ 10, resulting in a projected resource gap of 4. 1%. 30 Ta ble to. Projected T rends in St r ucture a fG DP fro m th e Dem and Side lligh Case Sce na r io ( % sha re in G OP) Aver age Item s 2009110 20 10/11 20 11112 20 12113 20 13/ 14 20 1·4115 (20 1011 1- 2014/t 5 Total Con summion Ex penditure 94.5 93.9 9 1.9 89.2 86.4 no 88.9 Gross Do mestic Capital Formation 22.3 22.6 22.4 22. 1 2 1.7 2 1.2 22.0 Expo rts of Good s and Non - Fac tor Services 13.6 15.5 17.5 19.5 21.7 24.0 19.7 Impo rts of Goods and Non - Fac tor Ser vice s 33.0 32.6 3 1.7 30.6 29.4 28. 1 30.5 Resou rce Bala nce ( 19.3) ( 17.0 ) ( 14.2) ( 11.0 ) (7.7 ) (4. 1) (10.8) Do mesti c Sa vings 5.5 6.1 8. 1 10.8 13.6 17.0 ILl 3.2.2.Prospects for G rowt h, Wellbei ng a nd Pover ty Macroeconom ic indicators are used to understand the linkages between growth and poverty reduction efforts. Understanding poverty and wellbeing indicators and analysis of poverty enables the causes of poverty to be identified. The results of poverty analy sis are important in designing policies. deve loping strategies and in identifying measures to be taken by the government. Analysis of poverty also helps to evaluate the success of ongoing policies and strategies. and their implementation. Poverty analysis is multifaceted. The cost of basic needs approach is used to measure the income or consumption expenditure aspects of poverty. Consumption is preferred as an indicator of welfare, as opposed to income. because consumption better captures the long- run level of wel fare than current income. Consumption also reflects better the households' ab ility to meet basic needs and it reflects the extent of households' access to credit and ab ility to save when their income is higher . For these reasons. consumption indicators make a better measure than income. because they reflect actual household living (or welfare) standards. For consumption to be an accurat e indicator of households' welfare it has to be adjusted to take account of the difference in the calorie requirements of different household membe rs; for age and gender of ad ult members for instance. This adju stment can be made by dividing real household consumption expenditure by an adult equivalent scale that provides a proxy measure of the nutritional requ irement of each family member. The adult equivalent scale will. therefore. vary for different age groups and with the gender of adult household members. For the reasons descr ibed, many of the poverty analysis instruments, such as the head count ratio, use consumption indicators rather than income ind icators. 'Total poverty' refers to an aggregate measure of poverty that takes into account both the food and non-food requireme nts. At this point it is worth not ing how poverty lines are establ ished. The most widely used method of estimating poverty lines is the cost of basic needs method (minimum expenditure approach). This method is applicable because the indicators used are more representative and the threshold will be consistent with real expenditure across time. space and income groups. Following from the above justifications for, and defini tions of. the methodology adopted. the food poverty line is defined by selecting a bundle of food that is typically consumed by the poor. The quantity of the bundle of food is determined in such a way that it supplies a 31 predeterm ined rmrurnum calorie requ irement level (2, 100 kilocalories). This measure enab les us to establish a consistent poverty line for Ethiopia. On this basis, the Food Poverty Line is determine d by the minimum per capita expenditure requ ired to acquire the bundles of food which provide 2,100 kilocalories. In addition to this measure, the total minimum per capita expenditure for basic needs (food and non-food) is used to determine the Poverty Line. Using this methodology the Central Statistical Agency carried out studies in 1995/96 that determ ined that the poverty head count was 45.5% and the number of people under the Food Poverty Line was 49.5%. It is clear that, in Ethiopia, economic growth is cruc ial for the eradication of poverty over time, for citizens to enjoy fast grow ing living standards. This economic growth has to be rapid, susta inable and fair. Failure to realize such type of economic growth will place considerable constraints on the poverty eradication agenda . It is for these reasons that Ethiopia ' s development policies in general, and the GTP policies and strategies in particular, place great focus on ensuring sustained, rapid, broad based, poverty reducing and fairly distributed economic growth. Such economic growth will result in jobs being created, as a result citizens' earnings will rise and their living standards improve and this will lead to the cou ntry breaking out of the poverty trap. The recent study conducted by the Ministry of Finance and Economic Development, " Dynamics of Growth and Poverty in Ethiopia (2008)" (based on three wide ranging studies, the Household Income Co nsum ption And Expenditure Survey, Wel fare Monitoring System and the Participatory Poverty Assessment) shows that a I% per capita GDP increase will result in a 1.7% decrease in the poverty head count index. Based on the identified relationship betwee n economic growth and its elasticity to poverty, it is calculated that the poverty head count ratio and the food poverty ratio have dec lined to 29.2% and 28.2% at the end of the year 2009/ 10, respect ively. An updated calculation of the linkage between economic growth and poverty reduction will be determined when the current Household Income Consumption Expenditure study is completed. It is expected that the current HICE study will revea l that the poverty head count ratio, and the percentage of people living below the food poverty line, will be less than the current estimates because actual economic growth has been higher than proj ections for the last several years. For this reason the GTP boldly aims to achieve the MDG target of halving ext reme poverty and hunger by 20 14/ 15.

3.2.3. Fiscal policy The mediurn-terrn fiscal policy objective is aimed at maintaining the defic it at a sustainable level. This requires inflation to be conta ined at single digit levels while simultaneously increasing public spending on pro-poor sectors. Among the major objec tives of the fisca l policy are to strengthen domestic revenue generat ion capacity, finance maj or investment projects with own revenue, mobilize external grants, arra nge external borrow ing accordi ng to the borrowing policy of the cou ntry, and to mobilize domestic borrowing in a way that does not adve rsely affect macroeconomic stability. On the rC\ICDUe side, implementation of the on-going tax reform program will be enha nced by strengthening tax administration and co llect ion. During the GT P period. efforts will be geared towards promoti ng compliance and equ ipping tax co llection age ncies with adequate enforcement powers. These strategies will further boost revenue mobilization at federal and regional levels. The government will acce lerate the pace of implementation of the tax reform program by strengthening the capacity of tax collection age ncies, implementing the Tax Identification Number system throughout the country, 32 improving the presumptive tax system. developing and implementing an aud it progra m to cove r all taxes, and improving the adm inistration o f the Value Added Tax. Efforts will also be made to improve the tax base and bring new businesses into the tax net. particularly where they were beneficiaries of tax incentives (tax holidays). As a result of these measures. it is ca lculated that. by the end of the GT P period. the share of total domestic revenue and tax revenue to GOP at current market prices wi ll reach 17. 1% and 15%. respectively. The share of budget de ficit including grants to GOP at current market prices will be ma intained at abo ut 2% on average so as to mainta in macroeconomic stability (See Table 1I below). Table II , Fisca l Projection As a Percentage of GDP at @C M P (Base case Scenario) Average Items 2009 /10 2010111 2011112 2012113 2013 /14 2014 /15 (2010111· 2014 /15 Total Reve nue lncludin ' Grunts 17.3 17.8 18A 19.2 2004 20A 19.2 Domest ic Revenue 14.0 14. 1 14.2 15.3 16.8 17. 1 15.5 Tax Reve nue 11.3 11.7 12. 1 13.2 14.7 15.0 13.3 Non-ta x Revenu e 2.8 2.4 2. \ 2. \ 2. \ 2. \ 2.2 Gran ts 3.2 3.7 4.3 3.9 3.6 3.3 3.7 Total Exrcnditu rc 18.6 20.5 20.2 21.1 22.3 23.7 2 1.6 Recurr ent Expenditure 8.4 8.9 8.6 8.' 9. \ 9.3 ' .9 Capital Expenditure 10.3 11.6 11.6 12.3 13.3 [4.4 [2.6 Povcrtv Orie nted expenditures 12.3 13.5 13.7 14.R 16. 1 17.3 [5. 1 Expenditure Deficit includin g ( 1.3) (2.7) ( 1.7) ( 1.9 ) ( 1.9 ) (3.3) (2.3 ) Grants Dcflclt Eina ncin u U 2.7 1.7 1.9 1.9 3.3 2.3 External net l.l 1.0 0.8 0.8 0.8 0.6 0.8 Domestic net 0.5 1.6 0.9 1.\ 1.2 2.7 1.5 On the expenditure side. resource allocations have been guided by the government's pro- poor growth policy where by the lion' s share of available resources are allocated to priority infrastructure and services that enhance pro-poor economic growth and social development. Th is policy will be applied more vigorously dur ing the GTP period. Accord ingly. the highest percentage share of tota l spending will be allocated to pro-poor sectors where ca pita l expend iture as a percentage share of GOP is forecas ted to reach 14.4% at the end of the plan period. (See Table I I).

3.2.4. Monetary Policy, Exter na l Sector and Fina ncial System Monetary Policy Ethiopia' s monetary policy will continue to focus on maintaining price and exchange rate stabi lity so as to create a macro economy that is conducive for rapid and susta ined economic growth. Inflation will be held at single digits during the GTP period (2010/ 11- 20 14/ 15). Measures will be undertaken so that growth o f money supply will not be in excess of nominal GOP growt h. During the GT P period a stable foreign exchange rate is envisaged. which wi ll not only encourage export growth but also import substitution. These in turn would facilitate stable economic growth and significantly minimize foreign exchange constraints by strengthening hard currency reserves. To implement the GTP both direct and indirect monetary instruments will be used as appropriate. T he government wilt develop and implement initiatives to encourage domestic 33 sa ving and investmen t. In this regard real interest rates will be ma inta ined above ze ro .while non- traditiona l so urces of revenu e mobilization such as bond sales to citizens at home and the Diaspora will be put in place. The co ntribution and co verage of social security se rvices will be improved , while policy mea sures that enco urage domestic sa vings fo r mac hinery and housing investment will be introd uced. Financial system In the GT P per iod the financ ial sector will be strengthened with the aim of establish ing an accessible, e fficie nt a nd co mpetitive financial sys tem. One purpose of this initiative is to increase domestic savi ng so as to sustain the fast and sustainable grow th required to provide resources for ex panding and improv ing public services . Govern me nt will introd uce capacity building measures to raise the efficiency of finan cial institutions and improve banking practice s so as to ensure health y co mpetition, support private secto r ban ks and finan cia l instit ution s to improve the coverage and qua lity of the finan cial se rvices they provide and help them to minimize non-performing loans and improve the ir pro fitability. During the GTP pe riod, greater e mphasis will be placed o n strengthening modern payment systems, deve lopi ng regulatio ns to inte rnational sta nda rds and fac ilitating acce ss to finan cia l services. It is ex pected that these init iatives will e nable the current level of access to finance of 20% to reach 67% by the end of the plan pe riod. The Nationa l Bank of Ethiopia will strengthen its human resources and information techn ology infrastructure. The capac ity of the Ethio pian Fina ncia l Institute wi ll be strengthened. Information tech nology that supports the ban k informat ion exc hanges system wilt be exte nded to microfinan ce institutions. The expan sion and improvement o f modern IT networks, a nd their effective util izatio n by financial instit utions will ea se com municatio n a nd fac ilitate the flow of real time mo ney from one corner of the co untry to ano ther. The introduction and wide r application of payments systems that use faster, ele ctronic means, such as cards, mo bile or other elec tro nic instrum ents, will facilitate improve d banking services and help to reduce tran sact ion costs.

3.3. SELECTED MACROE CONOMIC AND SECTORAL TARGETS Ta ble 12 summa rizes the key macroeconomic and sectora l targets expected to be reached at by the e nd of the GT P period. T hese targets are a lso used to trac k the progress of the eco nomy and monitor the effect iveness of the GT P impacts as measured by major indicators. Details of targets are presen ted in the chapters and sec tions that follow. Table 12. Selected GTP Targets Baseline Plan Ta rge t Sectc r / t nd tca te r 2009/10 2014/15 The Ma cr o Econom y Real GDP growth rate (%) l OA 11.4 Per capita GDP @;CMI'(USD) 377 482/523 Total consumption expenditure as% or Ci Dp 94.5 85.0 Gross domestic capital format ion as% of CiDP 22.3 2&.2 Gross domestic saving us% of Gl) !' 5.5 15.0 Govern ment Finance Domestic revenue including grants as% ofGDP 17.3 20,4 34 Baselin e Plan Target Sectorll ndica tor 2009/10 20 14/ 15 Dom estic revenue as% of GDP 14.0 17. 1 Tax reve nue as% of GDP 11.3 15.0 Total pover ty-or iented expenditure as% or GDP 12.3 17.3 To tal expe nd iture as% share of ODP 1It 6 23.7 Capital expenditure as% of GDP 10.3 14.4 Rec urrent expenditure as% of GD!' 9.3 Overall balance includ ing grants as% of GD!' '" ( 1.3) (3.3) Externa l (Net) as% of GDP 1.I 0.6 Domestic ( Net) as% of GI>P 0.5 2.7 Externa l sector Total exports as% sha re of GDP 13.6 22.5 Total imports as% share of GDP 33.0 35. 7 Resource gap as% s hare of GDP ( 19.3) (13. 1) Merc handise export as% share of OD P 6.7 15.6 Merchandise import as% share or ODI) 26.5 32.0 Pove rt y & Welfare Total Poverty Head Co unt (%) 29.2 22.2 Food Poverty Head Co unt (%) 28.2 2 1.2 EC OJ'lriO M IC DEVELOPM ENT Agr ieult ure Agricu ltural a nd allied act ivities growt h ( 'Yo ) 7.6 ' .7 Crop productivity (qVha) 17.0 22 .0 Flower (min stem) 2.7 48 5.859. 1 Land cove red with multipurpose/versatile trees (thousands ha l 6.058 16.2 10 Number of extension service benefi ciaries (thousands) 5.090 14.640 Coffee exports t'ronncs) 3 19.647 600.970 Meat ex ports (00 0 Metric Tonn es) 10. 18 II I Num ber of households participat ing. in Productive Safety Net progra m 7. 1 1.3 (mln) Indust ry Sugar prod uction (000 tonnes) 3 14.5 2250 Sugar ex port (000 tonnes ) 0 1.246.3 Export of sugar (USD mln ) 0 66 1.7 Text ile a nd garment industry export earnings (US n min ) 2 1.8 1000 Leat her and leathe r products industry expo rts ( USD min) 75.73 496.87 To tal cement produci ng ca pac ity (m in ton) 2.7 27 Metal consu mption per ca pita (kg) 12 34.7 35 Baselin e Plan Target Sectorll ndica tor 2009/10 201-1115 Mining Gold expo rt (kg) 3.907 X. 700 Gold sold to NBE b~ urtisan al miners assoc iations ( kg) 2.866 5.250 I NI;RASTRUCTlIRE Il EV ELOPM ENT Road s Total road length 1 road network (000 km ) -1.8.8 6-1..5 Avcragc rime taken to all- weathe r road (hrs) 3.7 \.4 Road density [km /I 000 km2 ) -1.-1..5 123.7 Road density (km /l (jOO po pulation) O.M 1.54 Roads in accepta ble condition (%) 8\ 86.7 Area further than 5 km from all-weather muds (%) 64 29 Construct ion ornew all weather road that connect all rura l kc belcs II 71.523 with main roads ( Km) Railwa)' Railway network (Km} - 2395 [ nerg"v Electricity scrvice co. . erage (%) ,\ 75 Power genera ting eapae it) ( MW) 2.000 8.000 Reduce transmi ssion lincs power losses (%) 11.5 5.6 Increase number of new c ustomers (min) 2 , Length of dist ribut ion lines construction (Km ) 126.038 25lW38 Rehabilita tion powe r rransrntssto n lines (Krn) -1.50 8.130 Te teeo mm uni cation Fixed line telephone density (%) 1.36 3.4 Mobile tele phone acces s/d istribution (%) Rural popu lation telccomm unication service access within 5km rad ius 8.7 62. 14 " 100 (%) Fixed telephone subscribers (in min) 1.0 3.05 Mob ile telephone subsc ribers (in min) 6.52 '0 Internet service subscribcrst in min) 0. 187 3.69 Water Ove ral l pota ble water coverage (% ) 68.5 98.5 Urban population with access to potab le water within 0.5km (%) 9 1.5 \00 Rural population with access to pota ble water within 1.5km (%) 65.8 98 Land develo ped for mcdium & large sca le irrigation schemes (%) 2.5 15.6 Co nst ruction a nd Ur ba n Development Jo bs created to reduce urban unemployme nt rate in tow ns under \ 76 \ 82 integrated housing develo pment (000) 36 Baseline Plan Target Sectorllndicator 2009 /10 2014/15 Jo b created thro ugh MSEs (min) - 3.0 Provision of housing and basic serv ices (n umber of housing units) 2 13.000 370.000 Reduction of slum areas (%) 60 30 Road co nstructed with cobblestone (km] - 373H SOCIAL DEVELOPMENT Edu cation Net primary enrolment rate (I-H) (%) H7.9 100 Primary school girls to boys ratio 0.93 :1 1:1 Primary school pupil text book ratio 1.25:1 1:1 Adu lt education part icipation Me (%) 36 95 Total numbe r of undergraduate studen ts in governmen t higher 185.788 467.44 5 institutions Total number of TV ET students 717603 1.127.330 Health Primary health services coverage ( %) '9 100 Under flve mortality rate (per 100(1) 101 6' Infant mortality rate (%) 77 31 Maternal mortality rate (per IOO.UOO) 590 267 Contraceptive preva lence rate (CPR) (%) Births attended by skilled hea lth person nel (%) 32 25 ""60 Under one year penni 3 immunization coverage ( % ) sz 96 Percentage of ho useholds in malaria prone area s with insecticide - treated bed nets (%) lOll ron Reduce inc idence of malaria 1l.7 <0.7 II IV/AIDS incidence rate (%) 0.28 0.14 Increase TB case detection rate (%) 36 75 37 C HAI'TER 4. FI NANCI NG THE PLA N Financ ing soc ial and economic devel opme nt programs is essentia l for the real ization of the o bj ectives stated in the GTP. Allocation of finance is based on the med ium term Macro Eco nomic Fisca l Framewo rk, an instrume nt used by the go vernme nt to frame reso urce expectations from domestic and externa l sources and allocate resources to key secto rs in line with the overa ll development o bjectives of the co untry. The process of preparing the Macro Eco nomic Fisca l Framework begins by identifying the overa ll reso urce e nve lop e in the period from 3 to 5 years. Dur ing the GTP five ye ar period, a llocati on of devel opment fi nance will a im to suppo rt the ov erridin g obj ect ive of po verty eradicatio n - within the co untry's finan cia l capac ity a nd wit hin the ma intenance of stable macroeconom ic co nditions. Ba sed on these o bjectives, a larger share of total go vernme nt spending will be a llocated for deve lopment of pro poor and growth en hancing sec to rs. Gove rnment recurrent ex penditure will be fu lly financed from domestica lly generated revenue whilst, capita l expend iture will be financed by dome st ic revenue and external sources. Proj ections of government reve nue, allocation of resources to gov ern me nt's prio rity sectors, estimates of budget deficit. and financing under the base case sce nario are presented in the followin g sec tions. 4.I . G OVERNM ENT R EV ENUE Do mestic revenue will be mob ilized mai nly from ta x and non-tax sources. Estima tes of revenue co llected from taxes for the five year per iod 20 I011 1 to 20 14/5 ass ume full imp lementati on of GTP init iativ es, inc lud ing on-go ing tax reform, improve me nt in effi c iency of ta x ad ministration, and broad ening the tax base in line with the econom ic growth anti c ipated a nd the potent ia l reso urces that ca n be mobilised. Non-ta x sources of revenue will be mobilized from the dividends and proceed s of public ente rpr ises. Other initiatives to ra ise financ ing for the GT P inc lude encouragi ng private sa vings and investm ent, sca ling up external de velopment assista nce and increas ing Fo re ign Direct Investment (FD I). Th ere a re so urces of de ve lopment finance that do not appea r in go vernment's budget. The se incl ude off -budge t fi nancing by NGOs, loca l governme nt expe nditures using the ir ow n reso urces, and o wn source spending by public ent er prises. Du ring the five year GTP period, domestic reven ue, incl udi ng grants, is ex pected to reach ET B 173 bIn by the end of the plan period, up from ETB 66.24 bIn in 200911 0, o ut of which, ET B 145.3 bIn will be mobilized from dom estic so urces a nd the remain ing ET B 27.7 bIn ET B from extern a l sources. (See Table 13 below). 38 Ta ble 13. Projected GTP Revenu e Requirem ents Under Base Case Scena r io (in min ET B) Total Items 2009 / 10 20 10111 2011/12 2012/ 13 2013114 2014/15 (20 10/11- 2014115 Total Revenue Including Grants 66.237 79.806 96.94 1 118.28 1 147.524 173.040 6 15.59 1 Domestic Reve nue 53.86 1 63.3 15 14.58 5 94.1 19 12 1.660 145.299 498.978 Tax Revenue 43.3 15 52.53 4 63.588 8 1.228 106.-160 127.212 431.022 Non-tax Revenue 10.546 10.78 1 10.997 12.891 15.200 1&.087 67.950 Grunts 12.376 16.-19 1 22.356 2·t 162 25.864 27.74 1 116.6 13 4 .2. G OV ERNM ENT EX PENI)ITURE Government developmental expenditure is determined by the fi nancial capacity of the country where the finance is collected from tax. non tax sources of revenue and official development assistance. Governm ent recurrent expenditure during the GTP will be based on the base year (2009/ 10) spend ing. the growth prospects o f the country in the coming yea rs and the assumption of a stable macro economy. Capital expendi ture during the GT P period prioritizes the financing of ongoing projects and investments on pro-poor sectors (such as agriculture and rural deve lopment. food security. water. education. health. roads. rural electrification. etc) that will help realize development policies and strategies set by the government and described in the GT P. By the end of the plan period. it is expected that tota l government spending will reach ET B 20 1.1 bin. up from its ETB 7 1.3 bin in 2009/ 10. ETB 78.9 bin of the expected 20 14/ 15 expenditure will be allocated to finance recurrent expenditure and ET B 122.2 bin to finance cap ital expend iture . By the end of the GTP period. expendit ure on poverty-oriented and growth enhancing sectors will reach ETB 146.8 bin. Ta ble 14. Projected gove r nment Expend it ures, Base Case Scena r ios (min ET B) Tolal h ems 2009/ 10 2010/ 11 20 11112 2012113 2013/14 2014 / 15 (20 10111 · 2014/15 Total Expenditure 7 1.334 92.049 106, 125 130, 187 161.-152 20 1.146 690.959 Recurrent Expenditure 32.0 12 40.046 45.224 54.3 83 65.-177 78.924 284.054 Ca pital Expenditure 39.322 52.003 60.901 75.804 95.975 122.222 406.905 Poverty Oriented Expenditures 47.251 60.682 72.165 9 1.13 1 116.245 146.837 487.060 Agr iculture and Food Security 6.99 8 9.5 18 13.123 15.905 20.302 25.699 84.547 Education 16.870 2 1.703 24.562 29.579 36.354 44.025 156.223 Health 45 47 6.260 7.027 8.796 1J.I 2 1 13.894 47.1)98 Road 14.601 17,304 2 1.752 28.762 36.5 8 1 45.898 150.296 w ater 4.235 5.897 5.70 1 8.088 11.888 17.321 48.894 In general. in order to meet the GT P objectives. a total of ET B 690.90 bln is required. out of wh ich. ET B 406 .90 bin will be used to finance capital outlays and the remain ing ETB 284.0 bin will be allocated to fi nance recur rent expenditure. In other words of the total 39 finance required during the plan per iod 58.5% will be spent on cap ital outlays and 41.5% on recurrent expenditure. (See Table 14 above)

4.3. F I NAN C I NG In 20091 10, the total government revenue was ETB 66.2 bin and the total expenditure was ETB 7 1.3 bin. The budget deficit. including grants, of ETB 5. 1 bIn was financed th rough borrowing from both domestic and external sources. The budget deficit of ETB 28.11 bIn at the end of the GTP period is expected to be financed from domestic (ETR 22.9 bIn) and external borrowing (ETB 5.2 bin). During GTP period a total of ETB 75.4 bIn budget deficit will be financed from domestic (ETB 50.6 bIn) and external borrowing (ETB 24.4 bin). Table IS. Projected Budget Ga p During GTP, Base Case Scenar io (in min ETB) T otal Item s 2009110 2010/11 2011112 2012/13 2013114 2014 /15 (20 1011 1 -20 14/15 Total Revenue Including Grants 66.2 37 79.806 96.94 1 118.28 1 147.524 173.040 6 15.59 1 Domestic Revenue 53.86 1 63.3 15 74.585 94.11 9 12 1.660 145.299 498.978 Tax Revenue 43.315 52.534 63.5 88 81,2 28 106.460 127.212 43 1.022 Non-tux Revenue 10.546 10.78 1 10.997 12.89 1 15.200 18.087 67.956 Grants 12.376 16.49 1 22.356 24. 162 25.864 27.74 1 116.613 Total Expendit ure 71.3 34 92.049 106. 125 130, 187 16 1.452 20 1. 146 690.959 Recurrent Expenditure 32.0 12 40.046 45.22-4 54.3 83 65.477 78.92-4 284.05-4 Capital Expenditure 39.32 2 52,(103 60.90 1 75.804 95.975 122.222 406.905 Poverty Oriented expenditures 47.25 1 60.682 72, 165 91,1 3 1 116.245 146.837 -487.060 Expenditure Dcflclt ind oGrunts -5.097 - 12.243 -9. 184 - 11.906 - 13.928 -28. 106 -75.368 Dcflclt Financing 5.097 12.243 9. 184 11,906 13.92 8 28. 106 75.368 External net 4.13 1 . L520 4.201 4.97 4 5.490 5.220 24,405 Domestic net 1.758 7.356 4. 983 6.93 2 8,438 22..886 50.59 5 Privatization 366 366 Proj ected expenditures presented in table 14 and 15 are based on the estimates of the medium term Macro Economic Fiscal Framework. In contrast, Table 16 presents expenditure requirements presented by impleme nting agencies. Thus. an amount of ETB 756,066 bin expenditure is estimated by the implementing agencies which exceeds by ETB 65.1 bIn compared to the estimate of the Macro Economic Fiscal Framework. Th is budget will be allocated in alignment with the government's fisca l policy and based on the sectors' annual plan and budget. The budget deficit from the perspectives of the resource need of the sectors during the five years period will be ETB 140.47 bin. (See Table 16 below) 40 Table 16. Resource need by Implem enting Secto rs , Bud get Deficit and Financing (in min ET B) Total Item s 2009/10 2010/11 201 1112 2012/13 2013/14 2014/15 (20 10/11- 2014 /15 To tal Revenue 66.237 79.lW6 96.94 1 11lU 8 1 147.524 173.0·1.0 6 15.59 1 Total E...pcnditu re Required 7 1.334 92Jl48 126.827 145.434 174.842 2 16.9 15 756.066 Recur rent Expenditure 32.0 12 40.04 6 54.046 6 \. 975 74.507 92.436 323 .0 10 Capital Expenditure 39.3 22 52.002 72.78 1 83.459 100.335 124.479 . 0 3.056 Poverty Oriented expenditures 47.251.6 60.6 82 86.243 10\.802 124. 139 156. 179 529.045 Agriculture & Food Security 6.998 9..5 18 15. 683 17.768 21.6XO 27. 334 9 1.983 Education 16.870 2 1.703 29.35 4 33.043 38.823 46.826 169.749 l lealth 4.547.6 6.260 8.398 9.826 11.876 14.778 5 1.U 8 Road 14.601 17.30 4 25.9lJ5 32. 130 39.065 48.818 163.3 12 Water 4.235 5.897 6.813 9.035 12.695 18.423 52.863

4.4. OFF B UDG ET FI NANCIN G O F I NFRASTR UCT URE A ND INDUSTRIA L PROGRAM S As shown in the followi ng tab les. the tota l financ ing requ ire ments of infrastructure a nd industria l deve lopme nt prog rams which will be undertaken off government bud get are forecas ted at ET B 569. 19 bin. The fi nan cing arrangements of these programs will be 30% from ow n so urces of development ente rprises and 70% fro m do mestic and exte rnal borrowing. Domestic borrow ing will be effected within the fra mewo rk of the govern me nt' s monetary policy and a stable mac roecono mic situation. External borrowing will be undertaken follow ing the national borrowing po licy. Of overa ll financing requ ireme nt indicated abo ve. ET 8 3 15.43 bin (55 .42%) is required in fore ign currency as ind icated in the follow ing tables. 41 Table 17. Off Bud get Financing Requirem ent of Infrastru cture a nd Industrial Developm ent Program s In ml n ETB S.N. SectorzSubsecter 20 10/ 11 20 11112 2012113 2013/14 20 14/ 15 Total I Industria l Development 16,229.67 5 1,954.59 56.728.13 42 .0~.96 26,59 1.73 193,561.08

1.1 Te xtile and Garment Industry 1.386.5 2,4 47. 1 3.6 11.6 3,484.6 5.0 15.6 15,945.4 ~~ ~- -~~-- ~~--~- ~-~~- --

1.2 Metal Engineer ing Ind ustry 32 1,454 5.780 9.600 3.600 20.46 6 - - 1.3_. Agro-Proc cssing Industry - 488.6 647.5 86 2.5 888 . 1 460 3,346.7 1.4_. Chemical. Pharmaceutica l and Ceme nt Indust ries - 473.9 8.740. 1 12.658 7.895.4 4.826 34.593.4 -1.5_ . Fertilizer Complex Ind ustry 75.99 3,282 .45 3.384.33 3,2 90.24 3.172 .0 1 13,205. 02

1.6 Leather and Leather Prod ucts Ind ustry 532.9 2.569 .4 2. 129.1 1.487.8 15 6,734.2 -- ~ ~ - - ~ - --

1.7 Micro and Sma ll Scale Ente rprises 2.909.4 3.354.3 336.4 0.00 0.00 6,600. 1 -- I." .~- Management and Privatization of Puhl ic Ente rprises 1.155.7 4.962.2 5.5 10.7 ~~-- 4.256.7 ~~---- 3.2 10. 1 ----- 19,095.4

1.9 Sugar and Associated Prod ucts Ind ustry 9.174 .68 24.49 7.54 22.455 .5 11.154.12 6.293 .02 73,574.86 --- 6.269.25 - _. Sugar Ind ustry - 9.00 8.6 1 24.265 .7 22.273.58 10.964.28 72,78 1A2 Resident houses of sugar indust ry 166.07 23 1.84 181.9 2 189.84 23.77 793,44 2 Transport 35,088 .3 43,22 3 41,795,4 30,550 . 1 11,04 7.7 161,704.5 2. \ -_. Rail 16.64 7 3 1.036 3 1.304 24.5 16 7.293. 1 110,796.1 2.2_. Ethiopian Airports Enterprise - 740 866 ,4 1.689.5 2. 174.3 72' 6, 198.2

2.3 Ethio pian Airli nes 14,942.76 8.425.74 6.246.00 1,307.43 220.4 1 3 1.142.35 -- 2A Ethio pian Marine Transit Service 775 1050 1.290 1.569.1 1.98 1.6 6,665 .7 ~~ --

2.5 Ethiopian Dray Port Se rvice 886.5 1.237.8 67\.2 336.7 143.7 3,2 75.9 --

2.6 Ethiopian Shipping Line 963.6 6 lO.8 552 .4 529 .7 530.3 3, 186.8 3 Co mmunicatio n 6,58 0 1,900 13, 190 0 0 2 1,67 0 , 3. \ Ethic-Telecom Energy 6.5 80 36,23 4 1.900 52,966 13. 190 29,219 29,658 0 29,658 0 21,67 0 177,735 5 Add is Aba ha Reside nt I louses Construction Project 2,640 2,640 3,080 3,08 0 3,520 14,960 Grand Tota l ( 1+2+3+4+5) 96,638.53 152,687.33 143,970.23 105,228.20 70,666.84 569, 191.10 Foreign Currency Requirem ent ( % ) 62.85 53.3 2 54.0 1 53,4 2 53.46 55,42 " Table 18. Off Budget Foreign C ur rency Requirement of Infrast ructu re & Ind ust ria l Developme nt Program s In mIn ETB S.N. Secto r/S ubsecter 20 10/11 20 11/12 20 12/13 2013 / 14 2014 /15 Total 1 Industrial Development 7,246. 19 22,582.26 25,29 7.96 2 1,873.89 14,659.7 1 9 1,660.0 1

1.1 Textile and Garment Industry 826,4 lA 5X.5 2, 152.5 2.076.S 2.997,4 9,511 .60 --

1.2 Metal Engineering Industry' 15.8 7 1X.3 2.855.3 4.742.4 1.778.-1 10. 110.20 - - ------------- ----- -I.J_ . Agro- Proccssing Industry 293.2 388.5 517 .5 532.9 276 2.008. 10 IA Chemical. Pharmaceutical and Cement Industries 499,4 6.244 .4 8.967.-1 5.657.4 3.524. 1 24.892 .70 -- -- - ----

1.5 Fertilizer Compl ex Industry 60 .79 2,625. 96 2,707.-16 2.632. 19 2.537.6 1 10.564 .0 1 --

1.6 Leather and Leather Products Industry 316 1.523.7 1,262.6 882.3 8.9 3.993 .50 --

1.7 Mlcm and Small Scale Enterprises 2.880.3 3.320.8 JJJ (I (I 6.5 34. 10 -- I., Management and Privatization of Public Enterprises 777.8 _- 3,339.6 3,708.7 2.864 .8 2. 160.4 12.85 1.30 -- ... - - -,-,-- --_ .._-

1.9 Sugar and Associa ted Prod ucts Industry 1.576.5 2.962 .5 2.793.5 2.485. 1 1.376.9 11.194.50 -- - - _. Sugar Industry 1.186.9 2.54R.6 2,484.1 2.228 .5 1.376.9 9.825.00 Reside nt Ilouses of Sugar Industry 389.6 4 13.9 309 .4 256.6 (I 1.369.50 2 Tra nsport 26,4 8!U6 28,247.1-1 26,781. 7 18,-178.63 7.25-1.9 1 107,24 7.75

2.1 Rail 9.48 8.8 18.6 2 1.6 17.2 17.2 13.483.8 4.0 11.2 62.8 22.60 --

2.2 Ethiopian Airports Enterprise J7 22.7 964.5 1.·130.3 4535 2.90R.00 -- -----

2.3 Ethiopian Airlines 14.942.76 8.42 5.74 6.2 46.00 1.307.43 220,4 1 3 1.142.35 -- 2A Ethiopian Marine Transit Service 750.6 6A 1.286 1.565.9 1.960.8 5.569.70 - --

2.5 Ethiopian Dray Port Service 422.6 671.8 547.4 195 .3 R4.7 1.92 1.80 - --

2.6 Ethiopian Shipping Line 843.6 498 .9 520 .6 495 .9 524. 3 2.883.3 0 3 Communication 4,700 1.,360 9420 (I (I 15,-180.00 Ethic..Telecom , 3.1 4.700 9420 15,480.00

1.360 (I (I Energy 22,27 1 3,0717 16,256 15,853 15,853 100,950.00 5 Addis Ababa Resident Ilouses Co nstruction Project 3·U 26.6 9.5 9.5 9.5 89.30 Foreig n Currency Require ment (min ETIl) 60,736 .75 82,933.00 77,765 .16 56, 2 15.02 37,777. 12 3 15,-127.06 Overall Financing Req uirement (mIn ETIl) 96,638.53 152,68 7.33 143,970.23 105,228.20 70.666.8-1 569, 191.10 Foreign Cur rency Requirement ( %) 62.85 53.3 2 5·U I 53.42 53.46 55.42 "

4.5. TilE ROLE OF TilE PRIVATE SECTOR AND Til E PUBLIC As pointed in the previous chapter, many development programs and projects are undertaken by the government and other development actors. Previous experience shows that the participation of the private sector, non-government organizations and the public at large in the deve lopment process has been significantly increasing. Accordingly, in the next five years, the private sector, the public and non-government organizations are expected to play a more active role and thereby significantly contribute to the success of the GTP. The contribution of the private sector, the public and non-government organizations is therefore included as one critica l element of the country' s overall capacity to finance the GTP. 44 C HA PTER 5. EC ON OM IC SECTO RS DEVELOPM ENT PLAN

5.1. A G RICULTU RE AND R URA L D EVELOPM ENT

5.1.1 Stra tegic Directi on Main focuses for ag riculture and rural deve lopment a re increasing the capaci ty and extensive use of labour, proper utilization of ag ricultura l land, taki ng account of different ag ro- eco logical zone s, linking specia lization wit h diversification, integrating agricultura l and rura l developmen t. strengthe ning the ag ricultural marketing system and effec tive implementation of the scaling up of best practices in the sector. Bear ing these strategic directions in mind. the Agricultural Development-Led Industrialization Strategy emphasise s that small holder farmers a nd pastoralists need to use efficiently availab le modern ag ricultural technologies that increase productivity and production. In addition. the private sector will be e ncouraged to increase its share of investment in agriculture. The remarka ble growth that has been registered to date will be further strengthened in the GT ? period . In order to expa nd Ethiopia' s export markets. initiatives will be put in place to increase penetration of international markets. During the GTP period. a key strategic direction is to ensure smallho lder agriculture becomes the main source of agricultural growth by scaling up interventions based on the experience gained. and identification of successes achieved in the previous plan period . Experience to date has shown that it is possible to increase the productivity of smallholde r farmers within short period of time by better utilizing smallholders' labour, land and by using improved but less ca pital inten sive agricultural practices and technologies. It is also the case that there is a grow ing demand for agriculture products because of growth in popul ation. growth in per cap ita GDP. increa sing international demand and growing de mand for agricultura l products as raw materials inputs to the growing industrial sector. These national and international realities j ustify the need for increased investment in agricultural sector to increase productivity and production. The results realised to date show that it is possible to transform subsistence agriculture to more ma rket led production . The key derivers of this c hange will be improvements in farmers' productivity and production. Thus, to lay the foundation for industrial development, to use agric ultural inputs for the industries. to prod uce sufficient food cro ps and high value products for international market. agriculture will continue to play a leading role in the GT P period . a) Sma llholde r Agricult ure Developm ent Sma llholder agriculture development will focus on the following three strategic directions. Sca ling up of best pract ices: The productivity of most average farmers is two to three times lower than that of best fann ers. Sca ling up of best practices to bring up the productivity of most average farmers closer to those of best farmers is the first strategic direct ion to be pursued during the GT P period. To realize this strategic d irection. public capacities at all levels, the agricultural extension services system and the skills of de velopment agents will be strengthened. Although the key direction is efficiently and effectively ut ilizing ava ilable tec hnologies and practices adopted by model fanne rs through sca ling up strategy, continuously bu ildin g technological capacities is also importa nt. Thus intensifying use of good agricultural practices, adoption of new tec hnologies by farmers and pastoralists will be encouraged. To ensure agricultural growth is susta inable. capacity to adopt and utilise new and proven technologies will be continuously strengthened. New technologies will be 45 deve loped and tested and, where results are encouraging, will be disseminated to farmers and pastoralists. Expa nd Irrjgatlon Developm ent a nd Improve Na tura l Resources Co nse rva tion: Accelerated and sustainable agricultural growth will be secured by natural resources conservation, development and improvement of water utilization, and expansion of irrigation coverage . These areas will remain focus areas during the fi ve yea r plan period and will include develop ment of underground and surface water, irrigation development and natural resource conservation. These in turn entail capacity building for farmers and of govern ment support structures. Production of high value cro ps: A further implementation strategy is a focus on improving the incomes of farmers and pastoralists. Farmers and pastoralists will be encouraged to shift gradually from production of low value to high value products. This strategy will be implemented gradually and will take accou nt of geographic d ifferences on specializations and existence of favourable market and infrastruct ural factors. b) Pastoral Developm ent Activities implemented in pastoral areas main ly focus on livestock resource. In that sense priority is given to water developme nt adequate both for the local community and livestock. Th is activity will be implemented in relation to the improve ment of pastora l land irrigation deve lopment. Activities related to food security will be implemented main ly in connection with infrastructure developments. In areas convenient to irrigation development, resettlement of pastora lists on voluntary basis will be another task to be undertaken. Identifying, selection and d issemination of improved livestock breeds will be strengthened, and improved mob ile veterinary services will be given. At local levels. emphasis will be given to increasing the number of professionals and strengthening their capacity so as to enable them give support to pastoralists. To benefit the pastora lists from their livestock wealt h, marketing system will be improved. Thus standard livestock centers will be built, pastora lists will be encouraged to organ ize themselves into coope ratives. To implement these activities close support will be given by the government. Extension systems will be strengthened; research centers will be expanded in a way to adopt appropriate technologies that give solut ion to local problems. Generally all possible measures will be facilitated to expand the exte nsion system integrated with the pastoralist livelihood. c) Private Secto r Agricultural Development Agricultural development policy explicitly states that private investors can partici pate in the nation' s agriculture development endeavours. As a result of the effort s exerted to implement this policy success has been realised in the floricultu re. The participation of private investors has been minimal in areas where extensive agriculture could be practiced, but where physical infrastructure is weak and, as a result, the govern ment has been investing more in basic infrastructure in these areas. Where infrastructure has been expanded in rural areas the increase in private sector investment has gradua lly increased. The increase in demand for raw agricultural inputs for the growing industrial sector has also encouraged private investment in the sector. Infrastructure improvements have increased interest in investments in agriculture from abroad and domestically. In the five year plan period. more effort will be made to improve and increase the role of the private sector in the agriculture sector, in lowland areas where land for large scale commercial farming is in demand. In addition, in the highlands and areas close to maj or cities, private investment will be steered towards high value horticulture 46 products that can be produced on limited land. using abundant labo ur (thu s gene rating significant employment) as wel l a s inc reasing supply of produ ce for export. Thi s type of private investm ent will requ ire co nsiderable expansion of basic infrastructure and a plentiful supply of labour. These investments will be integ rate d with smallholder agr iculture and help to provi de susta inable mark et s for sma llholder fanners. 5.1.20bjectins The broad o bject ive of agr iculture and rura l dev elopment in the next five-years is to ac hieve accelerated and susta ined growt h that contributes to povert y eradication an d achievem ent of MDG s. The exce llent results of. an d experiences gained from . the imp lem entat ion of ea rlier as we ll as o ngo ing programmes will support the att a inmen t of ag riculture and rura l de velo pment sectora l objec tives and of MDG target s by 20 15. During the plan period natu ral resourc es and so il co nse rvation. enha nced use of appropriate techn ologies and pract ices as we ll as market oriented prod uction will serve as the instruments to ensure rapid ag ricultural grow th. A focu s on export led product ion will co m pliment increased produ ctivity and ensure accelerated develo pmen t of the sector. Ag riculture wi ll co ntinue to be the maj or so urce of economic growt h whi le sma ll holder fa rm ing w ill be the major so urce of agricultura l growth . The private sector's ro le in the sector will al so be promo ted in order to sec ure sustai ned ag ricultural and rura l develop ment. 5. 1.3 Maj or Ta rgets Maj or ta rget s for agr iculture and rural deve lopm ent are indicated in the following table. T abl e 19. G T P T arget s for Ag ric ult ure a nd Rural Development Description of Target s [ 2009110 r 201 ·11I5 C u lt iva ted lan d I. Total cultiva ted land utilised b~' major foo d crops (mi n ha ) 11.25 12. 17 2. Prod uction of cereals (m in hal 9. 1 9 .6 3. Cereals prod uct ivity (qt/ha) 17 22 Coffee produ ct ion a nd p r odu cuvn y 4. Cu ltivated land by sma llho ldc r fa rmers (h a ) -162.000 8 15,000 5. Co tfe c production (tons ) 3-1 1.000 831.()OO Live stoc k d evelo pm en t 6. Cattle feed prod uct ion (qt s ) 50.000 1-15.000 7. Impro ved catt le bree ds (%) 10 .3 37 8. Product ion and distribution o f improved livestock gene (m in dose ) 0 .35 2 9. Proportion ofliv estoc k vacci nated (%) 40 65 10. Proportion o f low grad e hide s and skins (%) 50 IS II . Produ ction of impro ved animalfod der see ds (q ts) 50.000 1-\5.000 Ag rk ult u ra l in puts su p ply 12. Supply of improved seeds (m in qts j 0.56 3.6 13. Supply of chemical fertiliz ers (bo th IMP and Urea) (min tons) 0 .83 1.66 Ag r i{" ult ura l exte ns io n 14. Nu mber of be ne ficia ries o f agric ultura l extensio n services (mi n.) 5.09 14 .6-1 IS. U f thc beneficiaries of agricultural serv ices pro port io n o f women 40 and yo uth (% ) 47 Description of Target s [ 2009/ 10 I 201·ms Improving soil fert ility 16. Areas under Vcrtlsot development (mIn ha) 0.60 3 17. Acidic land treated with lime (ha] 22 10 37850 Nat ural Resource Co nservatio n Prcgrum 18. Area of land rehabilitated (min hal 3.2 1 10.21 19. Land developed under comm unity based water shade developme nt 3.77 7.78 program ( min ha l 20. Tota l area of land subjected to soil fertility research (min hal 0.894 2.82 2 i. Tota l area of land covered with forest and with forest master plan 0.70 2.20 (m in hal 22. Area of land covered with mult i-purpose trees (m In ha] 6.06 16.21 23. Forest coverage (mIn hal 13 18.23 24. Inc rease multipurpose trees ( ha) 5062 10154 25. Natura l resources conservation act ivities in pastoral are as {hal 200 ,000 350,()OO Sma ll scare Ir riga tion Progra m 26. Land developed under small sca le irrigation (m In ha) I 853 I 1850 Food sec ur ity 27. Number of households participate in safety net programs (mIn) 7. 1 1.3 28. Food reserve (min tones ) 0.4 1 3 Agriru llural Marketing 29. Coffee export (to ns) 172.2 10 600.970 30. Coffee expo rt earnings (mIn US!) ) 528 203 7 3 i. Increase expo rt earning of oil seeds (m in USn) 358 11 20 32. Increase expo rt ear ning of pulses (min USn ) 129.86 882 33. Increase the export of oilseeds (tons) 299.\98 n-U 16 34. Increase the export of pulses (tons) 225.446 1.120.98 1 35. Increase the live anima ls exported (n o.j 333.7 43 2.353. 000 36. Meat expo rt (tons) 10.\ 80 111.000 37. the a nimals and meat expo rt earnings (min USn) 125 1000 ". 39. Earning from flowe rs export (min US!) ) Earnings from export ofvegetable. herb and fruits (min USD) 170 3 1.7 535 948 40. Earnings from export spices (mIn USD) 18.57 30 4 1. Export of spices (tons) 15.594 34.240 42. Export of gums and incense (tons) .U 70 10.233 43. Export earnings from gums a nd ince nse (min USD ) 12.68 33.43 44. At the end of the plan period it has been planned to generate usn 6.5 8 bln from the agriculture sector e xport market by exporting 3. 81 mln ton of agricultural products. 5859 min flower c uts and 2.35 mIn live animals. Ceoperatfve Development 45. Number of primary cooperatives 33,636 56,9()4 46 . Number (If coope ratives unions 2 12 546 Ag ric u lt u ra l R esea rch At the end of the pla n period new technologies de velopment rn cereals. liv estock. so il. fore st developme nt a nd agr icultural mecha nizatio n wil l reach 265, 140.41 ,219 a nd 836 . resp ective ly Description of Target s [ 2009/10 I 201·ms Private I nvest m ent in th e Agricultural Secto r 47. Prod uction co ffee and tee and other ex port c rops (mIn to ns) I 0.251 I 1.8 I 48 . Transfer nearly 3.3 min ha land to commercia l fanning investors in transpare nt and acc ou ntable manner Hertlcunure Development 49. Land area und er fl owers production (h a ] 1.5&6 3.()()0 50 , Flower prod uction (mln c uts ) 2.748 5.859. 1 5 1. Lan d unde r the production o f vegetables. fruits an d herbs (ha] 2.472 33J)(1O 52. Prod uction ofvegetables. fr uits and herbs (to ns ) 58.400 979.600 5.1..1 Implementation Strategies a) Small holder agriculture The major implementation strategy for agricu lture and rural development in the GT P five year period is to scale up the best practices identified to date. Agricu ltural technologies that proved to be viable and beneficial, when tested by model farmers, will be transferred to other fann ers as quickly as possible and the design and capacit y building activities necessary to implemen t this strategy will be undertaken . Cr op production and productivity: As a result of the perfo rmance in agriculture and rural development. and the experiences gained, many of the condit ions that are important to accelerate agricultural growt h have been identified. It is possible to increase the productivity o f smallholder fann ers within a short period of time. by better utilizing smallholders' labour, land and with the efficient use o f ava ilable technolog ies as well as introduction o f improved agricultural practices and techno logies. To ensure in particular effective scaling up of the best practices the extension system will be continuously improved. while the capacity o f extension agents will be continuously strengthened. Adequate moisture areas: In areas with adeq uate moisture the focus during GT P implementat ion will be on the scaling up strategy. Successful experiences, such as efficient ways of utilizing rain water and use of beneficial technologies. together with improved agricultural practices. will be expanded to increa se crop product ion and productivity to the highest levels possible. The core element of the scaling up strategy is to extend those improved agricultural technologies and practices that have been tested and used by model farmers to all othe r fanners. To put these into pract ice, and overcome the constraints that ar ise while doing so, continuously improv ing the exte nsion system, strengthening capacity building, organisational and support services will be important. The main mechan ism ado pted to implement the sca ling up strategy will be to bring together best experiences accord ing to technology types. Th is formulation process will be continuous as additional best experiences emerge during the implementation process. When improved tec hnologies and agricultural practices are identified, training to introduce and improve skills will be provided to development specialists and farmers at farmers training centres and demonstration farms. Where technological problems are identified. app ropriate measures will be take n to resolve and replace them with workable solutions. Solving att itudina l and skill related problems can develop a stronger commitment to and demand for technology. For this reason. measures will be taken to have an adequa te supply of technology to meet the demand created. Appropriate adju stment measures will be taken to fine tune the system of technology inputs to the sca ling up strategy. A transparent , efficient and effective agricultural marketing 49 system will be put in place in order that market capac ity meets increased production following the scaling up strategy. Implementation age ncies and professionals will, at diffe rent stages, have to use best/model farmers' in the training process so that practical experiences are shared in a learning process. To ensure the benefit of experience is transferred effectively, the support of specialists will be provided by the extension system. At the end of the plan period, it is expected that, as a result of these measures, of those farmers who participate in the scaling up program, 90% will record productivity results that meet the model fanner benchmark. In order to increase crop product ion and product ivity, technologies and practices that improve soil fertility will be encouraged. Parallel to an increased use of chemical fertilizers. government will introduce activities to create aware ness and deve lop skills to increase the amount and coverage of organic fertilizer use. In areas where mo isture is adeq uate modern, drainage methods will be introduced in orde r to get full benefit from Vertisols. Steps will be taken to gradually change the existing blanket fertilizer application system to one based on soil fertility testing that identifies d ifferent agro-eco logical areas, soils and suitability for maj or crop types. The aim is for 90% of fertilizer use to be preceded by this type of procedure and thus increase benefits from fertilizer application. In addition, action will be taken to increase distribution and use of organic fertilizers, such as bio-fertilizers, that can easily be used by farmers. In adequate moisture areas, in order to increase crop production and productivity, improved agricultural practices will be applied. These include: the selection of crop varieties suitable for the soil type, adequate and timely farm preparation, use of the right planting time, the right quality and quantity of the planting input, and modern planting/sowing practices. In order to increase crop production and productivity, implementation of appropriate weeding frequency is considered important. Continuous assessment of pest infestations will be conducted, and measures taken when there is an infestation. Emphasis will be given to harvesting, storing and using matured crops in places and conditions where the crop is not exposed to pests. While giving appropriate focus to the use of rain water, actions will also be taken to bring about significant change in water use by expanding the area of irrigation schemes. In places where it is easy to access underground water, fanne rs will be supported to construct hand dug wells, and use them for production of garden vegetab les and permanent crops. Spec ial attention will be given to small scale irrigation schemes developmen t. Technologies that improve access to and use of water resources will be widely encouraged and applied . The combination of scaling up the lessons learned from best farmers with increased irrigation is expected to double agricultural product ion. Other interventions will be integrated with these implementation activities, such as Vertisol drainage and development of double cropping systems based on Vert isols. Tec hnology multi plication, supply a nd distribu tion : Expansion of the use of technology and of its' supply and distribution systems is crucia l to increased crop production and productivity. For this reason, during the GT P period, improved technologies will be applied to ensure the supply of the required quantity and quality of fertilizer, improved seeds, and small farm mach ineries. Na tura l resources man agemen t: In areas with adequate moisture, appropriate conservation practices will be scaled up. During the GTP, soil and water conservation works will be implemented using organ ized community participation , in those areas where such works are required. Forestry development, protection and utilization works will be carried out in a similar way. 50 Livestock resources deve lopment: Livestock development is expected to be promoted along side the scaling up strategy of crop production in areas with adequate moisture. The focus will be on the expansion of livestock fattening and da iry development technology. Improved technologies for honey production and poultry resources deve lopment will also be introduced. The success of these technologies will require strengthening of support for breed improvement, pasture deve lopment and animal health . In the case of cattle breed improvement a strong focus will be given to artificial insemination breeding techniques and the implementation of better local breeds' selection and distribution. Because both improved and existing breeds become more productive when they receive adequate and balanced feed, homestead pasture development, improvement of grazing land. use of forest hacks. and development of pasture crops for zero grazing. will be undertaken. Focus will also be given to preventat ive animal health services such as the provision of vaccination services (before incidence of disease), additional capac ity for vaccine storage, training adequate animal health specialists, and expanding service delivery faci lities, including mobile services. In adequate moisture areas, based on the principles of specialization. adequate support will be provided to farmers through the extension system to enable them increase the product ion and product ivity of high value products. Extra focus will be given to production of coffee, sesame. cotton, spices, vegetables and fruits. Broad support will be provided for preparation and formulation of packages to sca le up outstanding experiences, and for the completion and expansion of these in order to increase the productivity and quality of outputs and to ensure farmers realise increased incomes. Research-exte nsion-fa rmers linkage: Strengthening the linkages between research, extension services and farmers is essential to the wider use of improved technologies and practices. Help for farmers' to absorb technology, scaling up use of improved technologies, and support for the technology distribution and operating systems will be further reinforced. The research-extension-farmers councils that are coordinating this initiative at different levels will be strengthened in their capability and capac ity to identify technological problems, to promote joint solutions. to identify appropriate mechanisms and to become more results- orientated. Initiatives to identify. test. produce and disseminate new technologies will be introduced. These initiatives include research on crop, livestock. natural resources and agricultural mechanization. Supply of new technologies will include the importation and adaptation of existing proven technologies and their local production. Another initiative will involve application of modern research techniques aimed at shortening the time it takes to supply technology for irrigation. Moisture deficit areas: The government strategies for agriculture deve lopment interventions in moisture deficit areas will take into account what is necessary for adequate moisture areas. Some of these strategies are to enhance the development agents and farmers' skills, strengthen the organisational capacity of the extension system, and focus on the scaling up of outstanding experiences. The necessary work will be done to multiply technologies suitable for these areas and to supply and distribute the same as well as establish a comprehensive input and marketing system. Appropriate efforts have been taken earlier to tack le problems related to moisture deficit. These include identification of suitable technologies and practical tests to determine their performance. During the GTP period, the major focus will be to use these tested technologies, where appropriate. more extensively. Where there have been interventions in watershed 51 deve lopment that produced outstanding results, such as soil and wate r conservat ion works, these will be repl icated. Natural resources intervention s will be extended to all moisture deficit areas and can result in rapid rehabilitation, emergence of springs from the wate rshed basin and use of the resources created for irrigation purposes. Depend ing on the agro-ecology, soil type and slope of the area, different technologies will be put in place. These may include various types of stone and soil bunds as appropriate, wate r retention structures, erosion protection technologies and ridge s, enhanced moisture retaining technologies, deep trenches, ponds, tie ridges and flood channels to divert rain water for use on farms. Natural resources development and protection practices are labour intensive and enable activities that use peop les' labour in beneficial and product ive ways. When individuals, households or communities contribute labour it wi ll always be on a vo luntary basis. The safety net program will be used in these cases, following the approach of commo n asset development for the watershed develo pment works as designed. The maj or benefic iaries of nat ural resource development and protection interventions will be the peo ple and comm unities who will also be the owners of the facilities provided and users of the developed watershed in their locality. In particular, implementation will ensure that yout h and wome n are well represented amo ng participants and beneficiaries of such initiatives. One of the results to be ach ieved from watershed develo pment in moisture deficit area s is the augmentation of underground and surface water. To th is end, the dow n stream watershed will benefit from irrigation and supplementary irrigat ion deve lopment and use. By this means. moisture deficit area s problems can be solved wh ile, at the same time, practices that increase productio n and ensure food security are put in place. In moisture de fic it area s. through introduction of various technologies for harvesting and holding rain wate r, it is possible to produce crops once in a year. To this end , moisture retaining works will be widely implemented. Wate r retention holes will be dug within and around far m plots to ensure the success of th is approach. Adeq uate production will be ensured by co nstructing and covering wate r harvesting ponds using a geo-membrane, making tie-ridge s on farms. building water and moisture retaining works. Adequate moisture will be maintained and productive cropping will enabled by diverting flood water to farms. In moisture de ficit area s, small ruminants, honey bee and poultry develop ment wi ll be wide ly integrated with the waters hed develop ment interventions. In th is regard special emphasis will be given to sheep and goat production. Production of feed for these anima ls will encouraged together with the wate rshed deve lopment interventions and by selecting from indigenous breeds and using ava ilable exotic breed s and mult iplying them, productivity wi ll be enhanced. In order to prov ide health care for these animal s. vacc ine services wi ll be provided, and contro l services provided for external parasites and d iseases such as midges. When bee keeping is integrated with wate rshed development. beekeeping will become a more extensively practice and honey produc tion increased at the household level and through youth and women associations by introducing and supplying modern beehives. Improved poultry breeds will be supplied to farmers to help increase their income. One initiative for livestock resources development in pastora l areas that will be given em phasis is the selection and d istribution of local breeds for breed improveme nt purposes. Anima l hea lth services, including mobile services will be expa nded, and the number and capacit y of experts to de liver services will be increased. Natural resource management will be an important component of agricu ltural development in pastora l areas. 52 The Food Security Program has been implemented in moisture deficit areas known for their food insecurity problems. The program has experience with household asset building, safety net, and settlement programs, as well as with off -farm income generating activities and with the relationships between and integration of these activities. The safety net program will be implemented jointly with the household asset building program. Th is is beca use it helps so lve natural resource degradation problems, which in tum are a cause of the food insecurity problem, and because it helps to build community assets. For these reasons, efforts will be made to increase the programs effec tiveness. By targeting those safety net beneficiaries who are involved in the household asset building component and by giving them support for business plan preparation, training, technology supply, credit and extension services; the program will be better able to ensure their food security. In the household asset building component, packages of support that are based on the food security strategy will be formulated . The packages will include those which are suitable for moisture deficit areas and that ensure food security in low moisture areas, such as water harvesting. The settlement program compo nent of the Food Security Program was designed to ensure rapid food security. It is car ried out on voluntary basis and is an alternative option available to households. In addition, those households that have very small plots, and land less youth and women, will be encouraged to engage in non-farm income generating activities. They will be provided with adequate support to ensure their food security by providing packages of skill and business management training. credit and access to markets. The early warning system will be strengthened. Early warning of disaster and capacity building for the response to disasters will be key tasks over the GTP period. Ensuring a timely response to disaster will be included as part of agricultural support and eco nomic deve lopment strategies and programs. In terrns of preparedness for d isasters, food and non- food reserves will be increased with storage capacity built to meet the increase, particularly of food security reserves. b) Pastoral de velopment: The livel ihood of pastoralists is intertwined with livestock resources. Improving pastoralists' livel ihood is inseparable from the development of these resou rces. Consequently, the main emphasis will be given to water resources development for livestock and human consumption. This initiative will be undertaken together with improvement of pasture land and development of irrigation schemes. This approach has been tested and proven successful in Fentalie, and as eff orts are already being made to expand the approach to Somal i, Afar and SNN P Regional States, it will be wide ly expanded in the five year plan period. The Food Security Program, when implemented in pastora l areas, will be introduced such that they bring abo ut complementary community investments and there by promote sectoral development. For example, in areas where there are rivers, undertaking river diversion work or, where there is underground water, drilling boreholes need to be implemented. Water resource s released by these investments will be made ava ilable for livestock and human consumption, as well as to deve lop irrigation schemes and improve pasture land. Together with these activities, voluntary resettlement programs will be executed that enable pastoralists' to establish settled livelihoods. Natural resource management will also be an important component of agricultural development in pastoral areas. Breed improvement by exte nsive implementation of better local breeds' selection and distribution will also be given attention and animal health services will be improved through expanding mobile veterinary service provision. training of adequate animal health specialists and strengthening the institutions. 53 In order for pastoralists to benefit more from livestock resources, focus will be given to the expansion of livestock marketing system. Adequate livestock markets will be provided and the existing markets improved. Animal transportation systems and market price information systems will be strengthened. The pastoralist extension system and research centers that address the technological needs of pastoralists will be strengthened. Pastoralists will also be encouraged and supported to voluntarily orga nize in to cooperatives so as to address their marketing and other challenges. Efforts will be made to integrate the mutual benefits realised by pastoralists and domestic investors involved in ancillary services such as stock fattening, abattoirs and cattle trading. In addition, government support will be provided to private investors for investment in pastora l areas in, for instance, slaughter houses and quarantine stations that meet the required standards. c) Private sector investment in agriculture Horticultural developm en t: Cluster based deve lopment that has deve loped in selected areas around horticulture export ventures, particularly those supported by greenhouse technology, will be strengthened. Measures will be continuously taken to address the three maj or problems of the sector: marketing problem, logistical constraints, and transport limitations. These problems will be addressed in co llaborat ion with actors in the sector. New land with basic infrastructure will be identified and held in a land bank for new development clusters. Recognising, the expansion and increasing viability of farms in the vicinity of Addis Ababa, arrangements will be made to encourage similar cluster format ion and economic integration around other major cities. In orde r to minimize initial investment cost, favourable conditions will be put in place to produce green house facilities, irrigation pipes, etc. Efforts will be made to increase the participat ion of Ethiop ian investors in hort iculture develop ment and integrate them with farmers engaged in horticulture production in d ifferent areas. Actions will be taken, where necessary to encourage livestock breeders and seed suppliers in the country, increase the number of horticulture investors, input suppliers and service providers within the sub-sector, and promote and encourage the aims of these activities. In the five year plan period, smallholder far mers will be encouraged to participate in an out- growers scheme for production of exportable vegetables, fruits, spices and herbs. The scheme will adopt a rigorous monitoring and eva luation system that includes pre- and post production benchmarks and standards, and include human resources development that provides support from experts with practical skills and knowledge. Large scale fa r ming deve lopment: Large scale farming will be undertaken by private investors in lowland areas where abundant extensive land ex ists will be expanded and given due attention, in the next five years. The necessary arrangements will be made to increase private investors' participation by identifying areas that are not inhabited but are suitable for agriculture. Exploratory studies will be conducted to determine which forms of agricultural production enterprises are most suitable for each area identified. These areas and the data concerning them will be registered and organised in a land bank. An efTect ive land administration system and implementation agency that ensure transparent and accountable land leasing and land use will be established. The government will encourage investment in suitable areas identifie d by enabling local and external investors develop using lease system. The necessary support will be given to encourage the participation of Ethiopian investors. Efforts will be made to attract foreign investment in a manner that will be beneficial for Ethiopia 's agricultural sector development. In order to make the areas identified suitable for investment, essential infrastructure service will be provided and supply of transport. Labour supply will be mobilized from labour surplus areas. Fo llow up inspections of land use will be made and investor support services provided. 54 Every effort will be made to ensure private investors receive etlicient services from government. While supporting private investment in large scale farms, government' s focus is to ensure that the products from these farms are primarily for export or raw materials for domestic industries. For these reasons, emphasis will be put on cotton , date palm, tea, rubber tree and similar types of crops. Double cropping systems of production will be encouraged. d) Agricultural Marketing: A shin in the attitudes and production processes of farmers and pastoralists from subsistence to more market driven production has started to occur. This involves a change in attitude and life style and a new focus on internationa l markets. Farmers and pastoral ists will be helped to shin gradually from the production of low to the production of high value products and to ensure that their incomes increase as a result. The transformation of the agricu ltural sector, especially in terms of rap id agric ultural diversification and comme rcialization, must be complimented by an effective marketing system. Modern agricultural marketing systems, such as the marketing practiced through Ethiopia Commodity Exchange, will be strengthened. Initiatives that contribute to improving the agricultural marketing system include identifying and expanding best practices of model farmers, improving the quality of agric ultural products, strengthening monitoring and support systems at all levels, improving market infrastructure and the agricultural marketing information system, building the capacity of the market actors, and strengthening the capacity and participation of cooperatives. During the GTP period the primary markets will be effectively linked to the Ethiopian Commodity Exchange system so as to create an integrated and efficient marketing system. To improve the agricultural marketing system a number of initiatives will be taken in GTP period. The experiences of best small scale farmers will be clearly identified and be scaled up from kebele to federal leve l. Quality control of agricultural products will be put in place and the marketing system established. A strong monitoring and support system from regional to kebele level will be put in place and will serve to ensure the integration and performance of the market. Primary markets will be established and strengthened. Market infrastructure will be provided and market promotion strengthened so as to identify and penetrate new markets and increase the share in existing markets. An agricultural marketing information system will be established so that information can be delivered to users on a timely basis. The capacity of the market actors will be enhanced, agricultural product qual ity ensured and proper standards set. Cooperatives will be promoted to play a significant role in the marketing system. The focus will in particular be on identifying the problems of ex isting coope ratives and thereby undertak ing measures that enhance their capacities. The government will work closely with private actors in order to address market problems of particularly certain items. In this regard the government will work closely with all stakeholders to rectify the market, logistics and transport problems observed in horticulture, live animal, meat and other crucial export items. e) Research-extension-farmers linkage: Strengthening the linkages between research, extension services and farmers is essential to the wider use of improved technologies and practices. Help for farmers' to absorb technology, scaling up use of improved techno logies, and support for the technology distribution and operating systems will be further reinforced. The research-extension-farmers councils that are coordinating this initiative at different levels will be strengthened in their capability and capacity to identify techno logical problems, to promote joint solutions, to identify appropriate mechanisms and to become more results-orientated. 55 Initiatives to identify, test, produce and dissem inate new technologies will be introduced. These initiatives include resea rch on crop, livestock, natural resources and agricultural mechanization. Supply of new technologies will include the importat ion and adaptation of ex isting proven technologies and their local production. Another initiative will involve application of modern research techniques aimed at shortening the time it takes to supply technology for irrigation. t) Buildin g th e capacity of impl em enters The scaling up strategy triggered to achieve a meaningful increase in smallholder production and productivity is discussed earlier in this chapter. The initiatives involve improvement of soil fertility, implementing improved agricultural practices, technology multiplication, and improved supply and distribution. To successfully implement these initiatives, building the capacity of all the implementation age ncies and individuals is a decisive issue. Support to the agricultural sector will be strengthened in terms of the effectiveness of huma n resources. operations and organizations, at all levels. The development agents who provide spec ialized services direct ly to farmers will be helped to increase their skills and mot ivation. Clear procedures for how they can access suitable short and long term training will be put in place. To provide for those areas where development agents are not adequate in number, the Agricultural Technical and Vocational Educat ion and Training colleges will train additional development age nts in the areas of agriculture development, an imal health and cooperat ives. In order to increase farmers' motivat ion, their technological skills and ability to deploy improved agricultural practices will be improved. This initiat ive will use the outstanding practices of model fanners' via practical training sessio ns and materials at farmers' training centres. A simple fanners' extension serv ice that enables transfer of model farmers' experiences, such as development groups, will be used as a preferred experience exchange approach. T he farmers training centres as one of the agencies that will be responsible for enhancing farmers' skills will be expanded and those which are fully operationa l strengthened by increased support and equi pment provision as well as by setting up organ ized demonstration farms. 5. 2. I NDUSTR Y To ensure faster and sustained development of the industrial sector, favourable conditions will be created for industry to play a key role in the economy. To this end, particular emphasis will be given to two main sub-sectors. First the main strategic direction will be to support expansion and development of micro and small enterprises. In addition. efforts will be made to further develop medium and large scale industries. 5.2. 1 Strategic Directions Agricultural Development Led Industrialization is the fundamental building block of industrial development in Ethiopia. To support th is key policy, the private sector will be promoted so that it can play a more significant role in sustaining eco nomic growth. The government' s industrial development strategy states that ensuring accelerated and susta ined industrial development is a fundamental policy direction. To implement th is policy, the sector's development strategy focu ses mainly on industries that are labour intensive, have broad linkages with the rest of the economy, use agricultur al products as inputs, are export- oriented and import substituting, and contri bute to rapid technological transfer. In other words the key strateg ic d irect ion of industrial development will be micro and small scale industrial development. a) Micro and small enterprises development: This will be the strateg ic focus of the industrial develo pment during the GTP period. During the plan period an 56 environment conducive for the emergence of new MSEs and support that increase the productivity of the existing MSEs will be put in place. This strategic direction will enab le the development of broad-based and competent private sector. The expansion of MSEs in urban areas will also result in large scale job creation and thereby poverty reduction. The development of MSEs is also critical for strengthening sustainable rural-urban and urban-to-urba n functional and economic linkages. The expansion of MSEs is crucial too for sustaining the rapid growth being witnessed in the agricultural sector. b) Medium and large industries development: particu lar emphasis will be given for the following medium and large scale sub-industries: I. Textile and garment industry, 2. Leather and leather products industry, 3. Sugar and sugar related industries, 4. Cement industry, 5. Metal and engineering industry, 6. Chemica l industry, 7. Pharmaceutical industry, and the 8. Agro-processing industry, c) Industrial zones development: based on their feasibility industrial zones that are suitable for establishing medium and large scale manufacturing industries will be deve loped. d) Public enterprises management and privatization: The capacity and management of public enterprises as we ll as privatization will be enhanced.

5.2.2 Objectives The development objectives for the industrial sector are to I. Create a broad-based spring-board for competitive dome stic industrial and private sector development; 2. Create employment opportunities and thereby reduce poverty; 3. Support sustainable development of agriculture; 4. Increase industrial production and productivity by fully utilizing the existing capacity of industries; 5. Promote medium and large industries that use domestic raw materials labour; 6. Create a strong foundation for the sector to start playing a leading position in the national eco nomy, employment generation, and foreign exchange earnings and savings; 7. Strengthen the sector's capacity to produce locally equipments, machinery and spare parts.

5.2.3 Major Targets To achieve the object ives described above, the following targets have been set. a. Mi cro a nd Small-Scale Ente r prises MSEs Develop ment is the key industrial policy direct ion contributing to the envisaged structural transformation of the economy. The overall obj ective and key government policy d irection for this sub-sector is to expand the quantity and quality of micro and small scale 57 enterprises. Major targets to achieve this objective and implement the policy direction are presented in the following table. Ta ble 20. GTP Ta rge ts for Micro and Small- Scale Ente r prises Description of Ta rgets 1. Provide comprehensive support to micro and small scale enterprises so that they create employment opportunities for about three min people. Achievement of this target will enhance citizens' income. contribute to a rise in domestic saving. and enhance the benefits of women and youth from the sector so as to reduce unemploymcnt and poverty. 2. Provide Training of Trainers lilr 10.000 professionals in the sub-sector. 3. Provide capacit y building and basic skills training for about 3 mIn operators in the areas of entrcprcncurships. technical and vocational skills. 4. Prepare and develop 15.000 ha of land lor working premises. and const ruct shade and buildings for MSEs. 5. Provide micro cred it and marketing information and work with producers to identify bottlenecks and provide support where solutions arc ldcnrlfled. b. Medium and La rge Sca le Manu facturing Industries Brief descriptions of the objectives for each designated industry under medium and large scale manufactur ing industries are presented below. The targets during the plan period are presented in summary for all designated medium and large scale manufacturing industries in the table below. Textil e and Garment Industry: The object ives for the textile and gar ment industry include maximising utilization of existing production capacity. increased expo rt earnings. and increased investment in the sub-sector. This will be achieved main ly through the provision of support and by creating an environment conducive to the industry's development. Leather a nd Leather Products Indu stry: The objectives for the leather industry are to expand production of locally produced products, in terms of both variety and quality, as substitutes for imported leather products. increase foreign exchange earnings. and strengthen the technological capa bility of the industry. It is ex pected that these objec tives will be met mainly by the establishment of new investment proj ects. expansion of existing operations and by improving the production and productivity of the industry. Suga r and Relat ed Products Industry : A key object ive for the sugar and related products industry are to produce sufficient sugar production to meet the local demand of sugar product ion. Sugar and related products production will be expanded so as to support the supply of energy/power and other key economic activities. The contribution of the sugar industry to overall economic development will be increased as will job opportunities. For the effective implementation of the industry' s objectives. human resource development. institutional capacity building and relevant research and technological capac ity will be enhanced. Cement Indu stry: The objectives of the cement industry are to fully satisfy local demand for cement and create capacity to supply cement to the export market. Metal and Engineering Industry : The objectives of the metal and engineering industry are to enhance the industry' s production. quality and productivity, substitute imported products. build-up the design and manufacturing capacity of the industry as well as supporting other manufacturing industries. Table 21. GTP Targets for Medium and Large Scale Manufacturing Industries Descrilltion of 'Iexnfe and Ga r ment Indust ry, Targets 1. Raise the gross value of production ofthe textile and garment industry to usn 2.5 bin by the end of the plan period . 2. Scale up the prod uction capacity of the rcxtile and garment industries h)' an additiona l 90% during the plan period. 3. Raise foreign exchange earnings from the textile and gurmcm industry. by the end of 20 1 ~! 1 5 to US!) 1.0 bin. 4. Create new employment opport unities that contribute to the reduction of unemployment. for about ~ O.OOO citize ns during the plan period. Des{"rip.tion of Leather Indu stry' Targets R. Raise annual production of sugar and ethanol to 2.25 min tons. and 3 0~.OO() m3. respectively. and also generate 607 MW of electric power. by the end of the plan period . 9. Develop an add itional 200.000 has of land planted to sugar cane. 10. Generate USl>66 1.7 min foreign exchange earnings from the export of 1.246.000 tons of sugar. or which 623.()()Otons is rJW and 623.000 tons is white sugar. 11 . Raise sugar cane productivity to 155 tons per ha. by the end ofthe plan period. 12. Create additional employment uppon unltics for morc than 200.000 citizens. Descrilltion of Cement Industry' Target s 13. Raise the country' s total cement production capacity to 27 min tons (a day. month. annum) by thc end of the plan period. 14. Achieve an annual cement per capita consumption or 300 kgs. Descrilltion of :\Ietal and En gineering Indu st ~· Targets 15. Increase the gross value of domestic products of the industry to ETB 10 1.4 hln. 16. Raise the capac ity' utilization ofthe industry to 95%. 17. Improve annual per capita metal consumption to 34.72 kgs l R. By improving the product ion and techno logical ca pacity of the industry increase local production capacity of man ufactured parts and components for selected major manufacturin g industries.. namely leather. textile. sugar. cement. agro-processlng, construction and vehicle body industries 1090%. 35%. 85%. 85%. 75%. 95%. 85%. respectively. Chemical Industries Brief descriptions of the objectives for each designated industry under chemical industries are presented below. The targets during the plan period are presented in summary for all designated chemical industries in the table below Fertilizer Industry: The objective for this industry is to produce sutlicient fertilizer. using domestically avai lable raw materials, so as to meet the local demand for the product. Ca ustic Soda and Soda Ash Industries: The objectives for these industries are to establish the basic chemica l manufacturing industries. using locally available raw materials. sufficient to supply and satisfy the input needs o f other export oriented and prioritized industries. 59 Soap and Detergent Industry: The objective of this industry is to create suffi cient local capacity to wholly substitute imported soap and detergent products with local products. Paper and Paper Products Industries: The objectives for the pulp and paper industry are to create the capacity to substitute imported products with local products sector. Plastic and Related Products Industries: The obj ective of the plastic and related products industries is to substitute imported plastic products with locally produced products. Rubber Tree Industry: The obj ective of the rubber tree industry is to create the capacity to manufacture natural rubber locally so as to substitute wholly for imports of the product. Table 22. GTP Targets for Chemical Industries Des{"ription of Ta rgets I. One Fertilize r Indu stry ("o mlliu will be established to partially fulfillocal demand. 2. Ca ustic Soda and Soda Ash Industries Establi sh a caustic soda man ufacturi ng plant that can produce 50.0 00 IOns of caust ic soda per annum 10 meet fully the produce s local de mand 3. Ca ustic Soda and Soda Ash Industries Establish a soda ash producing plant that can produce 35.000 Ions of soda ash per annum to meet fully the produces local dcm and. 4. Soa p and Detergent Industry Establish new factories that can produce 166.000 tons of soap and detergent prod ucts. 5. Soa p a nd Detergent Industry By the end of 20 14/ 15. raise the capaci ty utilization of soap and detergent factories to 90%. 6. Paper a nd Pap er Pr oducts Industries Establish the capaci ty' to produce 4 10.000 tons of paper a nd 3 15.000 tons of pulp throug h new invest ment. by thc e nd ofthc plan period. 7. Paper and Peper Pr oducts Industries By the cnd of 20 14/15. raise the capacity utilization of the existing paper produc ing factories to 98%. R. Plastic and Related Pr odu ct s factori es. One plastic factor y will established to partia lly fulfi l the local demand and s ubstitute for imported plastic input s and products. 9. Rubber Tree Industry The target is to; Establish cultivation of 3.000 has of commercial rubber trees. and produce and supply 10.000 tons of natu ral rubbe r latex per annum with the invol vement and ownership of Rubber Tree Developm ent Nati onal Nucleu s Projec t. fa rmers. and investors. 10. Rubber Tree Industry Establish a processing plant producing 6.700 tons of tech nica lly spec ified rubber (TS R) annua lly. Pharmaceuticals Industry The objectives of the pharmaceutical industry are to create the capacity to produce essential pharmaceutical products that substitute for imported products and also supply export markets. Th is will be achieved by improving the utilisation o f existing capacity and the establishment o f new industries. Table 23. GT P Targets for Pharmaceuticals Industry J)es{"rintion of Ta rgets 1. To achieve full utilizatio n of the existing capa city of local pharmaceutica l and medical supplies manufact urers. 2. To ra ise the share of the domestic market held by local pharmaceutical and medical s upplies manufacturers to 50%. 3. To increase the expo rt earnings of pharmaceutical and medical supplies products to usn 20 min. 60 Agro Processing Industry The objectives of the agro-processing industry are to increase the productivity and capacity utilization of the existing industries. support and promote the establishment of new industries so as to increase the sub-sector's production both to local and foreign markets. Table 24. GTP Targets for Agro Processing Industry Desc ription of Ta rgets I. To raise the productivity of the beverage industry by increasing its capacity utilization to 90% 2. To generate usn 300 min from the export of agro-processcd products. c. Industrial Zones Developm ent The main purpose of developing industrial zones is to attract more investment and investors by providing land with essential infrastructural services and creating an attractive environment for investors. The initiative contributes to the overall economic development and poverty eradicat ion by creating emp loyment opportunities. enab ling increased exports and foreign currency earnings. and providing local goods that substitute for imported goods. Accordingly the GTP target is to establish at least 4 feasible industrial zones by implementing the following strategies. I. Solve the problems developers encounter in acquiring basic infrastructure services such as land. PO\\i'Cr. telecorn. road. customs. etc. in a timely manner. 2. Expand and strengthen training centres and institutions so that developers have access to a plentiful supply of skilled and competent human resources. 3. Assist developers and attract foreign investment to the industrial zones. 4. Cover 30% of the cost of providing basic infrastructure services such as water. telephone. power. roads. etc. d. Public Enter prises Management a nd Privatization A main obj ective of public enterprises manageme nt and privatization is to improve the operational performance of public enterprises and thereby increasing their competitiveness and effectiveness. In addition. the reform with regard to public enterprises management and privatization aims to increase export earnings. A high level of corporate leadership and management will be ensured. Feasible projects in areas the private sector is unable to finance will be established so as to rectify market failure and there by foster econom ic development. Table 25. GTP Targets for Public Enterprises Management and Privatization Description of Ta rgets I. To raise the value added amount from public enterprises 10 usn 5.32 bin and an overall growth rate of 19%. 2. For all public enterprises to achieve 100'% capacity utili.... ation. 3. To increase the prolhablllty of puhlic enterprises. before tax. to ETB 5.25 bin - an annual growth rate or 21%. 4. To increase export earnings of public enterprises to USD 1-10 mln.

5.2.4 Implementation St ra tegies Micro and small-scale enterprises: One of the strategies to be pursued in promoting MSEs development would be strengthening of the regulatory and policy environment such that the environment nurtures entrepreneurship and competitiveness. The promotion of MSEs 61 development will tak e into co nsiderat ion the d iffere nt stages o f development of the enterprise s. Accordi ng ly, the suppo rt pro vided w ill vary depend ing o n whet her th e enterprises are at sta rting, growth or maturi ty stages of development. Yet the strategy wi ll particularly e ncourage enterpri se s th at d isp lay entrepreneu rsh ip, and that are beco m ing mo re and mo re com petitive in the market. The seco nd implementing strategy concerns prom oti on of sav ings. Train ing and comp leme ntary suppo rt w ill be prov ided to encou rage savings a nd increase the capital ofMS E em ployer s and em ployee s. The micro cred it support system ce nter s aro und the use of o wn init ial capital a nd savings to start up a bu siness. To supplement this however, an accountable, efficient and tran sp arent mech an ism w ill be put in place to enable the prov ision o f credit to MSE s. In add itio n, mechan ism s wil l be put in place to he lp MSE s wit h access to production and ma rketing prem ise s to ease their cap ita l problems. Co nt inuo us tra in ing and awareness creation initiat ive s w ill be del ivered to MSE o wners to nurture the ir entre pre neursh ip. T here w ill be further ex pan sion of th e industria l extension service in urban areas to improve the pro duct ivity and co mpetitiveness o f MSEs. The TVETs will serve as skill and technology centers that suppo rt MSEs th rough technica l sk ill and e ntrepreneurship tra ining, tec hnology tran sfe r and improvement s, and business co unselling. The TVET w il l suppo rt MSEs by en su ring a good supply o f skil led labo ur th at will be integrated w ith the industria l deve lopment extension system. Govern me nt' s developmen t pro gram s wil l be desig ned in a supportive manner, to develop and imp rove capaci ty o f MS Es. Government will put in p lace supportive mark et mec hanism s such as ex port ince nt ives, link ing MSE s to med ium and large sca le manu facturi ng industries and access to agricultura l o utputs fo r MS E produ ct ion input s. Medi u m and la rge sca le manu fa ctu r in g ind ustries: Here too , o ne of the strateg ies is to strengthen the poli cy and regulato ry env iro nme nt for private sector deve lopme nt. By increasing tran sparency and eli m inating re nt seeking att itude s, Ethiopian e ntrepreneurs wil l be enco uraged to increase their investments in, and thus the produ ct ivity o f, med ium and large sca le ma nufacturing indu strie s. An env ironment conducive to increa sing the contri bution of th e ma nufacturing secto r to the eco nomy will be c reated by bui lding the capacity of Ethiopian investors to co llaborate wit h fore ign inve stor s. To increase the pool of adequate ly train ed hu man resources, foc us will be g iven in higher education a nd in TV ET to supply o f th e hu man resources w ith the knowledge and sk ills requi red by manufacturi ng industries. The res earch inst itute s w ill be further strengthe ned to support the productivity o f manufactu ring industrie s. Fore ign technica l support will be reorie nted towards strengthening leadersh ip and to enhance tec hnology transfe r and build capacity o f professiona ls. With regar d to land supply and services, an efficient and effect ive system w ill be put in place to pro vide serviced land at a n affordab le price fo r inve stm ent in ma nufac turing. Serviced industr ial zo nes w ill be devel oped . Industries that produce for the export market and prod uce goods that substit ute for imports wi ll be espec ially encouraged through provision o f better access to credit and other ince nt ive mec hanism s. T he efficiency of th e privat izat ion proce ss wi ll be furt her stre ngthened so as to tran sfer th ose state owned e nterprise s identified to the private investo rs. St rategies wi ll be put in place to ensure state o wned e nterprises o perate in a way that m inimi se inefficiency and imp rove profi tabi lity. Human and ca pita l resource ca pacities of do me stic investors w ill be enhanced to support expansion of indu strial and infrastructures development and pave the way for a n increase in co mpete nt domest ic investors and attra cts forei gn investor s. Other act ivitie s wi ll aim to att ract foreign inve stors to increase the ir investment in key ind ustrie s. Per formance identificat ion mechanism w ill be in p lace to identify those investors that pe rform we ll and are produ ctive. A mech anism w ill be put in plac e to ensure th e cross cutt ing sec to r issues in the development plan are integrated in the industry. 62

5.3. TRADE 5.3. t Strategic Directions The trade sector plays a significant role in sustained econ omic grow th in market-o riented eco nomic system. In the co ming five years, ra ising the etliciency and co mpetitiveness of the sector. strengthening domestic and fore ign investment a nd trade, eradicating rent seeking behaviours. establishing a favourable env ironment for produc tive investors. promoting a competitive and efficie nt domestic trade and distribution system, ensur ing co nsumers' rights. strengthening co nsume r' s coo peratives. and strengthening the transparency, fairness and accountability of the legal fram ework for trade activities will be the main strategic direct ions of the sector.

5.3.2 Objectives The main o bjectives, for the sector a re to e nsure mode rn and fair trading practice s, to improve the transpar ency and fairness of the instit utional and orga nisationa l fram ewo rk for trade o perations. Emphasis will a lso be given to intensifying international trade and improv ing domest ic marketing sys tems by strengthe ning con sumers' co operatives and supporting access to viable market o pportunities.

5.3.3 Major Targets Introduce fundamental change to improve trade registration and licensing sen/ices : At all levels of trade adm inistration, a uniform and harmonized system of trade registration and licensing will be esta blished to inte rnatio nal standards . The trade registration and licen sing system will ensure fair and transparent tran sactions, easy access to services and focu s o n the professional e ffic iency and co mpetency of services provided to the business co mmunity. Support consumers' rights and security by improving the regulatory framework for trade: To provide an effect ive and enabling regu latory framewo rk for trade, appro priate controls will be put in place that improve the role that the business community plays in ensuring fa ir competition and identify so lutions to preve nt ha rmful pract ices. Increase the benefits accruing to Ethiopia from international systems governing trade relations and negotiations : The a im is to better integrate Ethiopia into the multilateral trading system so as to broaden the benefit s from market opportu nitie s and increase investment flows. Strengthen the marketing system for domestic products : The ta rget a ims to increase product ion and ex port diversificat ion; esta blish an integrated domestic market ing system and strengthen expo rt development through creation of an integrated ma rketing system. Str engt hen the capacity of cooperatives: The target will ai m to strengthen the institutional framework a nd improve the human resou rce ca pac ities of coo perat ive s.

5.3.4 Implementation Strategies Introducing fundamenlal change in trade registration and licensing services: By rev ising the regulations that have been applied to date, a more fai r and e fficie nt service will be esta blished. The trade registration and licen sing aspects of the new regu latory frame work will o blige the business community to give accurate information about the ir busines s ope rations. The information prov ided will be sto red in a d igital data base. In addit ion, criteria go verning professio nal e fficie ncy will be adopted by the public agenc ies co ncerned with trade. Proclamations and assoc iated regulations will be prepar ed and en acted that, am ong other purposes, provide fo r the granting of trade perm its and facil itation of improved implemen tation processes. 63 Ensu re co nsumers' ri ght and security by enha ncing trad e regulations: Ensuring the existence of fair trade that affirms the consumer's right and benefit will contributes to accelerate d eco nomic grov..t h and social develo pment. With this focus, and on the basis of free market principles, a consistent system will be estab lished to ensure fair and efficient trade registration and licensing. and healthy and fair competition among the business community. Where harmful or illegal business practices that damage consumers' health. or reduce their safety. governmen t will con tinue to act in consu mers' interests. To this end, consumers' associatio ns will be organized and supported logistically, with finance. technical support and human resource development; the overa ll aim is to ensure consumers pay a fair price. These strategies will help to ensure that consumer association s play a positive and beneficial role in regulating prices. On the other hand. the legal and regulatory framework to minimize conflict betwee n the business community and co nsumers will be established and implemented. Cond itions that would facilitate to en sure benefits fr om trade relations a nd negotialions: A key implementation strategy is to integrate the country into the multilatera l trading system. Th is will be achieved by successfully comp leting the World Trade Organ isation accession process and strengthening regional trade integration with the inter-Governmental Authority on Development. Sana'a Forum. The Com mon Market for Eastern and Southern Africa (COMESA ) and the COMESA·East Africa n Community-Southern African Development Community Tri partite. The purpose of these act ions is to transform the trade negotiation process to a higher level of effect iveness. A further task is to. conclude the Economic Partnership Agreement with European Union. Finally. bilatera l trade relations and negotiations will be improved with all parties where mutua l adva ntages are identified. Sirengihening dome slic p rod ucl markelin g system: Implementation act ivities will focus on integrating domestic product marketing systems, increasing production and exchange coverage and strengthening export deve lopment. The domestic product marketing system will be strengthened with the object ives of ensuring fair, transparent. participato ry and cost effective transactions as well as fair prices. Support will be given to promote exports. build capacity. develop better use of information technology and develop access to finance and logistics. These activities will be planned and carried out in co llaboration with all stakeholders. Sirengihening and supporling coo pe ra tives' capacity: The problems of existing cooperat ives, and of establishing new cooperatives, will be thoroughly studied and conc lusions implemented. Coo peratives will be supported with capacity building, information technology development, acce ss to finance and logistics developments and strengthening of organisational and man power capacities. 5 .4. M INING 5..... t Strategic Direclions For the mining sector, the government' s main focus is to create a favourable environment for private investors for exploration and development of mineral resources. Among othe r initiatives. the gove rnment will co llect, analyse and interpret basic geo-science information for potential investors. Policies. laws and new regulations that create an institutional framework conducive for the development of the sector's contribution to the eco nomy will be put in place during the plan period. Paramount importance will be given to ensuring this institutional framework is enab ling. encourages co mpetition and takes account of the international situation and nat ional interests. Increased private investment in exploration and exploitation of high value minerals will increase the opport unities for finding additional depo sits and the foreign currency earned by the country. 64 5....2 Objectives Mineral exploitation holds enormous importance for agriculture. urban deve lopment. industrial development. construction. energy and othe r economic sectors. T he core objectives for the sector in the plan period include estab lishing accurate estimates of and utilis ing the reserves of minera ls that contribute to increased agricultural production through improving so il productivity. An additional area of focus is land exploration. identifi cation and utilization to determine water quality and quantity for domestic consumption and irrigation. Exploration to ident ify minerals whose exp loitat ion will substitute for imported minerals will be carried out. For construction and industrial sector inputs. exploration for and exploitation of go ld. platinum. tantalum and high value gemstones and other minerals will be initiated. These actions will also help increase foreign currency earnin gs. Exploration and exploitation of clean and renewable geothermal reso urces will take place. Substitution of mineral imports by increasing the volume and types of minerals produced by large and small scale licensed operators is a key objective. Artisanal miners will be promoted. so as to increase production significantly. by improving the mining methods and facilitating access to mineral markets. Speci fic objectives for geo-scie nce data and mineral exploration are to improve the gee - science data coverage o f the country. provide geo-scie nce data to international standards and that meets the needs of investors. 5....3 Major Ta rge ts The mining sector targets for the plan period are presented in the following table. Ta ble 26. GTP Targets for the M ining Secto r Descrtptlon of Ta rgets 2009110 I 20 l·fIl S I. Increa se cove rage (of the cou ntry] o f geological related marmine a nd studies as follows aj Geologica l mapping coverage at a sca le of 1250.000 (%) 51 100 b) Gravity studies coverage at 1500.000 scale (%) 8( ) 100 cj Geochemi stry & mineral potential map prepa ration & anomalous 2.7 4 areas coverage at a scale of 1100.000 (%) d) Air born geop hysics data coverage (%) 30 95 ej Gee-hazard studies coverage. at a scale of 1250.000 (%) 9.6 27. 1 f) Hydro- geologica l map ping coverage. at a scale of 1250.000 ( % ) 42.0 83.7 1 gj Detailed hydro-geological studies (km ) 3AOO 30AOO 2. Increa se evaluated and deli neated areas o f potential industr ial minera ls 4' 77 ex ploration. at a sca le of 150.000 (%) 3. Cond uct metallic mine rals exploration. eva luate potential at a scale o f 40 63 12000- 15000. a nd mise del ineated potent ial areas (%) 4. Det a il coa l/oi l shale ex ploratio n and po tential evaluat ion in ce ntral 12 20 Ethiopia. and increase delineated potential areas ( % ) 5. Co nduct petroleum exp loration. at a scale of 150.()OO. in the west 120.000 165.000 Ogade n basin. and inc rease cove rage (km1 ) 6. Increa se pre....dee p wcll d rilling geothermal detail study coverage. at a 6.2 6' scale o f 120.000 ('Yo) 7. Co mplete thc sha llow depth 3MW geotherma l energy exploration in 95 100 Tendaho (%) ,. Complete a deep well geothermal explorat ion. o f a s ite in Te nda ho 100''10 ca pab le o f produ cing 20 MW (%) 65 Description ofTa rgcts 2009/10 2014/15 9. Con tinue explorat io n o f 40 MW geotherma l e nergy sourc e for power 12. 5 100 supply in Al uro Langano (%) 10. Increase co untry-wide core dr illing ( 01) 7.00 n 16.000 I I. Increase wate r well drilling ( 01) 60(1 7.s00 12 . Incr ease geo thermal drilling ( 01) I o.ooo 20.000 13. A. benefic iation {crushin g and separat ing ore Into v a luable substa nces or waste by a vancty of techniq ues } test labo rator y wi ll be esta blis hed betwee n 20 10/ 1 1 - 20 13/ 14. and a fter tria l tests lo r 5 selected ind ustrial minera ls. a detailed bcncflcla tlcn test st udy wi ll be co nducted 14. Based on geosc iences Information collected. a 40 promotiona l doc ume nts will be produced to farnltlarlsc invcsto rs with poten tial sites for mineral exp loitation in the cou ntry, as a resu lt it will increa se from 4 in 2009! 1O til 8 in 20 14115 15. Achieve 1()O% ISO! 170 25 acc red itation for the Geosciences Labo ratory during the plan period The targets to be achieved by the end of the plan period for mineral and petro leum investment expansion. artisanal mining and marketing promotion. geosc iences and energy sector research and development are presented in the following three tables. Table 27. GTP Targets for Mineral and Petroleum Investment Expa nsion Desc ription of Target s 200 9110 2014115 I. Increase the volume o f mineral investme nt (mi n ETB ) 12.7 20 2. Increase re venue from royaltie s and other licensing ( mln ETB) 69 150 3. Increase annual reve nue from mining ta x (mln ETB) 230 250 ••5. Increase foreig n c urrency ea rnings from rmncratsrm!n USlJ j Increase the production o f go ld {Kgs ] 108 3.907 277.3 8.700 6. Increase the prod uction o f tantalu m (to ns) 202 300 7. Increase ex ports o f marble (m J ) 99.34 140 8. Increase investment in the petrole um sector ( min US IJ) 238 S38.7 9. Increase total number lice nses issued to petroleum cxploltetion sector 22 29 10. Increase number of lntcmatlon al e xtract ive indus try transpa rency 10 3 10 initiative s mem ber co mpanies . . II . Rcullsc cx pons u t 20 min lure s 01 mineral water. 12. Realise ex ports of I mln metric Ions o f p ot ash. 13. Realise foreign currency ea rnings of USIJ 1.36 bln fro m minerals and reso urces such as base meta ls and mineral water. 14. Make ready the Calub and Il iiaia gas fields for develop ment. 15. Enable 300.000 km 2 o rland to be categor ised as petroleu m provinces b) obtaining geo logical and geo physical data fro m the exis ting intern ational co mpanies invo lved in exploration. Table 28. GTP Targets for Artisanal Mining and Marketing Promotion Description of Targets 2009/10 2014/15 I. Increase gold purc hased by the National Ba nk or Ethiopia ( Kgs] 2.X66 5.250 2. Increase expo rts o f gemsto nes Kgs ) 3.100 ·t OOO 3. Increase the qua ntity nftan talum marketed (ton ) 63 90 4. Increase the number o f mining co-operative asso ciations 243 3S0 . GTP Ta rgets for Geosciences and Energy Sector Research and Development Desc ri r.tion of Target s I. Identify. select and su ppo rt abo ut eigh t need based and problem so lv ing research propo sa ls of grad uate stude nts. Descrir.tion of Targe~t~ ' 77"----:-:--:---:-:--:--:--:::-:------:-:---:--:---.. 2. Establish a nation al inventory and develo pment database for sclc ntiflc instruments and la bor atories in geosc iences and e nergy. 3. Develo p integrated gco-scicntiflc applications a nd initiate a study ofapproprialc re newable energy sources for the s ustainable develop ment of Addis Ababa and its surrounding areas. 4. Develo p integrated gee-scientific app lications and initiate a study of appropriate renewable energy sources for the sust ainab le development of Dire Dawa 5. Build increased capacity in scicnti tic instrume nts researc h and laboratory facilities that support the sector where they arc needed but not available. s...... Implementation Strategies Enhancing of Ceo-Science (lata Coverage and Quality: In this regard. the ptan is to improve the coverage of geo-science data required for development of minerals essential for agriculture. construction. ene rgy. manu facturing and develop ment of precious metals. In orde r to improve the quality of data investments will be carried out in the organizational. technological capability. standardization and human resource development. Mineral and Petroleum Investment Expansion : Specific implementation strategies for the expa nsion o f m inera l and petroleum investment include encouraging private investment in development of the sector. This will be achieved by improving the ex isting mining laws to make them more attractive to potential investors. study ing national and international minerals markets and providing adv ice to private investors where higher market demand is identified. Improvements in the cove rage and quality of data for mineral and petroleum development are expected to enhance investment in the sector. More importantly. investments in mining and petro leum exploration and deve lop ment will be guided by a comprehensive regulatory and policy framework that ensure transparency and accountability. Unde r ta ke ArtisanaJ Mining and Marketing Promotion: During the PASDEP five year period. the Ministry of Mines in collaboration with stakeholders. tried to promote artisanal mining and regulate illegal miners and smugglers by introducing new proclamations and d irectives covering exploitation of precious minera ls. Nonetheless. there are still a few miners and smugglers involved in illegal min ing and export of precious minerals. Their activities have serious negative social. economical. environmental and political impacts. particularly in the areas where they operate. The government is strongly committed to estab lishing a work ing environment conducive for art isanal mining and marketing promotion. As part of this commitment. a new proclamation No. 65 11200 1. which aims to reduce illegal mining. is currently being implemented. To achieve this. and to promote mineral resource development overall. the government will. in co llaboration with all stakeholders. use the exper ience it ga ins during implementation. and follow up on its regulatory and promotional strategies for the sector. Skill development. technical support and marketing supports will be acco rded to art isana l miners. Women are encou raged and specially supported to participate and accord ingly benefit from the sector. Under ta ke Geosciences and Energy Sector Research and Development: Implementing strategies for the geosciences and energy sector research and development support the mandate of the Ministry of Mines to estab lish need s-based research. training institutes and centres of excellence. With this in mind. the Ministry will undertake a research and development program across a broad range of geosciences and energy areas. to introd uce cutting edge and appropriate technologies as well as new methods. 67

5.5 INFRASTR UCT URE DEVELOPM ENT Provision of affordable physical and econo mic infrastructure. such as transportation, communication and energy makes a crucia l contribution to economic growth, em ployment creation. socia l we lfare and the expansion of the industrial sector. In the years prior to the GT P, a massive cap ital investment was made to expand infrastructure services. However, significant challenges have hindered faste r pace of infrastructure development. In addition to the high investment requ ired. the foreign exchange needs have constrained the provision of infrastructure to the extent desired. Inadequate dome stic human and organizational capac ity for infrastructure development has led to a dependency on foreign capacity, wh ich has in turn underm ined the pace and coverage of infrastructure delivery In the GTP period. very large investments will be made to further expand infrastructure services. to strengthen the foundation for long-term sustained growt h and development. and in doing so. the challenges encountered during the PASDEP implementation will be addressed and resolved. To date financing for capital investment has come from Treasury and Officia l Development Ass istance sources. To increase the financial resources available. emphasis will be given to improving the level of domestic savings and foreign exchange savings through promoting import substitution of imported materials and construction services with domestic products and services. Nevertheless. it is envisaged that domestic resources will still not be adequate to fully finance the infrastructure programs of the GT P. Import substitution of materials and construction services will help. but is not expected to fully address the foreign exchange constraints. Thus. the mobilization of external official deve lopment ass istance will be important in this regard. 5. 5. 1 Roads St rategic Directions Expansion of the road networ k is critical to the development of other key economic and soc ial sectors such as agricu lture. industry. mining. tourism. educ ation and health . Planning of road infrastructure must be integrated with the objectives. strategies and programs of these sectors. The success of development strateg ies of sectors depends on the efficiency of the transport sector in general and of the road sub-sector in particular. For these reasons, due emphasis has been given to the development of the road sector in the GTP. The gove rnment has recognized the importance of road transport in development of the national economic and social activities and hence attaches a high priority to improving the road infrastructure. as is reflected in the Road Sector Development Program which was launched in 1997. Objectives Object ives of the Road Sector Development Program are to expand the road network so as to improve access to rural areas. improve the quantity and quality of the road network overall. and develop the organisational capacity of the respon sible road agencies for effec tive management of road networks. Based on these objectives. road sector pol icy and strateg ies in the next five years are directed towards increasing effectiveness of all ongoing road sector deve lopment initiatives. improving the rural road network and connecting more or less all kebeles to all weather roads. Major ta rgets Based on the Ethiopian Roads Authority prioritizat ion criteria. the Road Sector Development Program consists of the fo llowing federal road targets: rehabilitation of 728 kilometer of trunk roads. upgrading of 5023 kilometer of tr unk and link roads. construction of 4331 kilometer of new link roads. heavy maintenance of 4700 kilometer of asphalt and gravel roads and routine ma intenance of 84649 kilometer of road network. In universal rural access program also construction of 11 2 12 kilometer of new rural roads by Regional Road Authori ties and construction of 71523 kilometer of woreda roads by woreda road offices will be undertaken . The government has envisioned connecting more or less all kebels to the nearby al l-weather roads as well as interweaving every major city by increa sing investment in road infrastructure. A summary of major road sector targets for each year of the five-year period are presented in the table below. Ta ble 29. GTP Target s for the Roads Sub-Secto r by Budget Year Descr-iption of Target s 2009/ 10 2010/11 2011/12 2012/13 2013/14 2014/15 I. Federal and regional total road lcngt ht km ) 48.800 5 1.636 54.8 18 58.2 11 6 1.771 ,-- 64-"" 2. Length of Woredas all-weather road ( km) 0 9.568 24.299 40.044 55.790 7 1.522 3. Kcbclcs connected to all-weather roads (%) 39 48 63 78 93 100 4. Average Time taken to reach nearest all- 3.7 3.0 2.3 1.9 1.6 1.4 weather road (hrs) 5. Area further than 5km from all-weather 64. 1 57.3 48.7 40 .9 34.3 29.0 roads (%) 6. Area furt her than 2km from all-weather 83.7 80.0 75.0 70.0 65.2 6 1.0 roads (%) 7. Road den sity ( Km/l .OOOkm2 ) 44.5 55.6 71.9 89.3 106.9 123.7 8. Road den sity (Km/l .000 population) 0.64 0.78 0.98 Ll 8 1.37 1.54 9. Roads in acceptable (Fair + Good) 81 81.3 83.0 84.6 85.9 86.7 Condit ion (%) 10. Number of Project operate d/carry (Jut by 58 61 64 67 70 73 dome stic contractors ('Yo ) II . Average vehicle Km oftravel (mIn km ) 9.6 10.1 10.6 11.1 I L7 12.3 Implementati on St rategy The implementation strategy focuses on restructuring of the implementing agency. capacity devel opment in the road sector. financing and safety measures. Accordi ngly the regu latory and operationa l arms of national road management will be split into independent organisations. In add ition the institutional framework and organisationa l capacity of the regio nal road agencies and woreda road bureau s will be strengthened. by. amo ng other means. human resource development . strengthening integrated road network planning. and improving the effectiveness of road maintenance. Other implementation strateg ies include actions to increase revenues of the road fund office, build the capacity of local contractors and consultants. introduce and expand usc of intermediate equipment technology in road construction, improve equipment ma intenan ce services. use alternative road project facilities. utilize labour-based and labour intensive approaches and technologies, and improve enforcement of axle load regulation. Lastly. improved environmental management systems and HIV/A IDS activities will be mainstreamed in all road projects. 69

5.5.2 Railwa y Transport Strategic Dire ctions Railway tran sport is a cost effe ctive and time effi cie nt mean s of carry ing bulk inputs and produce . Gi ven the rap id eco nomic growth in the co untry there fore co nstruction of a national rai lway net work has become an impo rtant task. To support th is strategic direction, the capacity of do mestic small and medium metal man ufacturing and enginee ring industries to produce sleepers, locomotives and ra il spare pa rts and input s fo r the railway network infra structure co nstructio n, wi ll be promoted . Takin g into acco unt the econ omi c advant ages of rai lway trans port, in the long term , it is planned to expand the network so as to co nnect the co untry with neighbourin g co untries and diff erent port s. To realize this long term strategic direction, in the short term . gove rnment wi ll mob ilise and build local ca pac ity (to provide se rvices as we ll as hum an resou rces) to expand the railway net wo rk. while also develop ing partnerships with forei gn actors. Key cha llenges in the ex pansion and de velopme nt of the ra ilway netwo rk refer to the e nor mous initia l investment. the human and othe r reso urce capac ity and spec ialised expe rience in ra ilway deve lopment requ ired. Strateg ies will therefore be devel ope d and impleme nted in o rder to mobilize domestic and foreign financ ial resou rces as we ll as build human and o rganizational capacity do mestica lly. Dur ing the plan per iod. due emphas is will a lso be given to the efficient a nd effective administration of the network and rail services . Objectives Th e objectives for the sub-sector are to build a natio nwide railway infrastructure network. devel op. and co ntinuous ly impr ove loca l capacities of ci vil engi neering co nst ruction companies and metal and electro-mechan ical industries, and maximise techn ologica l tran sfer useful to the sub-sector. Integrated within the se objec tives will. in most cases, be strateg ies to ensure that developm ent of rail way infrastruct ure is ope rationally susta ina ble. Major target s Th e ma in targets for the rail way sub-sector durin g the plan pe riod are presented in the following ta ble. Table 30. GT P Target s for th e Railway T ra nspo r t Sub-Secto r Descri~tion of Target s I. Construction ofa total of 2.395 km ofn atio nal railway" network. out ofwhich a bout 1807.9 km will be completed (Addis Ababa-Dlrcnawa-Dcwclc 656 km: Awas h- Woldiya - Mckclc 556.2 km: Wcldiy a- Scmcra-Gala fl 256.4km and Addis Ahaha-Ejaj i-Jimma- Bedcle 339.3 km). whi le efforts will be e xerted to construct the remaini ng 587. 1 km of network ( Mojo- Konso- Wcyto] . 2. Const ruction of 3-1 km of light railway network along two corridors (from east to west and nort h to south) providing the ca pital city Addis Aba ba with a mass transit system. This initiative will lnvol vean- Su companies working on des ign and construction of network and more than 20 man ufacturing companies producing spare purls a nd providing metal engineering and electro-m echa nical services Implemenlin g Stra legies To ac hieve the targets set fo r the rai lway sub-sector the key strategy co nce rns development of loca l capaci ties in the ra ilway networ k de velop me nt processes. Th is strategy will incl ude speci fic hel p for loca l metal man ufacturing a nd e lectro- mec hanica l co mpa nies to produce material s for railway network de velopment. A conducive policy and regulatory environme nt 70 w ill be created for the participation of private sector in the sub secto r. A public/private part ner ship fra mework and system w ill be designed fo r the sub-sector. Ado ption of di fferent rail design, constructio n and management methods is a further strategy , as is imple mentatio n o f study find ings o n rail way netwo rk co nstruction, service deli very and sec urity. The go vernment will adopt approaches and mechanism s that maxi mise use of the ab undant lab our ava ilable for the construction o f the railway network a nd will cre ate an enviro nme nt conduci ve for the establishme nt o f local tra in ma intenance co mpan ies.

5.5.3 Energy St rategic Ilirections The strateg ic d irectio ns du ring the GTP period are deve lopme nt of rene wa l en ergy, expansion o f energy infrastructure, a nd creatio n o f an institutiona l capacity that ca n effec tive ly and efficie ntly manage such energy so urces and infrastructure. Durin g the GT P period , the ga p betwee n the demand for and supply o f electric ity w ill be min imised . Per capita co nsumption o f electricity o f househo lds is exp ected to increase d uring the GT P period. Moreover it is planned to produ ce suffic ient elec tricity for export. The e lectric power supply coverage w ill be increased throu gh the on go ing rural e lectr ification access prog ram. Govern ment w ill ensure a cost effective, high q ualit y supply of energy, as we ll as energy e ffic iency and conse rvation. The regulatory fra mework wi ll be effectively enfo rced. In order to prom ote and rea lize the co untry's Gr een Develop men t Strategy, on go ing initiatives to ge nerate e lectricity from hyd ro power and ot her renewab le energy so urces like bio fuel s, so lar and w ind will remain the strateg ic d irections during the GT P peri od . In add ition new tec hnological innovat ion s w ill be ut ilized to ensure that the energy sub-sector' s doe sn 't emi t add itio nal ca rbo n-d iox ide. To prom ote and sustai n rural a lternat ive energy deve lo pment activities, efforts w ill be made to enhance the capac ity and knowled ge in this regard o f reg ion s, prod uce rs and consume rs. Th e d istribution o f wood sav ing materials and technologi es througho ut the co untry wi ll be co ntinued. Objectives The major obj ectives for the energy sub-secto r ar e to meet the demand fo r energy in the co untry by pro vidi ng suffi c ient and reliable po wer supply that meet s internatio na l sta ndards at all times. Th is obj ect ive will be achieved by acc elerating and comp leting the construction o f new hydropowe r electric ge neratio n proj ects, and stre ngthe ning the existing transm ission lines to provide improved access to rural villages a ll ove r the co untry. An additiona l object ive is to expo rt power to the ne ighbo uring countries. Mod ern iz ing the d istribution syste m wi ll also be considered , so as to redu ce power losses to inte rnational be nchma rk levels. Developm ent o f alterna tive e nergy from ren ewable so urces suc h as wind, so lar bioma ss, etc w ill be integrat ed with the co untry's Gr een Devel opm ent Strategy. During the plan period an o bjective is set also to transfo rm the nat ional ca pac ity in developin g and ma nagin g energy by rad ically reforming the nat iona l powe r co mpany such that the electric power supply services reach inte rnational sta ndard. Major targets Th e targets for the energy sub-secto r during the plan per iod are prese nted in the following tab le. 71 Table 31. GTP Targets for the Energy Sub-Secto r Description of Target s 2009110 201~1I5 I. Hydroelec tric power gene rating ca pac ity (MW) 2.000 10,000 2. Total len gth of d istribution lines ( Km) 126.038 258.00 0 3. Total le ngth of re habilitated distribution lines (Km) . 50 8. 130 ••5. Number Red uce power wastage (%) 11.5 5.6 6. of consu mers with access to e lectricity Coverage of elect ricity service s (%) ., 2.000.000 4.000 .000 75 7. Total undergro und power distr ibution system ( Kr n] 97 150 lm plementln g strategies The key implementation strategy is capacity building in energy develop ment and manageme nt. Thus the national electr icity co mpany will go through radical reform such that the national institutional capac ity to generate power. construct the infrastructure and efficiently and effectively manage the power and infrastructure shows fundamental improvement. Other implementing strategies that will be employed to achieve the above obj ectives and targets for the energy sub-sector are strengthening organisational implementation. capacity (the electric power company go through a complete restructuring process). increasing develo pment of electric power generation and access to services. strengthening regulation of electricity providers so as to ensure a reliable service. expanding alternative renewable energy product ion. increasing emergency oil reserves and ensuring protection of natura l resources. and enhancing community development. Gende r and .I IV IA I DS issues will be mainstrearned in all energy sector activities. Electric Powe r Generation Const r uct ion Program: Ethiopia has a potential to generate 45,000 MW of hydroelectric power. Ho w eve r. currently only 2000 MW is generated. It is planned to increase this level of power generated by four times. Implementation strategies are to promote a mix of energy sources by developing renewable wind and geothermal resources. prevent power loss and promote proper utilization of energy. reduce unit cost of power generation investments and operations. and provide elect ricity at affordable prices. Electrlciry transmission lines construction: To ensure a reliable electricity supply and transmit the electric power efficie ntly and economically to consumers. construction of a reliable distribution and transmission networks is essential. To this end. due empha sis will be given in the Universal Electrification Access Program to construct new transmission lines and connec t them to the national grid as economically as possible and to reduce power losses. Further implementation strategies are to minimize the cost of construction of transmission lines. improve control of power sources and construct additional transmission substations so as to achieve efficient power d istribution. Thc Power Ilistribution and Expansion Program will adopt implementat ion strategies to modernise the power distribution system with the aim of increasing service de livery efficiency. cost saving and reduction of power losses in the distribution system. Act ion will be take n to ensure availability of efficient. reliable. high quality and economical electricity services to consumers. improve power supply service quality. provide outreach facilities to new customers. and to reduce power interruptions and losses by expanding the network and maintaining d istribution lines. The Universa l Elcctrification Access Progra m will adopt implementation strategies that provide access to electric ity for rural towns and villages. commerc ial agricu ltural production. 72 and irrigation pumping. The program will be executed in close collaboration with, and ensure participation of, local contractors and manufacturers, technical and vocational school graduates, and other stakeholders. Electr icity is an essential part of the rural transformation agenda because it is an important input for businesses and productive enterprises in small to medium sized towns and as an input for agricu lture, irrigation pumping, commercial agricultura l production and processing. Equitab le distribution of services to the rural economy, agricultura l and other sectors development has a beneficial effect nationally. The national regulatory system to ensure conservati on of electricity a nd energy efficiency: Implementation strategies will seek to meet increasing demand for energy by encouraging private investors and government electric utilities engaged in the sector. Actions taken to support this strategy include licensing applicants and granting certificates of competence to potential energy producers. A further approach is to ensure that reasonable tariff' structures that are affordab le are applied. Energy audit activities will involve establishment of energy efficiency management sections for selected consumers, particularly high energy consuming organisations. A study of requests for annual tariff revision by developers will be carried out with the aim of establishing an economical and fair for electricity services, while at the same time encouraging investment s and its recommendations implemented following agreement and endorsement by the responsible authorities. Energy conservation and mitigation of energy losses will be pursued for each economic sector. The measures to be taken will identify the most efficient energy consumption technologies, establish performance standards, implement and conduct regular inspection activities on electric utilities, prepare reports and taking the corrective measures necessary. Bio-fuel developmen t: Ethiopia' s emissions of C0 2 are very low compared to deve loped countries. Nonetheless, access to a range of reliable, affordab le and clean energy sources is critical for sustainable growth. One of the potential means to realize the shift to more sustainable fuels is the product ion of bio-fuels and other renewable energy sources, as a part of Ethiopia's green development strategy. As stated in the bio-fuel development strategy, Ethiopia has suitable land for bio-fuel (bio-ethanol and bio-diesel) development. Implementing a bio-fuel development initiative, in line with country' s Green Development Strategy, will enable bio fuels to substitute for imported petroleum fuel and even sufficient for expo rt. Moreover, jobs will be created locally at different stages of bio-fuel production process and thus contribute to raising living standards. Action will be taken to expand bio-fuel plantations, introduce use of bio-fuel in households for cooking and lighting, standardize and refine information relating to land, technologies and markets for bio fuel development, and promote knowledge about bio fuel use in each region. Benefits of this initiative include, improvement of the country's carbon sink, reduction in deforestation, and reduct ion in the time spent on and burden to women and children in searching for firewood. Steps will be taken to involve investors and other stakeholders in bio fuel deve lopment processes. The Bio-fuel Development Program will implement strategies during the plan period to create a network of implementing agencies, research institutes and universities to adapt and promote sustainable development of bio-fuel technology. The network will co llect and organize data on bio-fuel land. technologies and markets. coordinate involvement of relevant stakeholders. support and motivate private investors' involvement in the bio-fuel development activities, involve farmers in production and supply of bio-diesel by co-coordinating the work of relevant extension services, and fac ilitate experience sharing with countries where bio-fuel deve lopment is at more advanced stage of development. 73 Alter na tive energy developm ent and p ro motion will develop e nergy resources a nd technology by adoption, adaptation or innovation of new designs. T his strategy aims to produce prototypes and test the efficiency of energy sources and technologies based on consumer de mand. Other alterna tive energy development and promotion initiatives are to work closely on energy resource identification and technologies with government agencies, NGOs and private companies and provide training for the business sector including manufacturers. Awa reness within communities will be created and promoted. Demand for alternative e nergy technologies will be improved and loans arranged for manufacturers and consumers to insta ll alte rnative technologies. Although, Ethiopia is endowed wit h a variety of energy resources, many of these resources have not yet been exploited. A study of efficie nt alternative energy resources and usages, and the means to e ncourage their development wi ll be ca rried out. Attenti on will be given in the study to environment protection a nd conservation. The study will involve co llaboration betwee n government, regional states, private sector and other stakeholders. Application of improved alternative energy technologies will help minimize deforestation, reduce indoor air pollution that results in health prob lems a nd save the time women and c hildren spend searching, collecting & transport ing fuel wood. As a result, fami lies will have more time for other productive work. By bu ilding the capacity for regional implementation agents and othe r stakeho lders' alternative e nergy technologies and resources will become more widely availab le to users, increase sustainable energy use and benefit communities. Ca pa city buildin g: The on-going program to strengthen the tec hnical and vocational skills of schoo l graduates, and of manufacturing industries relevant to the e nergy sub-sector, so as to build own capacity and reduce foreign currency needs, will be continued. Strateg ic pet ro leum reserve facility developm ent a nd operation: Being a petroleum importing country, the reliable and consistent supply of petroleum is essential for deve lopment of the Ethiopia' s economy. It is a strategic necessity for all oil importing countries to secure the ir access to o il; it must be ava ila ble continuously and it present and future supply must be sec ured. A number of facilities have been constructed made operational in prev ious years. Currently Ethiopia's strategic petroleum reserve ca pac ity is 369.800m3, which is a bout a two months supply. During the GTP period, development of the strategic petroleum reserve facility will cover all areas associated with deve lopment and ope rations. These include: the construction of storage ca pacity. maintenance of fac ilities for the sto rage of petroleum. o il acqu isit ion and transfer to storage and operational readiness activities such as d istribution of the stock to local commerc ial distribution systems. The current strateg ic petroleum reserve storage ca pac ity will be inc reased from 369,800m3 to 429,OOOm3 which provides for 45 days consumption . The c urrent strategic petrole um reserve stoc k of 87000 m3 will be increased to 429,OOOm3 which, as stated above. covers 45 day s consumption. Strategic petro leum reserve facilities will be maintained and the operational readiness of the strategic petro leum reserve ensured. The implementation strategies adopted for the strategic petroleum reserve facility include increasing the size of strategic petroleum reserve storage capacity, increasing the size of strategic petroleum reserve stoc k, a nd maintaining the strategic petro leum reserve facilities and the opera tional readiness capa bility. Pet r oleum do wnst ream operations sta nda rds & speci fica tions regul a tory pr ogr am : Ethiopia has been importing crude petroleum oil for many years. Previously, there was no official governmenta l agency with the responsibility regulate a nd manage petroleum down stream operations standards & spec ifications a nd provide transpa rent standards, spec ifications and manage ment. As a resu lt the country has lost large quantit ies of foreign c urrency and petro leum products. and as a consequence suffered contami nation and 74 environme nta l de gradat ion. Inspection of petroleum downstrea m usage is a new area for regulatio n and co ntro l. It is intended to ra ise regu lation and contro l to the international level. and provide e ffective monitoring and suffi c ient inspect ion ca pability. Serious attenti on wi ll be given to the ad dressed and resolve the prob lems. bui ld. extend and provide an e fficien t petroleum products supply and utilizat ion system. The impleme ntat ion strategies incl ude the preparat ion of direct ives, regulations. and technica l standards for the inspection and monitoring of petro leum downstream services. so that a ll the downstrea m bodies a re co vered by a n integrated law and regulatio n detailing standards a nd spec ificatio ns. The regulatory framew ork will ensure the qual ity and reliability of the services prov ided by petroleum downstream operators. Petroleum produ cts distributer wi ll be inspected to ensure petrol depots. transportat ion and distri bution fac ilities. including the ir constructio n and perfo rmance, fulfil international sta ndards. Systems wi ll be put in place to ensure that petroleum produ cts, fa cil ities. sto rage. tra nsportatio n and d istributio n meet proper industry standards .

5.5.4 Telecommunication Strategic Directions The strategic direct ions here are to ensure that the inform ation and co mmunication infrastructure a lready in place is effectively uti lized such that it provides higher q ual ities of information and co mmunication service s. In order to effective ly utilize the infrastructure and de liver higher q ua lity services at competitive prices the teleco m com pa ny will undergo radica l institutional reform such that its instit utional capac ity shows fundamenta l c hanges. In additio n. ensuring a secure IT system will be a strategic direction of the GTP. while development of the domestic ICT sector will a lso be accorded d ue emphasis. Areas of focus for the teleco mmunicatio ns sub-sector are to upgrade the ex isting lCT netwo rk to accommodate the latest info rmation technologies a nd improve network q uality and ex pand services. An a ll incl usive teleco mm unicat ion service de livery a nd ICT suppo rt where it is a req uirement of othe r deve lo pment program s will be put in place. The human reso urce capacity of the sector will be built. On going projects to develop the netwo rk will be fina lized. IT services availab le across the co untry. incl uding high q ual ity integrated te lecomm unicatio n services packages (co nverged val ue added services). will be provided. at a reasonable price. Fixed line and mobile telephone service provision will be e xpanded nat ion wide. To acco mmodate the latest info rmat ion co mmunication technologies. a ll telecom munication infrastructures will be digit ized. Th e inte rnet service ex pansion progra m will bene fit city go vernments. wo reda c ities, academ ic institutio ns. incl uding high schoo ls and unive rsit ies, research institutes. socia l o rganizat ions and the private sector. T he ongo ing net work expansio n program will be strengthened by building a high capacity fibre o ptic tran smission line and linking it through neighbou ring co untries to inte rnatio nal marine ca ble s. Thi s initiative will provid e the co untry's global digita l gate way. The o ngo ing com prehensive Universa l Teleco mmun icat ion Access Program will be ex panded and extended to incl ude add itiona l socia l services apart from its ex isting ca lling service. This will enhance the Program' s ro le in the implementat ion of develop ment strateg ies and plan s of other sectors. Teleco m ce ntres wi ll be bu ilt and those a lready o perationa l in rura l areas will expa nd the ir service s and be better integrated with leT and other program s. Deve loping a nd expa nding huma n resource s. espec ia lly for regulato ry tasks in the fast advanc ing and growing sector. is very important and has bee n given due attention d uring the plan pe riod. It is a lso important to en sure that the te lecommunication service is up to internationa l sta ndards and 75 where telecom resources are limited (for instance nat ional frequency spectrum. telephone numbers. numbers and internet provider addresses) that they are used fairly and economically. A further focu s is to ensure the security of the telecommunication service by combating illegal use of the network and transmissions of illicit content. Object ives The key objectives are to ensure a co mpetitive (in terms of prices and quality) and secure telecom services. and build a far reach ing national capacity in telecom development and management. Emphasis is on finalizing the construction of the on going network infrastructure and applications to expand services. A need based network may also be expanded. The rural universal telecommunication access program will be expanded and the quality of fixed line. mobile phone. internet and data service provision improved and maintained. An environment conducive to use of the latest telecommunication technologies will be created. A fair and economical utilization of national frequency spectrum. telecom munication numbers and internet provider addresses is ensured Illegal telecommunication activities will be prevented M ajo r Ta rgets The targets to be achieved by the telecommunicat ions sub-sector are presented In the fo llowing tab le. Ta ble 32. GT P Ta r gets for th e Telecomm unica tions Sub-Sector Descrlprhm of Targets 2009/20 10 20 14115 I. Number of fixedline tele phone subscribers (mi n.) I 3.05 2. Fixed line telephon e density (%) 1.36 3.4 3. Number of mobi le telephone s ubscribers (mi n) 6.52 .0 4. Mobile telephon e coverage ( % ) x.7 45 5. Number of Internet service subscribers (mIn) 0. 187 3.69 6. Ruraltclccom access within 5 km radius ofscrvlccs (%) 62. 14 100 7. Wireless tclecom service cove rage (%) <50 90 K. Global link capacity (G b/s) 3.255 20 Implementing St ra tegies Three key implementation strategies are identified. First. the national telecom company will be reformed such that it is transformed to have an institutional capacity that de livers high quality and com petitive services. The telecommunications provider will be fundamentally upgraded to meet international standards using the services of reputable foreign compa nies. The second strategy concerns the establishment and effective enforcement of comprehensive policy and regu latory frameworks to prevent and contro l illegal activities in the industry. An effective mechanism for control and prevention of illega l telecommunicat ion activities will be put in place to ensure telecommunications security. Finally. all initiatives in the industry wi ll be designed and executed such that they promote the domestic production ICT goods (inputs. components. etc .) and domestic del ivery of lCT services during the GTP period. A human resource ca pacity building program will be designed and implemented. Steps wi ll be taken to put in place better quality fixed line. mobile and internet services. Te lecom munication sub sector implementation strategies include design and implementation 76 of systems to prevent integrated system failure. and ensure its maintenance and improvement. measure network flow and quality. and customer compliance. The telecom service quality. network capacity and frequency spectrum utilization and control will be strengthened. Monitoring of rural kebeles' telecommunication services will be increased and an admin istrative assistance strategy provided and dissem inated. The quality and traffic capacity of service on internat ional lines will be improved. A strategy to raise additional funding resources for the sector will be deve loped. A strategy for capturing more customers via outsourcing. marketing and business will be designed and implemented.

5.5.5 Potabl e Wa ter Sup ply a nd Irrigation Developm ent St rategic Directions Priorities for water resources management will support ove rall GTP objectives for integrated and sustainable development. Sub sector specific priorities are to improve utilizat ion of water resources by interconnecting different sectors and users. ensure fair and equitable utilization of water resources taking into co nsideration existing demand and future generations' needs. The impacts of runoff. drought and other natural hazards will be mitigated. An integrated approach will be taken to water resource s development and utilization that gives due consideration to its security and safety as a resource on the one hand. while also considering fully the parallel needs o f resource usage such as water supply. development of irrigation. river basin administration. watershed management and related activit ies. An integrated approach to water resources manageme nt will take into account complementary natural resources and sectors such as agriculture. health. mining and energy. etc. Attention will be given to the contribution the water sub sector must make to achievement of MDG targets. Development initiatives will include water supply. irrigation and drainage deve lopment. a hydropower study and design. a surface and ground water study. an integrated master plan study and watershed management. Objectives The development objectives. during the GTP period. are to develop and utilize water resources to fulfil soc ial and economic priorit ies. sustainably and equitably. by increasing water supply coverage. and developing irrigation schemes that ensure food security. l\lajor Targets To meet the above objectives. during the GT P five year period. the following targets have been set for potable water supply and irrigation development during the plan period (and for each budget year. in the case of potable water supply). Ta ble 33. GTP Targets for Pota ble Water Supply and Ir rigation Developmen t Description of Pota ble water Targets 200912010 2014 /15 I. Urban po table water supply coverage within 0.5 km radius (%) 9 1.5 100 2. Rural potable water supply cove rage within 1.5 km radius (%) 65. X 98 3. National water s upply coverage (%) 68.5 98.5 4. Reduce non funct ional rural water supply sc he mes (%) 20 10 5. Irrigation Feasibility and design [ha ) 462. 114 1.208.448 6. Irrigation Co nstruction {hal 127.242.6 785.5 X2.6 7. Irrigation Rehabilitation {ha l - 6.570 77 Ilescription of Target s for Other Parts of the Water Sub Sector 2009/20 10 20t4/15 8. Pre- feasibility study on multipurpose hydropower projects 6447 9.227.4 (MW ) 9. Feasib ility and deta iled design on multipurpose hydropo wer 1.431 8.398.4 projects (MW) 10. Increase the ground water information and know ledge (at 3 22.7 150.000 sca le) mapping cove rage (%) II . Increase cove rage of national surface hydrology stat ions ( % ) 85.6 <J{J 12. Increased integrated rive r bas in man agement master plan (%) 25 63 13. Rehabilitate degraded and damaged land [ha} 1.000.000 14. Upgrade information prov ided at the sur face hydrology stations to internatio na l standard It is also estimated that. nat ionall y, a potent ial 01'5. 1 mIn ha ofl and can be deve loped through various irrigation met hods including, pump. gravity. pressure. unde rgro und wate r, wate r harve sti ng and other mecha nisms. Based o n this est imate o f potent ia l. irrigat ion devel o pment activities. part icularly sma ll sca le irrigation wil l be given priority in the plan period. Implementation St rategies The impleme ntation strategies for potable water supply are to en sure a dependable and susta inable water supply based on deman d and efficie ncy measures. Sustai nab le and feasible technologie s will be impleme nted to improve the rural wate r supply co verage. Active ma nagement and operationa l mechan isms of exist ing wate r faci lities will be ensured . Water eco nomy mea sures will be devel oped and imple me nted for existing water schemes and, before they are constructed for new sc hemes. Add itio nal imp lementation strategies will aim to satisfy water demand at the househo ld level while tak ing acco unt of the co untry's capacity. Th is strategy will use cr iteria based on socio-eco nomic c riteria to assure co nsumers of a n eq uitable and efficient distribution. a nd utilizati on o f the wate r in excess of the basic demand. A strategy wil l be pursued to prio ritize low cost schemes and projects that will be imp lemen ted through loan s. implement measures suc h as co st reco very in urban water supply. and bui ld capacity at all le ve ls of water resou rces management. The imp leme ntation strateg ies fo r irrigation and integrated water reso urces mana gement are. development of new irrigation schemes . co nstructi on sha llow a nd dee p wells for irrigat ion in area s rich in gro und water. faci litating cond itions for med ium and large sca le irrigatio n development (building dam s and related infrastructure), imple mentation tech no logies and mec hanisms that improv e efficient water usc in medium and large sca le irrigat io n schemes. and estab lishing and integratin g meteo rology and hyd rology services at a ll levels (from federa l to distric t o r wo reda) . Local resources. skills and knowledge in wate r resou rce ident ificat ion and utilizatio n will be enhanced. studies and research into trad itional and alternative low co st tec hnologies will be co nducted. and a ppropriate tec hno logie s deve loped.

5.5.6 Tran sport Services Stra tegic Direction s Other than deve lo pment of road transportation infra struct ure. strategic direction s that will be pursued will incl ude increasing the effec tivene ss of the tran spo rt system so that the cost of transportation decreases. T he private sector's capa c ity and role in service prov ision will be increased. The sub sector will be restructured a nd be ope ratio nally improved so that transportation services are more flexible. competent and provide o vera ll a more e fficie nt 7R service. The time rural people spend travelling will be reduced by providing all weather roads. thus giving them more time to spend on productive act ivities. Increasing economic activities in Addis Ababa. Dire Dawa and the main regiona l cities demand expansion of urban transportation systems. This in tu rn requ ires development of better transport systems and services. and mass transport infrastructure. Development of urban transportation systems wi ll be based on efficient urban land utilization and development planning as well as analysis of existing and future traffi c density patterns. One of the key challenges for urban transportat ion is an implementat ion capac ity gap and. for this reason. emphasis will be given to build the appropriate human resource and administrative capacity. Considering the relatively low vehicle density in the country. the number of traffi c accidents is very high. Preventing and reducing traffic accidents and the resulting loss of human life and property. is imperative and timely. Accordingly. an integrated traffic security and modern traffic management system. supported by informatio n technology. will be developed and implemented in all regions. Objectives A main objective of the transportation sub-sector is to ensure that the public transport system is efficient and affordab le so that the travel time of particu larly the rura l populations is reduced and they have more time for productive activities. A second main obj ective is that the urban transport system is effici ent. secured and well integrated. A further objective is to build the effectiveness of regulatory bodies by putt ing in place an improved legal and regulatory framework . An effective institutional framework will help to ensure private transport service provide rs are competent and provide proper standards of service. The human resource capacity for better management and service delivery will be deve loped. A national data base for freight and public transport will be created that will reduce the time processing admin istrative requ irements and the costs o f freight transport. Major Ta rgets For the GT P period. the following targets have been set for the transport services sub sector. Table 34. GTP Targets for the Transport Services Sub Sect or Description of Target s 2009/10 201 ·ms I. Increase the available scat km (hln) 25. S 32 2. Total dis tance cove red hy hUSl'S ( km) 70.0 ()O IOO.()O() 3. Daily moto rized transport supply o f Add is Ababa C ity 2. 162. 162 3.083.360 (passengers scats) 4. Public trans port supply coverage (%) 14 4K 5. Waiti ng time for public transport in A.A (minutes) 45 15 6. The average annual freight distance covered (km) SO.OOO 120.000 7. Tra me acciden t death rate ( per 10. non people ) 70 27 In addition. increase the avai lable national freight transport carrying capacity to a tota l ofl A trillion ton/krn, build 22 drivers' competence certification training centres (traffic complexes) cove ring all regions. reduce processing time by 20% by improving administration of the freight transport logistics system. and ensure that all rural kebeles have access to Medium Transportation Service (IMT). Starting from 20 1011 1 all vehicles will be requ ired to have th ird party automotive accident insurance. 79 Impl ementin g Stra tegies To ac hieve the above o bjectives and targets fo r the transpo rt services sub-sector. wor ld-class regulatory and service de livery sys tems w ill be introduced. Nat iona l logistics coo rdination exce llence and informat ion ce ntres wi ll be built. while spec ia lized human reso urce devel opment in road tran sport will a lso be given attentio n. A rural tran sportat ion expa nsion pac kage will be design and imp lem ented. An ince ntive structure fo r stakeholders who participate in the sub-secto r wi ll be created. Improvem en ts will be made to traffic ma nagement. An organ isat iona l system for control a nd integrat ion of public transport assoc iations will be developed ; it will include a system for co mmerc ia l companies to enco urage them to impo rt new a utomotives and to address the needs of those who need spec ia l assistance. A modern tra ffic flow o perations ce ntre with the latest information tec hnology will be bu ilt. A road safety co unc il will be co nstituted. operationa l at fede ral. regiona l and local levels. to initiate and coordinate road safety proj ects and programs and build a national road transportatio n data base.

5.5.7 Maritime Transport Stra tegic Directions A key focu s area du ring the GTP period is to enhance the ca pacity of the sub-sector for effic ient service deli very by building a maritime tran sport system that will reduce the time spe nt, cost of tra nsit logistics and processing of imports and ex ports. To this end. a multi modal maritime and sea transport at ion service deli very system will be put in place . Dry port ca pac ity will be e nha nced and co nso lidated while taking into acco unt the point of dep art ure for. and destination of. goods. In additio n. to further fac ilitate the impo rt-expo rt trade a nd speed up transiting of good s. the tran sit time of goods at sea po rts will be red uced. The number of control a nd we ighing stations will be red uced and the management of ve hic le uti lization in the co rridors increased in order to increase the frequ ency of veh icle travel and reduce tran spo rtation time. To provide an efficient and good qua lity service. the safety of import-expo rt tran spo rtation co rridors will be assured. A logistics system that is suppo rted by modern tech nologies wi ll be deve loped. Objectives In the GT P period the dry port infrastr ucture in the co untry will be expanded and enhanc ed. Impo rt-expo rt business o perations wi ll be fac ilitated by rea lising the mutua l econom ic benefits that can be ga ined through partnership with neighbouring cou ntr ies and improved utilizat ion of transit co rrido rs. to reduce the time and cos t of logistics in import-export trade. The national snipping line's carry ing ca pac ity will be enhanced. To support the fre ight transport service within the co untry. the local wate r transpo rtat ion service will be improved. l\l ajor Ta rge ts Th e GTP targets set for the maritime transport sub sector are presented in the follow ing tab le. Table 35. GTP Target s for th e Maritime Transport Sub Sect or Description of Targets 2009110 20 1·I/IS I. Increase gene ral cargo impo rts carried by the multi modal 2 SO transpo rt syst em ( % ) 2. Red uce transit time for impo rt and export goods (days) 30 20 80 Description or Target s 2009110 201 ·m s 3. Availublc scat kilo meter in local water trans portation (m in 0.9 1.4 ton) 4. Red uce trans it time lo r imparts and exports (days ) 30 20 5. Ex port ca rgo tra ns ported by the ne wly Improved syste m (%) 90 6. Ac hieve a sea port ut ilizati on for Dj ibo uti. Bcrbcra and Port Suda n. respectively (%) 60/30/ 10 7. Increase the capacity of Mojo an d Semo ra dr y po n s (for general cargo. excl uding 100 unpacked and liquid ca rgo) (%) 8. No. ofloading stations to be built a ll over the co untry during thc pla n period 35 9. Fuel tra nsported by Ethi opia n ships (b in to ns ) 3.6 Implementation St rategies To achieve the above targets for the maritime transport sub sector during the plan period the multi modal system will need to be fully implemented, while the capacity o f dry ports infrastructure facilities have to be enhanced. Part nership and co llaboration with the neighbouring countries is another important strategy for effective sea port utilization and regiona l integration. Improving the containerizat ion system is considered as one of the strategies for improving the sea transport and maritime services. The control systems at transport corridor custom checks will be improved. The freight transport and logistics program will be implemented. A local water transport utilization strategy will be de veloped and implemented. and related human resou rce capacity strengthened.

5.5.8 Air Transportation Services St rategic Directions The major focus for air transportation services is on further strengthening the competitiveness of air transport and expanding passenger and cargo transport services by creat ing new international destinations. Domestic air transportation service delivery will be expanded such that it supports the development of tourism activities in the country. Standardized cargo terminal and cooling systems at different airports will be built to facilitate the import and export trade of horticulture. meat and perishable commodities. The capacity of the air cargo system will be improved in order to enhance quality and affordability of the service. In addition. the ongoing construction of airports. at different locations of the country will be co mpleted; and their operational and technical standards brought up to required levels so that they del iver services at international standards. Lastly. an important focus will be to improve overall the capacities of the air transport system (of airplanes' carrying capacity. pilots. other professionals. airports and operators) throug h capacity development aimed at improving aviation safety and security. Objectives The objectives of air transportat ion services in the plan period are to develop the regulatory framework and services in order to build the capacity of the sector to reach the standards and levels of competitiveness of best aviation industries globally. That the aviation industry has fu lly competent and suffic ient human resource capac ities will be ensured as we ll as that the services delivered by Ethiopian Airports Agency. at the international and local airports it manages, arc up to standard. Local passenger flight services will be expa nded, while demand for international flight services will be met by upgrading and expand ing the services. The 81 import-export trade in the country will be supported by providing efficie nt and affordable cargo services. Airport security and safety facilities in ex isting and newly built airports will be fully maintained and navigat ion services provided that are standardized. secured and sustained. Major Ta rgets To achieve the above objective s for the air transportation sub-sector the target s for the plan period are presented in the following tab le. Table 36. GTP Targets for Air Tra nsportation Se rv ices Sub Sector Description of Targets 2009110 2014/15 I. International and domestic passenger (bin scats) 15.2 37.2 2. International and domestic passenger (min km travelled) 263 994 3. Passengers on internationalflights (min no.) 2.7 6.6 ••5. International Passengers on domestic flights ('(}(lO no.) m 14M passenger Ilight destinations (no.) 6. International flights capacity o f local airports (Regular and '" 45.0(){) 77 67.0(}O temporary) (no.) 7. Domestic nig hts capacity of local airports. (o f regular and 49.()()(J 72.()(}0 temporary) (no.) 8. Accommodation capacity for passengers of international 3.88 30.5 tlights all airports (min no.) 9. Accommoda tion capacity for passengers of localfl ights all 0.96 7.6 airports (mi n no.) 10. Local tlights coverage ('Yo) 16 20 I I. Cargo carried from all four internatio nal airports (tons) 11 9.()()0 3 11.0()(J 12. The number of operators/investors in the sector {no.] 21 35 13. Globally accepted fatal acciden ts rate (rutio} J O/ 1O.nOO 5/ 10.0()O Implem en tin g Strategies A national av iation capacity building program will be designed and implemented. Regulatory and service delivery systems wi ll be benc hmarked against internationally renowned aviation industries. Com munities' and regional gove rnment's participation in airport constructio n will be encou raged. A standard governing airport construction and standardized system of airport classification will be designed. New destinatio ns and flight program s will be opened. using market expansion strategies. New airplanes will be purchased so as to improve service qualities and efficiency, including local flights. Safety' and facilities' systems and civil aviation monitoring system will be operated to acceptab le international standards.

5.5.9 Urba n and Co nstruction Develop ment Though. the level of urbanization is low in the country the urban population is increasing. This is also expected to continue in the GTP period. On the other hand. urban administrations have started to provide urban infrastructure and services. revitalize their economie s and promote j ob creations in urban centers given their capac ity. In the GT P period. due attention will be given to enable urban centers to have adeq uate urban infrastructures. promote small businesses and jobs. and cond ucive environment that is equ itable with the dema nds of ever 82 increasing urban populat ion. These will turn help reduce poverty and unemp loyment in urban centers and thereby enhance the role of urban centers for accelerated economic development. The construction industry has registered significant growth in the past five years plan period. It played an important role in improving the delivery of social and eco nomic infrastructure, generating jobs and contributing to economic growth. To sustain this in the GTP period, and enable the local construction industry play its role in accelerated socio-economic development of the country, focus will be on building the capac ity and com petitiveness of the industry by implementing a comprehensive and integrated capacity building program. The legislation and enforcement of a regulatory framework that ensure safety and competitiveness in the industry is also considered crucial to GTP. Strategic Direction Key strategic areas for urban development are poverty and unemployment reductions, sustained and integrated development through rural-urban and urban-urban linkages, participatory engage ment of the urban populations in deve lopment and governance, forming strong partnerships with the private sector, and establishing effective decentralized administration systems that ensure self-rule of cities and towns. Regarding development of urban infrastructure, the key strategy is to enhance the capacity of city administrations to plan, provide and manage the supply of urban infrastructure and services. Investments in urban infrastructure have to consider the role and importance of the citie s in regional and national social and econo mic deve lopment. Infrastructure development should create an environment conducive to accelerated economic development and equitable d istribution of services. To realise fully the potential contribution of towns and cities to eco nomic and social development. the development and expa nsion of infrastructure will have to be undertaken through the joi nt and coordinated efforts of the governme nt. private sector. and the public. When infrastructure development activities are carried out. the potential to create a wide range ofjob opportunities and promote micro and small enterpr ise development, will always be taken into cons ideration. Low cost housing would also be promoted for the low and middle income households particularly in Addis Ababa. The housing development initiatives would result in the creation of new MSEs operating in the construction sector, strengthen the exist ing MSEs and provide huge employment opportunities. The housing program needs to be executed in a way it promotes domestic savings, reduces slums and improves the urban environment. The development of the construction industry will be promoted during the plan period such that it is labour-intensive, market-oriented, led by the domestic private sector, competitive, ethical, and free from corruption. Development of the construction industry will take into account micro and small enterprise development, capacity building requirements, and ensure the full participation of women. Steps will be taken to ensure that design and construction activities accommodate the needs of the disab led citizens. Object ives In order that urban and construction development contribute fully to the accelerated socioeconomic development of the co untry. specific objec tives that will be pursued are For urban developm en t: The priority objectives are to ensure stronger urban loca l capacities to develop and manage urban infrastructure and services, deliver etlicie nt, effective and fair infrastructure and services to urban citizens sustaina bly, and improve the urban environment for living and work. In addition. poverty and unemployment reductions are set as objectives 83 of the various urban infrastructure and business development initiatives. Strengthening the capacity of cities to self-govern themselves and public participation are -expected to improve the governance system. It is planned also to construct affordable. good quality and standardized urban housing. particularly in Addis Ababa. reduce urban slums. address housing (shelter) problems. promote domestic savings and create a wide range of job opportunities. For construction ind ustry deve lopme nt: The objective here are to ensure construction works are completed to the standard required. time limits set and costs planned. build the capacity of the domestic construction industry to fully meet local demand. enable the industry to make a significant contribution to the sustainable growt h of other sectors and the national economy. as well as improve its productivity. Additional object ives are to create jobs. develop the sector's overa ll capacity and increase the number of local companies (contractors. consultants. construction machinery supplying and leasing companies. and construction material suppliers) engaged in the industry. and ensure the effect ive usc of public investment in different construction works. Major targets With regard to construction and urban development the main targets dur ing the plan period are presented in the following tables. Table 37. GTP Targets for Co nstr uct ion Development Sub Secto r Description of Target s I. Raise the capacity of exis ting cont ractors by improving capacity of higher grade local contractors and consultants 2. Promote (based on prior assessme nt) lower grade contractors to middle and higher grades 3. Facilitate the certification of non skilled and sem i skilled manpower 4. Promote the introd uction of ne w contractors and consultants 5. Build the capacity of companies leasing plant and equipment 6. Based on thoro ugh research reso lve the supply and demand gap relating to both local and ind ustrial construction materials. Table 38. GTP Target s for Ur ba n Development Sub Sector Description of Target s 200 9ltO 201-1/15 I. In Addis Ababa. construct and tra nsfer houses (no) 150. 000 2. Red ucing slum areas in Addis Ababa (%) 60 30 3. Construct houses in sugar developme nt projects (no) 10 1.022 Urban infrastructur e deve lopment targets include 4. Construction of cobble stone roads [ Kr n] 3738 5. Con struction of drainage networks [Km] 3527 6. Developm e nt of solid waste lundfllls sites ( no) 35K 7. Develop ment of modern abattoirs (no ) 2 14 299 In addition completion of all low cost houses under construction. as part of the ongoing housing development program in all regions, at the start of the plan period and put in place an 84 effec tive regulatory policy to regulate the activities of private real estate developers and housing cooperatives will be implemented. Implementat ion st rategies Ur ba n Development: The operational strategies here concern the strengthening of organizational and human resource capacities of urban local administrations. The development and implementation of a sustainable urban infrastructure and housing finance system is also another element of the implementation strategies. Here the primary focus will be on improving domestic savings and revenues for infrastructure and housing developments. The experiences so far with regard to public participation in planning. delivery and management of infrastructure, housing and services as well as other governance issues will be consolidated further during the GT P period. Finally the undergoing initiatives of strengthening the urban planning, design and construction capacities will be consolidated further to ensure better quality, cost efficiency and productivity in infrastructure and housing de livery. Constr uction Industry: The emphasis is on enhancing the capacity of the domestic private sector so as to create a competitive local construct ion industry. To this end a comprehensive capacity building program will be adopted and implemented. In the plan period, implementing strategies will be adopted to increase the quantity and improve the qual ity of local contractors. consultants and construction machinery leasing companies. The provision. production and administration of construction materials will be strengthened and existing and new local low cost construction materials developed and improved through research and technological transfer; their use in designs and construction will also be provided. In sum, the second strategy is promotion of import substitution in the production of construction materials and services. Emphasis will be given to proper use of manuals, procedures and checklists and adherence to regulations in all government and private construction activit ies. In other words the strategy here is to fully enforce the building code already adopted by the country. 85 CHAPTE R 6. SOC IAL SECTO R DEVELOPM ENT I' LAN Social development plays a key role in enhancing people' s living standards. poverty eradication, economic grow th and stable governance. Much emphasis has been given to the deve lopment of the sector in the past and it has developed rapidly. For the GIP period. based on the results ac hieved so far in the sector. the prov ision of education and health services will be expanded with the focus on ensuring the quality of services provided. 6. 1 E I)UCAT ION AN I) TRA I NI NG The Educati on Sector Development Program for the GIP period (ESDP IV) has the goa l of produci ng democratic. efficient a nd effec tive. knowledgeable. inspired and c reat ive citizen s who contribute to the realization Ethiopia's vision of being a middle income economy. The ESOP IV focu ses on educating and training a wor kforce that meets industries' needs at all levels, particu larly the grow ing manu factu ring industry. The plan for the OT P period has also take n into accoun t the findings of the review of ESOP III. Based on that review. the ESOP IV was deve loped with a strategic d irection to ens ure equitable access to quality education at genera l, TVET and higher educatio n levels, and also e nsure that these three education levels have strong linkage s to, and interrelationsh ips with, each other. T he key objective ove r the next five yea rs is to e nsure the ac hieve ment of the MOO targets.

6.1.1 Stra tegic Directi ons The strategic direct ions that wi ll be pursued during the OTP period under education and training sector, technical a nd vocat ional educatio n and training as well as higher education are presented below. Ge ne r al Ed uca tion: T he initiatives, already in place to expand basic educational services to all, and ach ieve the MOG targets, will be strengthened. Cost effective and part icipatory early childhoo d care and educatio n will be expa nded in both forma l and non-formal delivery mechanisms. The role of the gove rnment will be to facilitate policy based services, such as supervision to ensure quality, support for provision of materials, deve lopment and provision of curricula, standards a nd guidelines. provision of ea rly childhood care and educatio n class rooms, and space within formal primary schoo ls for commun ity dr iven progra ms. With regard to formal education, the exi sting strategic direction is to ensure equitable access to quality primary education. The undergoing initiative of providing fair and acce ssible quality formal educatio n wi ll be continued and consolidated. The cur rent gender dispar ity will be el iminated by the end of the plan period. The educatio n strategy for children with spec ial needs will be fully imple mented to meet the needs of this gro up. An importa nt priority will be to improve and e nsure the quality and efficiency of educat ion at all levels. To rea lize th is priority, the General Educatio n Quali ty Improvement Package (GEQ IP) wi ll be fully implemented. Its subsequent impact in improving stude nt ac hieveme nt (in terms of knowledge. skill and attitude) wi ll be verified through regular monitoring and evaluat ion. and through the Natio nal Assessments of Stude nt Ach ievement conducted every three years. The findings of th is assessment will be inputs to further enrich GEQ IP a nd achieve access to quality education for all. In addit ion, functional adu lt literacy (FAL) will be expa nded to all reg ions. Youths and adult s wit hin the 15-60 age range will participate in the program as per the FAL criteria. 86 Technical a nd Vocational Ed ucation a nd Training/TVli'T: A good quality and efficie nt TV ET system will be established through full implementation of the TVET strategy. To achieve this, gove rnment investment will be increased and cooperative training will be fully implemented in order to ensure provision of the human resources that will satisfy the demands of the nation 's labour market. The TVET system will continue to serve as a potential instrument for technology transfer, through the development of occupational standards, accreditation of competencies, occ upational assessment and accreditation, and the establishment and strengthening of the curriculum development system. TVET institutions will serve as the centres of technology accumulation for MSEs. Rigorous and regular monitoring and eva luation will be carried out amongst TV ET institutions. Government and private monitoring will enable them to ensure the minimum levels of competency. The basis for M&E will be whether the training tak ing place is al igned with the demands of the economy and whether trainers are satisfying the requirements cited in the trainers' competency package. M&E will also look at the trainees and assess whether they fit the profile and demands of their chosen occupation and are ab le to access job opportunities. Generally, the M& E system will eva luate whether TVET institutions are on the right track with regard to the strategy and, if not, take immediate corrective measures for improvement. IIigher Ed uca tion: T he key priority for higher education during the plan period will be to ensure qua lity and relevance. To this end, the management and administrat ion system of universities will be improved and strengthened, and efforts will be made to enable the Higher Education Strategic Centre and the Higher Educat ion Qua lity Assurance Agency to achieve their purposes. The performance and implementation capacity of technology institutes will be built upon. Implementation of a full fledged teacher development progra m will ensure an adeq uate supply of university teachers. The revised curricula will be impleme nted in line with critica l issues. such as, instructional process, assessment and examinat ions and student achieve ment. The education provided by Higher Education Institutions (HEls) will be made compat ible with the quantity, type and quality of the human resources demanded by the economy and the labour market. Accordingly, the increase in enrolment in graduate and post graduate programs will aim to be in line with the 70/30 program. A system will be introduced which wi ll enable universities to raise their ow n internal revenues. Th is will help them improve the qua lity and relevance of education provided. A techno logy transfer-centred research system for HEls will be put in place. Capacity building wi ll be undertake n to improve performance, especially of science and technology institutes and departments. Capacity building will aim to make certain HEls support economic devel opment through technology transfer. In genera l, the research system in HEls will be guided by the role they play in the economic growth and development of the country. Assurance of the quality and relevance of education provided in private HEls will be another key priority issue during ESOP IV. These institutions will be evaluated and quality assured. based on the degree to which they are organized and deliver services as per the higher education proclamation and strategy. The provis ion of higher education in the private sector will be required to give priority to quality and relevance, through regular M& E and, where necessary, cor rective measures. Through continuous support and mon itoring. HEls will beco me more effective and efficient and provide a student friendly environment especially for young women and students with special needs. 87

6.1.2 Objectives The obj ectives of the education sector development program are to ensure an effective and etlic ient education and training system that enhances quality, etliciency, relevance, equity and access at all levels. This will be achieved through performance capac ity building. and the development of. and adherence to. competency criteria. Objectives of General Ed uca tion: The objectives for general educat ion are to expand access to good quality primary and pre-primary education and to maintain their quality and etlic iency, expand good quality secondary education that serves as a foundat ion and bridge for production ofa middle and higher level workforce that meets the demands of the national economy and labour market, expand the intake capacity of HEls, ensure equity in education by narrowing gender, regional and urban-rural d isparities, and expand access to functional adult literacy (FA L) to enhance the country' s all round development endeavours. Objectives of Technical and Vocational Education and Training/TV f.T : The objectives for TVET are to provide an outcome orientated, good qual ity and equ itable service, in rural and urban areas, that meets the demands of the national labour market. TVET institutions and services will become centres of technology transfer creating concrete capability to support MSEs through technology acc umulation, building organisational capacity and transfer of technology. To this end, particular emphasis will be given to develop ing an integrated TVET package that will involve all actors and stakeholders. The TVET integrated package will strengthen the ab ility of industries to set occ upational standards and provide accred itation of competencies. A main object ive for TVET is to support women and youth to gain work ing skills and competencies that ensure they are economically self sutlic ient. Obj ectives of Higher Edu cation: The objective for higher education is to establish HEls that are foc used on result orientated management, adm inistrat ion and performance, and that recognize and scale up best practices. A further obje ctive for HEls is to provide an increased quantity and quality of skilled and capable human resources that meets the needs of the country in regard to its development in genera l, and the manufacturing industry in particular. To this end, HEls will ensure that enrolment prioritizes science and technology. In addition, successful HEls, that have provided good quality and relevant education that meets the demands of the economy and enhances the compet itiveness and competency of female students, will be recognised.

6.1.3 Ta rgets Targets set for the plan period, as indicators of access, equity, qua lity and efficiency, and which will help to monitor and achieve the general and specific objectives of the education sector, are described below for general, TV ET and higher education. Gen eral Education, quality and efficiency: All schools and resource centres, at each level, will have principals and supervisors who meet the standards set. By this means. a school management system that ensures educational quality will be established. Students that complete each cycle of education will acqu ire the civic and ethical behav iour desired. Teachers at all levels will be required to be professionally licensed so that the qual ity required is mainta ined and every subject specified is relevant. Thus, teachers accountability and responsibility for implementation of qual ity oriented teaching. learning processes and curricula, in every sphere of general education, will be assured. Table 39. GTP Targets for General Ed ucation Description of Target s 2009/10 2014/15 I. lncreuse studen ts' score in exa m inations and usscssmcr us at all grade 50 90 levels of ev ery' subject l %) 2. Gross enro lment rate to r pre-p r ima ry edu cation (%) 4.2 20 3. Net enrolment ra te for prima ry educa tion ( 1-8) (%) 87.9 100 4. Gross enro lme nt rate to r gene ra l sec o nda ry ed ucat ion (9 · 10) (%) 39 .7 62 5. Gross enro lme nt rate of functiona l adu lt lite racy (%) 36 95 6. (Icndcr disp arity tl -x} (% ) 0 .93 : 1 I :I Table 40. GTP Targets for Technica l and Vocational Education and Training Desc ription of Target s 2009/10 2014 /15 I. Compete nt/cert ified ca ndid at es (%) 23 60 2. Tech no log ies that ca n hel p create wealth and increa se income (no) 30 00 J. T VET grad uates that enter the labou r market and be e mp loyed (%) 90 TVET system capability will be estab lished to acco mmodate participants who have the need and readiness to attend TVET and who can satisfy the minimum requirements for each level. Higher edu cation : Universities will strengthen manageme nt and administration systems thai can promote their missions of achieving quality and relevance of education. They will cond uct research, which focuses on so lving problems in quality and relevance and development, and they will enhance community services. Provisions for standard fac ilities of libraries and laboratories will be assured in all HE!. Table 41. GTP Targets for Ili gher Ed ucation Description of Targets 2009/10 2014 /15 I. University teac he rs (no) 23.()()() a. Teachers wit h second deg rees (%) 75 b. Teachers with PhD degrees (%) 25 c. Student - tcachc r ratio 1:20 2. Annual inta ke for pos tgraduate progra ms (second degree and PhD (no ) 16.1 00 3. The ave rage grad uation rate of unde rgr ad uate program (%) 93 a . The gra duati on rate undergradu ate programs for fe males (%) 90 b. The gradu at ion rate undergrad uate prog rams tor males (% ) 95 4. Gross ad missi on for unde rgraduate prog ra m (7 0:30 program m ix) (n o) 185.78 8 467 .00 5. Participation rate of fcma les in undergraduate progra ms (%) 29 4 6. Participation rate o f females in pos tgraduate prog rams (%) 10 2 6,1.4 Implemen tation St ra tegies General Education: To ensure quality and efficiency of general education, capacity deve lopment activities will be undertaken to enhance the performance of leaders and implementers, to the standard indicated in GEQ IP. at all levels. The implementation of best practices referred to in the GEQ IP, in every school, will be scaled up. Scaling up education quality will be encouraged by building communities' sense of ownership of educational quality by initiating integrated community mobilization, at all levels. using every media. 89 The qua lifications of teache rs. at every stage and for every type of education. will be upgraded as described in the teacher development blue book through pre-service. in-service and continuous professional development schemes. by provision of special training to English teachers to raise their proficiency at each level. per the standard set. by application of an assessment tool for and identification of skills gaps. by fully implementing the Maths and Science strategy that aims to raise student awarene ss and motivation for improved learning in maths and science and achieving better results in these subjects. and by creating strong linkages and harmo ny between the curricula of different primary education. secondary education and teacher training institutions curricula. To improve the qual ity of education. digitized (plasma based) secondary education will be deve loped in a way suitable for broadcast. To implement this initiative a checklist will be deve loped to determin e the expected attitudes. skills and inputs required. The d igitized broadcast strategy aim s to implement the GEQIP efficiently, establish an effective M&E system. evaluate the impact of the GEQIP upon changes in student achievement and eventually upgrade excellence of the GEQ IP and its implementation. With regard to equity and access. the Early Childhood Care and Education policy package and strategy will be fully implemented. Participatory school construction and networks will be promoted . The distance between children's homes and schools will be reduced. The existing Alternative Basic Education Centres to regular schools will be transformed. More Alternat ive Basic Education centres will be established when and wherever necessary. A strong transformationa l nexus between Alternative Basic Education centres and formal primary schools will be established. In scarcely populated areas, as a means of integrating and maintaining children in school and of meeting the needs of pastoralist and semi-pastoralist students. strategies adopted will include open multi-grade classes, open mobile and para-boarding schools and school feeding programs. To improve the access rates of children in emerging regions, affirmative action for children with vulnerabilities will be promoted. To increase access to secondary educa tion. secondary schools will be expanded. The expansion of secondary schools will also involve increased provision of secondary preparatory education. to meet the demand of the economy for a skilled human workforce and be matched with the intake capacity of HEI. The private sector. NGOs and the community will be encouraged to open secondary schools. Support will be provided and monitoring of quality carried out to ensure the standards of these schools meet requirements. Implementation strategies for functional adult literacy will follow the FAL strategy and include interventions to provide curriculum and guidel ines, institutionalize training of FAL facilitators at all co lleges of teacher education in order to carry out facilitator training effic iently. The strategy for Special Needs Education to ensure equity and access will be implemented. A robust M&E system will be put in place at all levels and corrective actions taken where required. Techni cal and Vocational Ed ucation and Training: Implementation strategies here include ensuring the TV ET system is. as much as possible, co mpatible with international labour market standards. Particular emphasis will be given to the ability of TVET to absorb and use the existing expertise in the country. Which experts have valuable competencies will be identified through competency assessment. Use will be made of accredited assessors who hold senior positions in industries, so as to establish occupat ional standards comprehensively and for assessing other experts. A result expected from these strategies is that only those assessors who are accredited and competent carry out assessments. 90 Other main strateg ies are to prior itize occupations and facilitate conditions for provision of comprehensive in-com pany training. From among graduates, those with high competency wi ll be selected for the post of trainers at T VET centres. Further, implementation strateg ies are to promote selected and experienced trainers to senior levels of training and managem ent. Accredited trainers and teachers will be given owne rship ove r various training and technology transfer activities. The capacity of the industrial work force will be improved to internatio nal labour market standards. So as to achieve sustainability of the TVET system. the industry' s institut ional ownership of TV ET systems will be ensu red. It will be ensured that all TVET centres have competent and accredited trainers for all occ upations in demand. Main TV ET implementation strategies for strengthening MSEs are to provide capacity development, by promoting them as centres for techn ology transfer, ensure a decent ralized. integrated and outco me based T VET system throughout the co untry, realize com petencies at every level. strengthen the TVET system throug h regular organizational monitoring, involve stakeholders in occupational standards, develop the curricula. training and assessment tasks. establish a system for training needs analys is. continuously upgrade occupational standards. and conducting train ing of involved personnel. IIi gher Ed ucation: For higher education, implementat ion strategies pursued will seek to strengthen university leadership and providing leadership training for new candidates of higher and midd le leve l positions. The intake capacity of all universities espec ially in science and technology and teac her development programs wi ll be increased. The professional competence of HEI teachers will be scaled up by providing them with training on, among other subjects. pedagogy, student assessment and action resea rch. The new universities currently under construction will be made fully operat ional and they will be furnished with the eq uipment necessary and encouraged to give priority to science and technology and teacher development programs. A system to promote institutiona l & teacher com petence and expert ise in conducting research and adapting technology will be esta blished. The National Qualifications Framework will be developed and implemented. All universities will be encouraged and supported to establish well organized and policy guided internal quality assurance systems. The capacity of HEls to undertake graduate tracer studies and ana lyze employer needs will be developed. Lastly, it is expected that HEls will be ab le to revise and improve their curricula. as we ll as developing schemes for the provision of affirmative actions for those who need additional support. (females. youth with d isabilities. emerging regions. etc) such as. special admission criteria. tutorial support and scholarship opportunit ies.

6.2 H EALTII In prior years, remarkable achieveme nts have been realised in the expansion and co nstruction of health facil ities and improvement of the quality of health service provision. The Health Extension Program is an innovat ive health service delivery progra m that aims at universa l coverage of primary health care. The program is based on expanding phys ical health infrastructure and developing Health Extension Workers who prov ide basic preventive and curative health services in the rural community. The Health Sector Development Program IV is designed to support the policies. strategies and targets of the gove rnment for the GT P period. The highest priority areas for health secto r development program will be maternal and newborn care, child health, and halting and reversing the spread of major com municable d isease such as IIIV/AID S, TB and malaria. 91 6.2. 1 Strategic Directions The co re e lements of the health strategy are dece ntra lization of the hea lth care system, development of the preventive. promotional and curative co mponents of health care, assurance of acce ssib ility of health ca re for all segments of the population a nd the promotion of private sector and NGO s part icipation in the healt h sector. In add itio n. hea lth pol icy gives focus to health promotion and disease prevention, curative and rehabilitative services. public health emergency prepared ness and to enabling the population to contribute its own health. The health sector development plan aims at ensuring community ownership and empowe rment through effective social mobilization. en hanced and sustained awa reness creation. supporting com munity organizatio ns and creat ing an e nviro nment conducive to community ownership and em powerment. The Health Extensio n Program will be the prima ry vehicle for preven tative healt h, healt h promotion, behav ioural change co mmun icat ion and basic curative ca re through effective implementatio n of sixteen packages. The del ivery of good quality hea lth services is central to improv ing the health status of the population . The Qua lity of Health Service applies a three-pronged approach to improv ing qua lity of health services. A Health Care Financing Strategy aims at increa sing resource flows to the hea lth sector, improving the efficie ncy of resource utilization, and ens uring sustainability of financing to improve the overa ll coverage and quality of hea lth service. Steps to invo lve the co mmunity in the planning. implementation. monitoring and eva luatio n of health interven tions will be strengthened. The role of the private sector in the de livery of health services will be increased in the plan period. Vertical integration of program inte rventions at the point of health service delivery will be given high priority. The pr imary focus during GT P will be on the provision of qua lity primary healt h care for a ll. Thushealth ce nters will serve as a first curative referral ce nter for liPs and wi ll provide health care that will not be avai lable at the li Ps through ambu latory and some cases of inpatient admissio ns. Health post and health centers will be equi pped and staffed as per the standard and expanded in all Woredas. Notw ithstanding the primary foc us on primary hea lth care. due e mphasis will a lso be given to the expansio n of higher quality hospital services as per the policies and strategic directions of the health sector. Refe rra l system will be stre ngthened through effective implementatio n of the new guide line. To provide better quality of health services. the human resource strategy of the health sector will focus on retain ing trained health professionals on the one hand. while on the other hand giving greater atte ntion to a larger sca le training of specialists, med ical doctors and midw ives to compensate for the bra in drain. Of particular importance, given the fact that health outcomes depend on so many factors, is the inter-sectora l co llaboration in crosscutting areas such as water supply and sa nitation, education, ge nde r, population. and food supply. Also. give n the partnersh ip and network ing between the Government and NGO s and civ il society and private sector organizat ions engaged in health related activ ities is beco ming increasingly impo rtant in enhancing implemen tation of the program. In addit ion. the health sector will forge strong part nership a nd c reate a coordination mec hanism to ensure that there will be conducive environment for the Developm ent Partners and NGOs/C SOs/ Private sectors to enhance the scaling up of inte rventions during the strategic perio d. The ro le of private sector in the delive ry of health service will be strengthened in the co ming five years. Integration of the ve rtica l prog ramme inte rventions at the point of health service delivery will be acc orded utmost attenti on. Private hea lth care providers will be strengthened. motivated. monitored and regu lated in order to provide a good quality health service that sat isfies citizens. Internationally 92 standardized and competitive specialized hospitals will be promoted to provide quality health services not only for Ethiopians but also for other citizens to generate foreign currency and promote and enhance national self-reliance in health development by mobilizing and efficiently utilizing internal and external resources. Private pharmaceutical factories will also be given much emphasis by providing incentives to sustainably produce and de liver quality pharmaceuticals. In order to achieve the desired results of the health sector, a resource mobilization and procurement (health care financing) strategy will be implemented. To ensure sustainable national pharmaceutical and service supplies to health facilities at all levels, adequate budget will be allocated. So as to enable uninterrupted and adequate pharmaceutica ls and medical equipments to health facilities, the necessary incentive package will be considered. In addition, significant reduction in pharmaceutical wastages and improved rational drug use will be another focus of the strategy. Strategic direct ion related to HIV/AlDs: On the basis of the National IIIV/AlDs Policy emphasis will be on expansion of effective prevention and control activities, promotion of basic curative care related services, strengthening the systematic collection and use of HIV/AlDs related informat ion, providing special care and protection to m V/AIDs patients, mobilising adequate and sustainable resource to finance the HIV/AlDs strategy , as well as on reducing vulnerability and new incidence to IIIV/AlDs. In addition, focus will be given to a National Children Health Strategy aiming at the reduction of under five mortality, expanding family planning. ensuring pre and post natal cares and support. hygiene and sanitation and reduction of major communicable diseases.

6.2.2 Objectives The general objective of the health sector is to improve the health of the population by promoting health of citizens and providing preventive. curative and rehabilitative health services. Specific objectives are to Improve access to health ser vice: Th is object ive includes provrs ton of affordable health services to improve the health of mothers, neonates, children. adolesce nt and youth, reduce the incidence and prevalence of m V/AIDS, TB. malaria and other communicable and non - communicable diseases and improve hygiene and environmental health. Improve quality of health services: Thi s objective includes provision of health services of a standard quality by health facilities at all levels. The standards app lied cover speed of delivery, harmonization at the point of service delivery through the integration of vertical programs, exploitat ion of opportunities arising. service effectiveness, patient safety and the ethics and professionalism in service delivery. Improve public health emergency preparedness and response: Th is objective includes improvements in health risk identification, early warning, response and recovery from existing and emerging disease epidemics, acute malnutrition, and natural disasters of national and international concern. Improve pharmaceutical supply and ser vices: This objective aims to increase the availab ility of pharmaceuticals at an affordable price and of a satisfactory condition. Improve health infrastructure: This objective includes expanding, equipping, furnishing, maintaining and managing health and health related facilities, expanding use of relevant technologies including health information technology, technology transfer and vaccine production. 93 Improve evidence based decision making: Th is objective aims at evidence based decision making through enhanced partnership. harmonization. alignment and integration of projects and programs at the point of health service delivery. Improve human ca pita l a nd leadership: This obj ective involves leadership development. human resource planning. development and management including recruitment. retention and performance management. community capacity development and technical assistance management of the health sector. Add itional objectives for the health sector in the plan period are to improve community ownership. maximize resource mobilization and utilize as well as improve the regulatory system of the health service delivery. Improve Co mmu nity Initiatives/Participation and Own erships: This obj ective encompasses awareness creation and ensuring community participation in policy formulation. planning. implementation. Monitoring and Evaluation and mobilization required to implement health sector development programs. Improve Resource Mobilization a nd Utilization: This objective includes a proact ive approach in the mobilization of required adequate and sustainable resources from available sources and eff ectively utilize the resources to achieve MDG targets. Improve regulator)' syste m: Th is obj ective is about ensuring safety in the del ivery of health services. products and practices; prevention of professional malpractices: enhancing environmental health activities: enforcing regulations and prevention of drug abuse;

6.2.3 T a rgets The main targets for the health sector in the plan period are presented in the following table. Table 42. GTP Target s for Health Description of Targets 2009 /10 2014 /15 I. Decrease maternal mortality rate per 100.O(H) mothers 590 267 2. Dec rease under Ilvc mortality rate per lO(H) child ren 10 1 6S 3. Infa nt mortality rate (per 1000 live births] 77 31 4. Increase family planning service (CPR ) (%) 32 66 5. Increase Penta 3 lmmunizctlon coverage (%) R2 96 6. Reduce IIl V/A IDS incidenc e (%) 0.2 8 0, 14 7. Increase TB Case Detec tion Ratc (%) 36 75 8. Red uce malaria incidenc e (%) 0.7 <0,7

6.2.4 Implementation St rategies High priority health sector implementation strategies are to strengthen and scale up the Health Extension Program. The construction. expansion and improvement of health centres and hospitals. including expansion of specialized hospitals will be accelerated. Health posts and health centres will be renovated and properly maintained. Government will ensure that the inputs necessary to provide the population with good quality health services are available. Health service capacity to train and recruit a large number of specialists. general practitioners. health workers and midwifes will be improved. Health service quality regulation will be conducted and licensing and inspection strengthened. The health care financing system will be strengthened by expanding health insurance and improving human capital and leadership. Emerging surgery services to mothers will be started in all district hospitals. Women's participat ion. engagement and involvement in the health service delivery will be ensured. The role of private sector will be enhanced, the estab lishment of hospitals providing specialised services improved and pharmaceutical supply and services improved by providing incentives for local pharmaceutical producing institutions. The ongoing civil service program will be strengthened. Public-private partnerships will be developed. Activities that ensure the participation of a ll stakeholders will be scaled up. 95 CHAPTE R 7. CA PAC ITY BUI LDI NG AND GOO D GOVE RNANCE Remarkable res ults were achieved over the past plann ing periods in terms of establishing a stable developm ental and democ ratic gove rnmenta l system. These achieveme nts in good gove rnance and the democratization process playa key role in ens uring rapid and sustainable develo pment. human and ca pita l reso urces development a nd for achieving sustained economic development and Ethiopia' s MDO targets by 20 15. Thus based on the achievements and c hallenges expe rienced so far, the GT P envisages to consolidate the capacity building, democratization and governance programs of the country. 7. 1 CA PACIT Y B UI LDI NG 7. 1.1 St ra tegic Directions Strategic directions in the capaci ty building component include a conce rted and integrated effort to enhance the capacity of the civil service to imp lement government policies and strategies effective ly a nd efficie ntly. Another major strategy during the GT P period is the scaling up of best practices in the design and implementatio n of civil service reforms in Ethiopia. To implement this strategy. civil service reform program activities to date wi ll be rev iewed. and best practices identified. packaged and scaled up. Three key strategic directions are described below. Esta blish gove r nme nt struct ures wit h strong implem enting ca pa city: This strategic directio n will involve. during the plan period . the full implementation of the Civil Service Reform Program at all levels of the government structure (federa l and regional) in orde r to strengthen the refor m agenda . Civ il servants will participate in awareness creatio n activ ities that aim to develop who lly positive attitudes towards serving the public. ensure that they fully understand gove rnment's policies and strategies. and are ca pable of implementing them. Overall this strategy aims to ensure increased efficiency. effect iveness. accountability and transparency of public sector service delivery. In particu lar, the Balanced Score Card. a n initiative of the civil service reform programs. will be implemen ted with comm unication support to strengthen the work ing systems. Ensu re tra nspa re ncy a nd com ba ting corr upt ion fr om its so urce: This strategic d irection will involve initiatives to imp lement fully a system of asset disclosure and reg istratio n by every citize n with a view to recognizing and protecting their rights. The tax admi nistration will be improved through strengthening the tax information system. enforce ment and public education. An urban land registration syste m that ensures transparency and accoun tability. tenure sec urity and efficie nt land and immovab le property market will be set up. Awa reness will be created through educatio n on ethics to encourage citizens to nurture a zero tolerance for corruption and rent seeking behaviour. A system for transparent disclosure and reg istratio n of assets owned by political leaders and public officia ls will be establ ished, The systems described will also deter ac tivities involv ing. and detect any assets ga ined through. illegal and imprope r activities. educate the public at large to be pro act ive in challenging corru pt practice s a nd officials and bringing to j ustice those who are engaged in impro per acq uisition of assets. tax evasion or indeed. any illega l act ivity which aims at gaining any be nefit. Ensu re public participa tion : T his strategic direction will involve initiatives that e nsure cit izens' participatio n in local governance and deve lopment decision maki ng. In additio n. the Woreda and local administrations will be strengthened to ensure better public part icipation and thereby to facilitate the achievement of the Millennium Development Goals. Affirmative 96 action will be taken to enhance the participation of wome n at Woreda and Kebele level, engage and mobilize the public in local infrastructure development act ivities such as primary school and health station construct ion, create an enabling environment for professional and public associations to enable them to protect and promote their rights and benefits. introduce and make operationa l institutional and organisational mechan isms. in all spheres of governmen t and for professional and public association s. to encourage and ensure full public participation in the formulation and evaluation of govern ment policies. strategies and deve lopment plans. support professional and public associations and organizations in their efforts to build inter-organizat ional initiat ives that promoting principles contributing to democratisation such as tolerance, respect for the rule law, etc. Incorporat e a nd Implement C ross C utt ing Issues in the Civil Serv ice: During the plan period. particu lar focus will be given to empowering women through capacity building. Affirmative act ion will be taken to increase the partic ipation of women in education and training; this will increase the number of women who hold decision making posts. Gender issues will be mainstreamed in the implementation of capacity building programs and in monitoring and eva luation systems. HIV/AIDS aware ness creating programs will be designed and implemented to increase the awareness of civil servants about the eco nomic and social issues involved and to increase the level of support for those affected by the d isease. including orphans. In accordance with their constitutio nal rights. an enviro nment cond ucive to increasing the contribution of people with disabilities to the civil service will be established. Aware ness creation workshops and training sessions will be arranged that increase the understanding of civil servants abo ut the negative impact of cl imate change and global warming and about population policy implementation. During the GTP period. the capacity of outstanding young professionals will be developed and a system made operational to increase their participation in middle management decision making positions. To this end the proportion of young graduate professionals in the civil service will be increased. With individual efficiency as the bottom line. affirmative action will be taken to ensure that civil servant appointments to decision making positions represent proportionate ly each of Ethiopia's nations and nationalities. In addit ion. part icular focus will be give to increase the opportunities for education and training of minorities. 7. 1.2 Objectives The GTP objective for capacity building is to ensure accountability and transparency in governmenta l operations. working procedures and systems. In addit ion. emphasis will be given to capacity building that supports the implementation of government's policies. strategies and programs.

7.1.3 Main Target s To achieve the object ives set for capacity building. the following targets will be implemented. Improve the ca pacity of top lead ership: Leadership is crucial in strengthening democracy and building good governance, and in implementing government policies. strategies and programs. An obj ective of the GTP will be to build the capacity of top leadership management in the plan period. Initiatives to achieve this object ive will build the capacity of leaders at both federal and regional levels, and at all levels of governme nt structure so as to bring about effective and etlicient leadership. Human Resou rce Developm ent (HRD): During the plan period attent ion will be given to human resource development. To this end. various measures will be taken to upgrade the capab ility of the civil service to implement the GTP. These measures will include review of 97 legislative frameworks and establishment of modern HRD systems. An objec tive HRD measure s is to e nable civil servants to be more responsive to pub lic demand s a nd to implement government policies, strateg ies and programs in a n effi cient, effe ctive, transparent and acc ountab le man ner. Build the capacity of government institutions: HRD, organisational deve lopment a nd improving operational systems and procedures are three pillars of capacity building. Th is section dea ls with the latter two aspects. Some of the main area s of focus in building the capacity of government instit utions will be to transform government agencies so as to improve service delive ry, improv e their eflic iency and effectivene ss in providing pub lic services, and enha nce implementation capacities throug h improved working systems and procedu res as well as establishing appropriate organisational systems. Surveys have shown that the majori ty of government agencies have already shown gains in efficie ncy as a result of var ious interventions in the last strategic planning period. Howe ver, the same surveys a nd evaluations revea l that effectiveness is at its infancy and much needs to be done to improve the situation in the next planning period. The survey findings have established a baseline and it is intended that the effectiveness of all governm ent agencies \\" i11 be at a much higher level at the end of the planning period. Targets set for the plan period will be measured aga inst predeterm ined standards as a result of full scale implementation of USC and of the monitoring and eva luation mechan isms estab lished. Esta blish a more tra nsparent, accou ntable, efficien t & effective governmental fina ncia l management system: The obje ctive is to establish an effec tive. efficient, transparent, accountabl e and modern governmenta l financial mana gemen t system. This will be achieved through introd uction of lega l instruments, properly mana ging expenditures, putting in place cont rol systems. a nd emp loying skilled a nd competent personnel. During the previous plan period. various projects were designed and implemented to introduce modern governmenta l financial management systems. The GT P will further build on the success ful practices and gains of the reform process to date. Ensur e a trans parent and account able system : The purposes of th is objective are to institutionalize systems ensuring transparency and accountab ility throughout the civil se rvice so that the att itudes and actions of civil servants are directed toward s serving pub lic interests. There are indicat ions. follow ing the var ious interventions taken in the last five year s that transparency and acc ountability exist to a degree within the civil service. During the GT P period procedures for access to information. compla int handling, pre-noti fication of service requir ements. and disclosure of pub lic information will be introduced to e mbed transparency and accountability within the civil service. A related issue concerns combating rent seeking attitud es and pract ices. The target here is to substa ntially reduce rent seeking attitudes and prevent and control resultant practices/behaviours/ in the pub lic service and of other actors. The focus will be on those related to tax admin istrat ion. urban land adm inistration, procurement and othe r susce ptible areas. Enha nce public participa tion : Public participatio n is central to ensuring Citizens ow n devel opment and to the success of good governance initiatives and to sustai n them. Citizens participate in devel opment processes by expressing the ir demands and aspirations and so contribute to formulating policies a nd strateg ies, and to planning. mon itoring and evaluation activit ies. Efforts made to expand democracy and good governance through the participation of community based organ izations (Cll Os) will include organisation of pub lic meetings, involve ment of cooperatives, professiona l associat ions, and other CBOs, and by ensuring the regular and proper participati on of citize ns and C UDs by improv ing the transparency a nd accountabi lity of operational proced ures of governmental organizations. A number of participat ory mecha nisms that contribute to good governance have been implemented previously, however, the participation ofC BOs needs further improvement and so, in the GTP period, remedial actions will be taken to strengthen the degree and consistency of public participation. Build the ca pacity of woreda a nd kebe le councils: Building the capacities of woreda and kebele councils by training staff and improving working systems is of paramount importance in strengthening good governance and democracy at local levels. The focus during the plan period will be to strengthen the implementation capacity of both urban and rural woreda and kebele councils by establishing improved operational systems, enhancing the capabilities of councillors, deepening democrat ic participation, establishing transparent and accountable systems, and strengthening internal controls. Enha nce civil serva nts ' awareness of the supremacy of law: This capacity building objective aims to ensure that civil servants have good knowledge and understandi ng about the importance of the supremacy of law and that the law is applied. A change of attitude among civil servants is intended. Government agencies make a critical contribution to the fair and proper implementation of laws enacted by the government. For this reason civil servants should have knowledge of the content and purpose of laws and regulations that are relevant to them; they should be able to apply them fairly and fully. Civil servants will in future be supplied with all newly passed laws and regulations, along with supporting documents. A lesson learnt during the previous development plan is that even though pertine nt new laws and regulations come into existence, civil servants have a habit of carrying on their duties and responsibilities as they d id before; it is business as usual. It is intended to change this situation and ensure all civil servants are knowledgeable about and apply properly all laws and regulations. This will be achieved as by identifying those laws to be prioritized and creating awareness among the civil servant with training and workshops. Priority areas are, among other, the Civil Service Proclamation and those proclamations relating to education. health, the constitution, government finance, the budget proclamation, counterterrorism, broadcast, freedom to information, charities and soc iety's.

7.1.4 ImpJementing St rategies The implementation strategies here refer to enhancement of skills and knowledge of the implementing agencies and agents, from lower to management level, wider application of best practices, as well asensuring effective communication that mobilises public participation for transformational reform. Experience sharing between different administrative levels will be strengthened and the participation of stakeholders in the reform process enhanced. A well d irected and organized monitoring and evaluation system will evaluate the impact of the reforms introduced. All inclusive ca pacity building: Particular attention will be given to increasing the implementation capacity of all developmenta l stakeholders; in the governmental, private sector and the public arenas. The comprehensive capacity building implementation package includes integrated human resource development. organisational development and operational systems working closely together. Build the capacities of capacity b uilding inst itutions: These institutions help sustain and advance reforms in the public service through human resource development, consultancy and research. Thus enhancing the capacity of these institutions so as to effectively support the civil service reform will be taken as one strategy in GT P. Integra te Capacity Building Act ivit ies: Capacity building activities are being undertaken by diff erent institution. li enee the strategy should be carried out in an integrated manner to save 99 time a nd cost while implementing ca pacity bui lding programs. Hence, a coordinating institute will be established to ove rsee the ove rall activities. Harmonize capacity building activities with the reengineering reform program: Reform is a co ntinuous process in the capacity building program. There wi ll be unpredictable obstacles or, a lternatively, good opportunities that a rise during implementation of the capacity building program, which were not anticipated during the plan preparation. For thi s reason, it is an imp lementat ion strategy to watch for and take advantage of opportunities that ar ise a nd address and resolve obstacles duri ng implementation. Enhance reengineering reform communications: Unless the reform program is supported by a communicat ion strategy, it will be diffi cult to create the support for ca pacity building reform among the c itizens, and in part icular among the civil servants, that ensures the ir e nthusiastic support a nd full co ntr ibution in implementing gove rnment's age nda. To address th is issue, a strategy has been designed to ensure the full comprehension at top manage ment level as to the importance of communicat ion for effective reform . During PASDEP, a high level of support and ent husiasm for reform was ge nerated in soc iety ge nerally, and in impleme ntation agencies in part icular . During the GTP period, effort will continue to be made to increase support further through the co mm unicating strategy; the reform program will be core to the daily activities and tasks of government orga nizations. Suppor t the reform with I'C'F: To date a variety of activities have taken place to tran sform gove rnme nt organ isat ions. These incl ude Business Process Reengineer ing a nd Balanced Sco reca rd. The Business Process Reengineering exercise is now fully operational in most of the federal and regional government institutions, while Balanced Scorecard is in the process of being imp lemented. It is importa nt these reform measures are supported with ICT in orde r to ensure the civil service is effective, efficien t, transparent and accountable, as well as to increase the co ntribution of civil servants to the transformati on process. In th is context, it is planned to automate Business Process Reengineering a nd Balanced Scorecard by introducing new software, test ing and then fully implemen ting the syste m in all government age ncies duri ng the plan period.

7.2 INFORMATION AND COMM UNICATION TECHNOLOGY DEVELOPMENT

7.2.1 St ra tegic Directions The strateg ic d irections to be pursued for enhancing informa tion and communicatio n tec hnology development in the country are development of information comm unication technology infrastructure, ICT human resources and the legal and secur ity syste m related to ICT. In addition, deve lopme nt of e-gove rnance thro ugh use of IT, enhancing role of private sector in ICT, and pro motio n of IT research and de velopment will remain strategic direction of the sector dur ing GT P period. 7.2.2 0 bjectiycs The overall objective for ICT is to support the GT P in ensuring sustainable development and poverty erad icatio n, human resource de velopment, ca pacity building a nd good governance through well-deve loped and a ll-inclusive capa city augmenting communication technology interventions. During the GPT period, an objective for ICT development is to gradua lly expand ICT over the entire nat ion and at all levels of the soc iety by expa nding ICT use and access on a large scale, and introducing co mmunity ICT facilities. A seco nd object ive is to ensure the security of ICT services and protec t the system from cyber crime by creating an appropriate institutional framework (policy, law and regu lation) as well 100 as organizat ional and human resource capability. Expansion and development ofi CT will also be encouraged by developing and putting in place uniform procedures, standardization of the technology applications and improving the efficiency and effectiveness of the human and financial resources available for ICT.

7.2.3 Major targets During the GTP period. the maj or targets for the lCT sub-sector are to develop human resources for ICT to support overall develo pment of the sector. Development research will be conducted to enhance the contribution of lCT to economic growth and soc ial development. A suitable policy, legal and regulatory environment will be created that contributes to poverty eradication and expedites the success of development objectives. A uniform set of proced ures. standards and quality contro l mechanisms will be deve loped and put in place for the lCT sub sector. The use of human and financial resources will become efficient and effective. Finally. a key target is to prevent and fully control illegal activities and there by ensure the security of the ICT system.

7.2.4 Implementation Strategies The first strategy is to promote the development of ICT infrastructure and services in connection with higher education institutions so as to ensure sustainability. quality and releva nce. The private sector will be encouraged to enhance its role in the sector, while an lCT Park will be developed in Addis Ababa. Other implementation strategies that have been designed to achieve ICT objectives by the end of the GTP period include: develop and standardize the ICT infrastructure and services; improve the nationa l and regional states information exchange systems by installing broadband internet networks; provide ICT services to beneficiaries at compet itive prices; support IT professional needs in selected economic sectors within the country, facilitate the provision of computer education and training to society at a large scale; create an enabling environment that supports increased innovation, creativity and professionalism of ICT professionals; enact legal instruments relat ing to ICT resources and services development and ensure that these are incorporated into other development policies, strategies and programs; revise the legal and regulatory frameworks, in collaboration with national and international stakeholders, to improve and expand ICT development; put in place management and quality control directives and standards that regulate the supply of lCT services and products; introduce the disposition of alphabets of national languages and make use of the Unicode Technology; provide support and foster ICT research and studies; develop the information Kiosk; and encourage development of a culture of internet use for various economic and social activities and create enabling conditions to increase computer ownership.

7.3 JUSTI CE SE CTOR 7.3. 1 Strategic Ilirections The overa ll strategic direction for the j ustice sector is to contribute to establishing a stable democratic and deve lopmental state. Contributions made by the j ustice sector in this direction. will be to establish a system for citizens to access j udicia l information and ensure that the ju stice system is more effective. Steps will be taken to ensure that implementation and interpretation of laws are in conformity with the constitution; where they are not, they will be amended. The independence, transparency and accountability of courts, and of the judicial system as a whole, will be assured. Law enforcement agencies will be strengthened by strengthening human resource skills and providing adequate equipment. The publics' 101 understanding and aware ness of constitutiona l issues will be enhanced. Customs and traditions of peaceful resolution of disputes will be given specia l emphasis and will be applied widely during the GTP. 7.3.20bjectins The objec tives of the j ustice sector are to strengthen the constitutional system and ensure the rule of law. make the justice system more effec tive, efficient and accessible as well as more independent. transparent and accountable. In addition the GTP aims to consolidate the process of creating a democ ratic. stable and strong federal system that ensures the peace and security of citizens.

7.3.3 Ta rge ts Human resource capaci ty development: The new curriculum for Bachelor of Laws (LLB) deg rees will be fully implemented. Teaching materials will be prepared for the new curriculum and will subsequently be eva luated and upgraded regu larly. An appropriate number of professionals will be trained for their second and third degrees and a system will be esta blished to this effect. Training will be based on needs assessment and pre-service training will be given to newly appointed prosecutors and jud ges. Short term training will be provided at least once a year for j udges and prosecutors serving at all levels ranging from Woreda up to Federal Supreme Courts. so as to enhance their capacitie s and to address their shortcomings related to attitude, knowledge, ethics and skill. The capac ity of other professionals in the j ustice system will be enhanced. To this end. the federa l and regional level training institutes will be well equipped, while researc h works that help build the capacity of professionals working in the ju stice sector will be encouraged. Ethical standards will be set and enforced for practicing lawyers and attorneys. Improve the transparen cy and accountability of th e ju stic e system: A system to increase transparency and accou ntability will be fully established. A mechanism will be estab lished to evaluate the effective ness of the professionals. Ethical principles will be made know n and be implemented fully by the professionals involved. Complaint handl ing offices will be strengthened. An effe ctive and cost saving resource management system will be estab lished and implemented. Strong monitoring, eva luation and support systems will be estab lished. Independence, tran sparency a nd acco unta bility of the judicia ry : A system will be established to ensure acco untabil ity, while guarantee ing the jud iciary' s independence. The appoint ment of judges will be based on competence and will ensure fair regional and gende r representation. The performance eva luation system for j udges will be expanded, continuity of the eva luation system will be ensured, and the screening process will be improved. A system will be estab lished for the speedy resolution of discipl inary matters that are brought before the jud icial administrat ion council. Improvements will be made based on consultations with and contributions from service users and stakeholders. The hearing process in the justice system will take place in full in open courts. Cessatio n dec isions and laws will be made avai lable in time for j udges. Enha nce sendee accessibility: Standardized accommodat ion in which justice agencies and courts can work in an integrated manner and which are more accessible will be provided. Initiatives to provide the services of the courts throughout the year will be expanded to all cou rts and cou rts will provide services 24 hours-a-day. Efforts that have been started to make the courts more acce ssible to women and children will be fully implemented and expanded to all courts in the country. The initiatives that have been started to make the co urt environment friendlier for users will be expanded and implemented in all courts in the country. Indigent 102 lit igants will be provided with adequate legal counsel, a id and translation services. The number of j udges will be increased to ensure that the number of ju dges corresponds to the size of the populations they serve. Rehabilitation of prisoners: National prison inmate handling and protection standards will be prepared and implemented to ensure appropriate rehabilitation of prisoners. All prison inmates will be encouraged to become productive and law abiding citizens by attending civic, ethics, academic and professional training sessions. Inmates will be helped to increase their income by taking part in developmental works. Their human rights will be ensured. Provision of/for inmates' accommodation, health, nutrition, communications and recreational services will be improved. A system will be established and implemented to follow up the integration of inmates in society released after serving their terms. Efforts will be made to improve the public image of prisons. Strengthen the federal system : The values of peace and tole rance will be promoted and the capacity to reso lve disputes peacefully will be strengthened. Mechan isms will be established and implemented to detect and prevent confl icts before they occ ur and resolve conflicts that have arisen before they result in harm. In this respect it is noted that, the capacity to resolve d isputes permanently is dependent on research related to conflicts. Measures will be taken to enhance the values of tolerance and respect between religious institutions and their followers. Solutions to religious confl icts will be sought and implemented through research which will be conducted to identify sensitive religious issues. The awareness of the leadership at all levels, and that of the population, of issues relating to interstate relat ions and federalism will be significantly enhanced. A system will be established to ensure permanent intergovernmental agency, as well as federal and regional state, relations. Increase public participation: Participat ion of the j ustice system staff in the preparation and evaluation of plans as well as on other necessary issues will be strengthened (internal participation). Measures will be taken to improve and enhance the participation of stakeholders in issues related to justice (external public participation). Improve sector communication : Public relation activities will be carried out to raise sufficiently the awareness of governmental agencies and of the public about the performance of the j ustice organs. The preparation and publication of professional magazines within the ju stice organs will cont inue. Enhance the use of l eT in the reform process: A national integrated ju stice information system will be established and put into use. Actions will be taken to support the court system with information communication technology which will be extended to all courts in the country. A public prosecutor information system will be established and put into use. All work processes and offices will be modernized by developing appropriate software and a databa se for file and record keeping. Information about inmates will be supported by ICT and there will be maximum utilization ofI CT in all the training centres. Ensu re the mainstreaming of cross cutting issues in justice sector: The j ustice sector will devise and implement a mechanism whereby the rights of women and children as well as of persons living with HIV/AIDS, as recognized by the constitution and international agreements, are fully respected. Their equal participation in society, and the opportunities and benefits accruing from that participation. will be ensured. 103

7.3.4 Implementation Strategies To ach ieve the objectives and targets established for the ju stice sector, during the GTP period. a number of implementation strategies will be adopted. These are summarised in the following paragraphs. The reforms required will be supported by specific initiatives to build implementation capacit ies of the agencies involved. The law required will be drafted, codified and consolidated, prior to adoption, based on proper research. At all times the sector will render effective, efficient, accessible and predictab le j ustice to all and ensure the etlic ient and effective execution of court decisions. Strategies will be implemented that preve nt crimes that endanger the constitutional system and public interest and, where such crimes are com mitted, the perpetrators will be brought to ju stice. Prisoners will be helped to become law ab iding, skilled and to respect the rights of others. An environment conducive to ensuring last ing peace and respect between religions and religious institutions will be created. Good governance and deve lopment will be supported by conducting legal research, raising the knowledge and awareness of the public on human rights protection and strengthening the rule of law. Strategies will be pursued that ensure that the rights of women, children and persons that live with lII YI AIDS, as they are recognized by the constitution and international agreements, are respected, that they participate equally in and benefit from development. The publics' respect for law and order and support of law enforcement activities will be gradually raised by raising overall awareness of legal issues. Laws will be disseminated more wide ly and more etliciently in order to increase public knowledge and awareness of the law. The role of civic societies and stakeholders in good governance and development activities will be enhanced. A system will be established to ensure that attorneys have the required professional capability and ethics and to strengthen their role in the administration of j ustice. The registration of legal practitioners will be fully implemented. The values of gender equality will be promoted so that women participant more equally in good governance and development, and the capacities of women in the justice sector are enhanced. Professionals in the j ustice sector will be made more aware of the nature of HIY/AIDS and its transmission, so as to protect themselves from HIY/AIDS, ensure that sufferers get the appropriate help in a manner that respects their human rights, and support implementation of health policy that is focused on prevention.

7.4 DEMOCRACY ANll GOOll GOYERNANCE

7.4.1 Strengthening Democratic System 7....1.1 Str ategic Directions During the GTP period, the strategic d irect ions to ensure democratic governance in the country are to adopt and effectively enforce laws that support democracy and good governance, conduct free. fair and democratic elections and ensure the human rights of all cit izens. In addition, the rights of women will be protected. One economic and po litical community will be the aim and to this end the deve lopment of a culture that respects the constitution, human rights and democratic values will be fostered. Government will give a guarantee that people are well represented. Acco untability in general will be strengthened and the financial audit system in particular; the accounting and audit system will be standardised. An enabling environment will be created for citizens to hold consultative d ialogue with government about human rights. Research related to human rights will be undertaken. The 104 freedom of the press and the rights of citizens and freedom of information will be ensured. Good governance and democratic institutions will be strengthened and deepened. ' .... 1.2 Objectives The objectives are to strengthen democratisation and good governance and consolidate the existence ofa federal democratic political and economic community. '.4.1.3 Main Targets Strengthen Councils and institutions accountable to them : A number of activities have been carried out during the previous plan period to strengthen these institutions, enhance their role in the process of building a democratic culture, and build the capacity of staff involved through short-term training and experience sharing. During the GTP period these activities will be continued and, more speci fica lly, the capacity of these institutions wi ll be strengthened through training, system and organ izat iona l development. In particular, to strengthen the parliame ntary system of the gove rnment, it is planned to build the capacity of the membe rs of the House of Peoples Representat ive and House of Federation through training and with experience sharing workshops and by improving the working procedures of the two counci ls with application of infor matio n technology and network infrastructure for ease of information management and use to improve deci sion making. Awareness creation about human rights, democracy and the constitution : During the plan period the federal House of Peoples' Representative and House of Federat ion will conduct broad based awareness creation workshops and training seminars for students at pilot schools, based on the civic educat ion, using methodologies to encourage democratic culture such as the childre n's parliament instrument, and for pastoralists, mainly in conflict prone areas, and including wome n and youth soc iety groups, so as to create awareness about democratic culture. Ensure a federal democratic political and economic community: The following act ivities will be undertaken in order to ensure the realization of this objec tive. A number of initiatives will be undertaken during the GTP period that strengthen the relationship between nations, nationalities and peop les such that the federal democratic arrangeme nt in effect leads to better integrated political and eco nomic community in the country. The House of Federation will encourage extensive research on democratic federa l governance and make use of the findings to strengthen national consensus around the object ive of ensuring one eco nomic and po litical community. The documentat ion section of the House of Federation wi ll be equipped with research materials to fac ilitate proper decision-making by the House. The grant sharing formula will be revised and improved to create balanced and equitable regional development. An early warning system will be put in place to prevent conflicts. and indige nous conflict resolution mechanisms used to mob ilize local communities. Provide laws and directives to create an enabling system to ensure democratic representation and accountability to public resource: The House of Peoples' Representative and regional counterparts will issue acts and directives, that have been developed based on research, to realize the objectives of the GT P. Ethiop ian Human Rights Commission. Eth iopian Institution of the Ombudsman and the Office of the Federal Audit or will work clo sely with House of Peoples ' Representative for effective implementation and mon itoring of this objec tive. Ensure council's accessibility and accountability to the public: Councils of representatives established at all levels are expected to ove rsight the perfor mance of the gove rnment. This oversight exe rcise is expected to ensure active and organised public participat ion too. The 10 5 participatory oversight of the councils is expected to playa crucial role in ensuring that government policies and programs are implemented as per the plan and that measures are timely taken to rectify any shortfa lls. The federal and regional councils will secure media airtime. develop user friendly websites, publish and increase the circu lation of press releases and booklets. in order to address the public and collect public percept ions of democratic institutions and the democrat ic process. These initiatives will also enhance the participation of federal and regional councils in the decision making process. Advocacy Centres will be established to reach out to the public at lower adm inistrative levels and make accessible minutes. reports of the councils. annual plans and other related information. Enha nce public participation : Regional, Woreda and Kebele councils will initiate activities to increase public participation in the development planning and democratizat ion process. The participation of women in councils will be enhanced to achieve better political part icipation and involvement in decision making. The capacity of the council members will be improved, through training and exper ience sharing study tours. The participation ofCBOs and the public at large in development planning. implementation and monitoring will be strengthened. Directives and laws that will support the functioning of CBOs and professional associations will be put in place. 7....1... Im plementa tion Strategies Strategies that will be adopted to implement the GT P, so as to achieve the objectives and targets for democracy and good governance described above, are to build the capac ity of institutions. ensure the legislative assembly (law making process) is effective. and the codification and consolidation of laws is based on research and studies. The delivery of effective and efficient j ustice services will be enhanced and the acco untability of the judiciary ensured. The capacity of prisoners will be developed and their human rights ensured. Peace and tolerance between different religious groups will be established. Democratic governance will be supported and strengthened by conducting legal and justice system research. ensuring the supremacy of law and conducting awareness creation among the citizen about human rights. The accessibility and dissemination of printed and electronic copy of constitutions. laws and acts will be strengthened and increased. Participation of CBOs and stakeholders in the development process will be strengthened. The legal protection and rights of children. women. people living with HIV/AIDS and disabilities will be ensured. A mechanism will be created to enhance the professional ethics of lawyers through capacity building. Gende r equality will be ensured and awareness created among staff of democratic institutions about HIV/AIDS prevalence and incidence.

7.4.2 Good Gove rna nce 7....2.1 Strategic Directions Good governance plays a key role in realizing the government' s objective of eradicating poverty by enhancing public trust and ensuring efficient allocation of public resources for deve lopment. The strategic directions focus on improving the land and tax adm inistration systems. The strategic directions include enhancing the awareness of citizens about the consequences of corruption through ethics and anti-corruption campai gn and education such that the public nurtures zero tolerance against co rruption. Measures that improve transparency and accounta bility would be undertaken with particular em phasis on government organizations and public enterprises that are susceptible to corrupt practices by improving their operational systems. increasing the role the citizens in the fight against corruption. introducing registration system of the wealth of government authorities and civil servants. 106 introduc ing info rmat ion tec hnology systems, enhancing transpare ncy, develop ing cadastral land reg istratio n system, improving the tax informatio n system, taking lega l measures aga inst those gu ilty of co rruption and using these measures as an input to increase the awa reness of the public. In this context, a num ber of act ivities will be carried out in the plan period, in co llabo ratio n with the relevant stakeholders, incl uding c ivic educa tion a nd measures to develop a ze ro to lerance of co rruptio n amo ng the soc iety. Additiona l activ ities initiated will be to strengthe n the syste m to track corruption in soc iety and protect public reso urces. A citizens' identificat ion inform ation system will be put in place, as will systems to register ownership of land and establish urba n spatia l plans. Furt her, the public will be made aware of the need to pay tax as directed by law and regu lation at the time requi red and of the import an ce of taxes in fi nanc ing the GTP and its object ive s. ' ....2.20bjectins The objec tives of good governance are to enhance transparency and acco unta bility so that there is zero tolerance for corruption. Goo d governance initiative s will be suppo rted by information tec hnology and ex pansion of ci vic educatio n. Th e public service deli very sys tems will be modernized made effic ient, fa ir and transpar ent in thei r de live ry. ' ....2.3 Majo r Targets A GTP good go verna nce target is to deve lop a system, using modern info nn ation technology, to register the wea lth of gove rnme nt authorities and civil servants and track and take lega l measures where wea lth from un identifiable sources is detected. In addition, the aw areness of the public will be en hanced with the a im that there is zero public tolerance of co rruptio n and rent seeking. Ethic s ed ucation will help to increase public collaboration with gove rnme nt in the fi ght agai nst corruption. An anti-corruption strategy will be devel oped and impleme nted in all go vernme ntal o rga ns. An enabling mechan ism will be put in place to fight corruption. The know ledge and understanding of tax payers will be increased through developm ent and implemen tat ion of ICT . A c ustomers' service del ivery charter will be esta blished. A modem urban land mana gement system will be developed and the urba n spatial plan ning system improved to ensure that la nd is used eco nomically and in a transparent and accountable manner. Basic informat ion abo ut c itizens will be de velo ped a nd implemented. Government' s financia l managem ent systems will be strengthened. The a udit system and regulation app licable to the privat e sec tor will be strengthened. ' ....2... Im plemen ta tion Stra tegies Goo d gove rnance impleme ntation strategies are to give priority to the fight aga inst co rruptio n and enfo rce the law o n co rrupt practice s vigorou sly in co llabo ratio n with those age ncies invol ved with tax ad ministratio ns and land managem ent, impleme nt tran sparent o perational procedures for the tax and land management systems, build the ca pacity of governme nt' s implemen ting agencie s through the human resour ce devel opment and info rmation technology, wo rk in collaboration with stake holders to avoid co nditio ns that e ncou rage co rruptio n, and strengthen the federa l and regio na l anti-co rruption co mmissio n and orga nize forum s to enha nce the fight aga inst co rruptio n. Th e institutional ca paci ty de velopmen t of key age ncie s like the Cu stoms and Reve nue Autho rity, Ethics and Anti-co rruption Co mmi ssio n, Ministry of Urban Development and Co nstruction, Office of the A uditor Ge neral and Registratio ns Offices will be an importa nt e lement of the imp leme ntation strategy. 107

7.5 MEDIA BROADCAST AND COMM UNICATION

7.5.1 Media Broadcast 7.5. 1.1 Strategic Directions The strateg ic directions to be pursued in broadcasting of information for the citizens are to increase media broadca sts in type, number, qual ity and language, to increase geographic coverage, and put in place a regulatory framework for med ia broadcast.

7.5.1.2 Objective The GT P o bj ectives for med ia broadcast are to satisfy the public demand for mass media information through effective capacity development and implementat ion of the regu lato ry frameworks.

7.5.1.3 Major Targets Expand information provided by mass media : The target is to expand media coverage and services provided so as to increase benefits to the public. Media broadcast applicants will be licensed so that a satisfactory service is provided throughout soc iety. The ex ist ing laws and procedu res will be strengthened to enhance media ex pansion. Communicatio n that increases custome rs' partic ipation will be encouraged. The capacity of med ia profe ssional s will be strengthened a nd the use of ICT will be ex panded. Media inspection and support: Operat ing systems will be improved and legal directi ves d rafted and adopted that ensure that laws applied to the press are enfor ced and the public is satisfied by the quantity and q uality of information a nd media broadcast ing se rvices provided. The ca pacity of the med ia will be deve loped to enabling them to follo w med ia laws and procedures. A transparent o perat ing system will be developed, with man uals and standards, for media inspect ion a nd suppo rt. Part icipat ion of cu sto mers and the pub lic at large, and sha red ownership (com munity broadcasting) arrange me nts will be encou raged. 7.5. 1." Implementing Strategies Mass media expansion: Med ia cove rage in the country is. ge nera lly, at lower leve l. Many commu nitie s do not rece ive satisfactory media service. For th is reason, the governme nt mai nly focuses on improvin g accessib ility and diversity of medi a services. The implemen tation strategy is to expand and increase med ia in number, kind and transmi ssion coverage and to ensure the widest possible public be nefit from med ia broadcasts Media inspection and support: The co untry ' s media services have the ir lim itations in term s of de livering quali ty services and satisfying public interest. Thu s the second strategy is to improve suppo rt to broadca ste rs and ensure they operate within the regulato ry framework provided.

7.5.2 Government Communication 7.5.2. 1 Strategic Directions The strateg ic direct ions concern co nducting an effective co mmunication work based o n GT P, and building capable com municat ion institution in the co untry. In addi tion. current information will be effectively com municated to the public such that the public in turn becomes eve n mo re motivated for greater partic ipation and engage me nt in the develo pment and go vernance process env isaged in GT P. Communication of information that supports lOR nationa l consensus and builds a pos itive image of the country will emphasise the positive aims and achievements of the GTP by showing to the outside world that Ethiop ia is making significant improvements in socio-economic develo pment and good gove rnance. The strateg ic d irection focuses therefore on building nat ional consensus and thereby also on strengthening public part icipation in the development and gove rnance processes. and on improving the image of the country. 7.5.2.2 0 bjccth 'cs The objectives of government communication are to mobilize the public to parnc rpate actively in the implementat ion of the GTP. create a political environment conducive to greater and better international awareness abo ut Ethiopia' s achievements and support the country' s deve lopmental and democratization processes. Further objectives are to significantly enhance the country' s communication and media services. support the objectives of nat ional consensus and build a positive image of Ethiopia.

7.5.2.3 Targets A more conducive env ironment will be created for the participation of the public in the implementation of GTP and thereby also in the realization of the vision of Ethiopia. The communication targets will also aim to create consensus amo ng the public with regard to the signifi cance of ensuring the renaissance of Ethiopia, basic constitutional and policy matters as well as on the significance of the GTP. It is aimed also at effectively and accurately projecting the political, social and economic achievements of Ethiopia. Finally the capacity of media and art istic institutions will be built so as to effectively implement the communication plan.

7.5.2.4 Implementation Stra tegies Initiatives that will be taken to rea lize government's communication objectives during the plan period are to significantly improve the coverage of the med ia across the country by expanding television, radio and internet services and supporting infrastructures. Communication infrastructure will be improved by establishing fibre optic based networks and faci lities on a large scale, upgrading the capacity of the personnel engaged in the print media, underta king capacity enhancing activities for top manageme nt and 100\" er level media personnel at the federal and regional levels; and ensuring the private sector is the main beneficiary of the interventions. The ca pacity of the communication sector will be upgraded by improving organisational arrangements as we ll as the skills and capacity of the personnel involved, so as to ensure positive and effective communication. The awareness of the public at large will be enhanced to facilitate the national consensus building process. Innovative approaches will be employed to achieve this purpose and to speed up the tem po of deve lopment. An international symposium will be organised, after the GT P has been in implementation for two years, to put forward a positive image of the country and of the achievements of the GT P to that point. 109 CHAPTER 8. CROSS CUTTING SECTORS

8.1 G ENDER AND C H I LD REN'S AFFAIRS

8.1.1 Strategic Direction Wome n make up half of the country's population a nd the gove rnment has taken a range of measures to increase their participation in political. social and economic affairs. Th ere were signifi cant achieve ments towards ge nder equality and the empow erment of women in several areas during the PASDEP pe riod. Ethiopia has ratified a numb er of international and regiona l conventions and protocol s on women and child rights. A policy has been adopted and implemented to institutiona lize women' s affairs in all federal a nd regional age ncies. Th e new family law has been endorsed and the pena l code a mended for the benefit of women. Much has been ach ieved in the educatio n and health sectors to enhance the participation a nd empowe rment of women, as we ll as ensure that wome n benefit eq uitably. Women' s participa tion in decision making processes has been increas ing in all spheres of government. In the economic sector, their parti cipation in ag ricultural packages, credit and coo peratives services has increa sed. In urba n a reas the participation of women in sma ll enterprises, commercial and co nstruction unions, a nd micro fi nance instituti ons has also ex panded. These are a ll significa nt resu lts and efforts will be made in the GT P period to sustain and improve on these ac hievements. It is wide ly acknowledged that children are more vulnerable to man-ma de and natural risks. The government too k measures during the PASDEP period to strengthen and protect children' s welfa re and rights. A nat ional children's plan of act ion and an alternative child care and support guide line were prepared. At federa l a nd regional levels child rights enforcement committees have been set up. A national coalition force has been established to address the issue of children at risk. A national action plan has been designed and national committees established to protect children from sexual assa ult and labour abuse . The family law and penal code have been amended to increase and ensure the safety and security of children. In the social sector, c hildren in part icular benefited from the ex pa nsion of education and healt h services. Demonstration children's parliament s have been established a nd children are increasingly exercising their rights. Actio n was taken to coordinate a nd integrate the work of governme nta l and nongovernmental organizat ions to support and ca re for orphans and c hildren at risk. T he strategy now is to susta in and co nsolidate these ach ievements in the GT P per iod. 8,1.2 Objective The ma in objectives for ge nder de velopment duri ng the plan period are to ensure women' s act ive participa tion in the co untry' s economic and social development as well as political processes and equa l benefit s to women from the resultant outcomes. In add ition, harmful traditional practices that adverse ly affect the active engage ment a nd welfare of wom en will be abolished. The main objectives for children's affairs in the plan period are to ensure that children benefit from economic growth, that adequate ca re and support is pro vided to orphans and children at risk, that children' s participation in socie ty is enhanced, that harm ful traditional practices affecting children are reduced, a nd that their safety and rights a re respected. 110

8.1.3 Ta rge ts The following main targets are to be achieved during the GT P period. Ta ble 43. GTP Targets for Gen de r Development a nd Child re n' s Affa irs GTP Tflfget.\"lor Gel/der de~'eJop~"~"~"~t ~_""':'_""':' ~_~ :-_ _:-_~'" I. Increase the number of women entrepreneurs that graduate from operat ing micro e nterprises to small and medium sca le businesses. 2. Increase the number of women who receive trai ning in management and entrepreneurship. 3. Increase the number of women beneficiaries of credit and sav ing services. 4. Reduce the rate of abduc tion. early marriage. and female gen ital mutilation. 5. Increase the particip ation of women in decis ion making process . GTP Turget.\" ur Childre n .\"affairs 6. Mainstream child ren' s affairs in all sectors. 7. Support and care min vulnerable and children at risk. K. Introd uce community centred care and support initiatives lor c hildren at risk. 9. Redu ce the rate {Ifsexual assa ult and la bour abuse of ch ildren. 10. Red uce illegal child migration and traffic king. 8. 1.4 Impl em entati on St rategies Three key implementation strategies are identified with regard to women affairs. The fi rst concerns strengthening wome n associations and organizations. Secondly. a more conducive environment will be created for women to more actively participate in and benefit from development and governance programs through their associations and organizations. Finally, for the participation of and benefits to women to be effective and sustainable, eff ective coordination of women' s associations and organizations and all other actors is critical. In th is wayan accountable monitoring mechan ism will be established such that women' s affairs are mainstreamed and accordingly executed in all sectors. Implementation strategies for children' s affairs focus on preparing and implementing a comprehensive children' s policy. promote community based care for vulnerable and children at risk. and taking measures to reduce child abuse in the labour market. sexual assault and child trafficking.

8.2 YOUTII AND S PORT S D EVELO PM ENT

8.2.1 St ra tegic Ilirect ion Pol icy directions for youth focus on enhancing the part icipatio n of youth in democratic gove rnance. economic and social initiatives and ensuring youth benefit from the resultant outcomes. For sports development particular focus will be give n to promoting community participat ion in traditional and modern sports and strengthening the support given to high performing athletes so they are able to produce and susta in good results at regional and international events.

8.2.2 Ob jectives During the plan period the main objectives for youth and sports development are to increase the participation of youth in democratic gove rnance and economic development processes and build capacity in the sports sector to produce top class athletes fo r regional and international competitions. III

8.2.3 Targets The main targets for the plan period are presented in the following table. Ta ble 44. GT P Ta rge ts for Youth a nd Spo r ts Development GTP Tflfget.\"l or YOlII" de l 'elop"~m~e~,,~/ ~'7""""':" "'" I. Increase the number of youth centres at worcda level. 2. Mainstream youth development programs in other" development programs. 3. Increase the number of youth volunteers. GTP Tflrget.\ f! Jr Youth del'eloP.ment 4. Strengthen then technical, material and financial capacities of sport associations and committees at different levels. 5. Expand sports fields and training centers. 6. Increase the number of private investors in the SP0 rL~ development. and thereby enhance community participation. 7. Increase the number of managers and coaches in different sports. 8. Increase the number of tournaments and of participating athletes.

8.2.4 Im plem en tation St rat egies Implementation strategies for youth deve lopment include strengthening of youth associations and organizations and their all rounded participat ion. Awareness creation and introducing youth to information and knowledge exchange act ivities. and encouraging youth entrepreneurship will also be part of the strategy. Data bases relating to youth issues will be built and research concerning youth undertaken. Coalitions will be formed and cooperation with stake holders initiated for the implementation of the youth package. The key implementation strategy for sports development is to create an environment conducive to the empowerment and participation of community organizations in sports activities. Women and disabled people will be encouraged to participate in sports in their work places, dwelling places and schools, accord ing to their sports prefer ence. The government will, at all levels, support restructuring of the management of sports so as to increase community ownership and participation and make sports activities more financia lly self sufficient. Efforts will be made to increase the number and quality of sports specialists and experts. The participat ion of rural communities in traditional sports will be enhanced and, lastly, support will be given to loca l production of sports wear and materials.

8.3 HIV/AIDS PREV ENTIO N AN I) C ON T ROL

8.3.1 St ra tegic Dire ctions HIY!AIDS presents a challenge to our development and poverty reduction endeavours. The government responded to the potentially complex impacts of the disease by introducing. in 1998. its national li lY/AIDS policy and, in 2002. an Anti HIV!AID S med icine supply and use strategy . Survey results indicate that it is the 15-24 age working population, who are most vulnerable to Hl Y/A IDS. Since HIY!AIDS requ ires a longer term and improved care and treatment it is a major social problem. Thu s the prevention and contro l of HIY!AIDS has been integrated into the health extension program. T his approach helps to avoid the stigma and discrimination that can occur as well as raise communities' awareness and ensure their support for Peop le Living with 112 HIY/AIDS. In additi on it helps to integrate private and governmental efforts to sustainably raise resou rces to support People Living with HIY/A IDS. The main strateg ic directions to r the HIYI A ID S prevent ion and control program are to expand HIY/AIDS prevention activities. provide an all inclusive and good quality health service for HIY/AIDS and related diseases. reduce vulnerability to lII Y/AIDS. strengthen the systemic collection and use of data relating to I-I IV/A IDS. increase the accessibility of m V/AIDS related health services. and provide spec ial care and protection for HIY/AIDS patients and families.

8.3.2 Objectives The main objectives for HIY/AIDS prevention and control during the GTP period are to reduce the HIY/AIDS incide nce and preva lence rate. sickness and death rate and thus the impact of HIY/A IDS on society as a whole.

8.3.3 Ta rgets The targets for HIV/AIDS prevention and control during the plan period are indicated in the following tab le. Ta ble 45. GTP Ta rgets for IIi V/AID S Prevention a nd Co ntrol Description of Target s 2010/11 201-4115 I. Red uce II IV/A IDS incidence (%) 0.211 0.14 2. Awareness rate about 11 1VI AIDS among 15-49 years old persons (% ) 22.6 110.2 3. Adults on antiretroviral thera py (no) 246.347 41l4.966 4. Provide voluntary counselling and testing services (min ) 9.2 5. Children on antlrctrovlral therapy treatment (%) 95 8.3.... Implementati on St ra teg ies Implement ation strateg ies for HlV/A IDS prevention and control are to build capac ity for prevention and control. strengthen community partic ipation. and create awareness among the populat ion as a whole. In addition. lil Y/AIDS prevent ion and control activities will be expanded and special attent ion will be given to the vulnerab le in the society. Gender equality will be ensured. harmfu l trad itional practices abo lished and the stigma and discrim ination reduced. The accessibility of HIY/A IDS prevention and control services will be increased. Voluntary testing and counselling service services will be expanded and treatment of sex ually transmitted diseases and co ndom distribution given due emphasis. The safety and protection of persons who come into contact with blood will be ensured and immed iate treatment provided when they are exposed. The quality of and extended treatment and care service for people living with HIY/AIDS will be strengthened and care and support provided for fIIY!AIDS orphans.

8.4 SOCIA L W ELFA RE 8.... .1 Stra tegic Di rec ti ons The social welfare program focu ses on protect ing the rights of and creating opportunities for participation of disabled and elder ly peop le so that they contribute fully to the development process as well as to political. economic and social activities in the country. Social welfare initiatives focus on preventing the recurrence of social problem s that arose previou sly in the 113 soc iety. The programs impleme nted will mainly be community and family based, but governmental and non governmental entities will also play their role. Programs that aim to benefit the elde rly need to ensure their dignity, freedom and social status. Such programs will also focus on providing care and support for the elderly in the community and hence maintaining close family and social ties. The programs for people with d isabilit ies aim to prevent disabilities, provide education and training, rehabilitation services and ensure equa l access and opportunities for people with disabilities. Measures that strengthen positive attitudinal and behavioural changes of communities with regard to d isabi lity will be taken.

8.4.2 Obj ectives The main objectives are to provide an all inclusive and parnctpatory social welfare and security system that identifies and responds to social welfare challenges, expands care and support programs for the mentally ill, disabled and the elderly and contributes overa ll to devel opment activit ies.

8.4.3 Targets Two main targets for social welfare are set in GTP . The first concerns establishing a standard social welfare scheme involving government. non-gove rnmental agencies, elde rly and people with disabilities in the preparat ion and delivery. The second target refers to increasing the covera ge of soc ial security services overa ll based on the envisaged scheme. Based on this standard social welfare system, the number of disabled people who benefit from physical rehabi litation and support, of people who have access to socia l welfare, and of people who rece ive capacity development and awareness creation training, will be increased through the coordinated efforts of the co mmunity, people with d isabi lity, the elderly, the government and non - governmenta l agencies. Implementation Strategies All implementation plans need to focus mainly on community based we lfare systems. From this perspective, implementation strategies for social welfare during the plan period are to create a knowledge and experience sharing environment supportive of the elderly and help them to contribute to the country's deve lopment processes. Soc ial welfare aut horities will collaborate closely with and coordinate soc ial we lfare programs to care and support the elderly with stakeholders who are engaged in these programs. NGO care and support programs for the elderly will be encouraged. Disabled people will be encouraged to participate fully in economic, political and social development activities. Spec ial attention will be given to children with special needs and assistance will be provided to help them start and continue schooling. Governme nt will take steps to ensure that people with disabilities have equal jo b opport unities and participate in economic develo pment without discrimination or stigma. Measures that minimize barriers to the movement of people with disabilities. for instance in schools, homes. recreation centres and health facilities will be taken. Spec ial support for people with disabilities' mental and physical needs will be provided. Training and rehab ilitation programs will be provided and communities' participation in social welfare programs enhanced. 114

8.5 LABO UR AFFA IRS

8.5.1 Strategic Directions There are three key policies adopted for labour affai rs in the GT P. Th ese are To expand job information services by sett ing up a data base system to ident ify job opportunities. The system will enable analysis of labour market demand and inform policy makers, employers , eco nomically active citizens. research inst itutions a nd education and training centres. To expand workplace support and cooperation to encourage the resolution of labour disputes by bilateral (employee and employer) and trilateral (employee. employer and the government) dialogue and discussion. The government will also encourage improvements in working environments and job safety so as to increase productivity. l\lonitor of the wer king environment to ensure that employee s and emp loyers ab ide by the rele vant rules and reg ulatio ns and respect the ir duties and responsibilities to ensure job safety.

8.5.2 Objectives The objectives for labour affairs during the plan period are to ensure expansion of job information services, j ob safety and stability of the working environment and enhance labour productivity. Achieve ment of these objectives will co ntribute to overall socio-economic devel opment.

8.5.3 Ta rgets The following targets are to be achieved during the plan period Table 46. GTP Targets for La bo ur Affairs GTP Target.~ El r LalHlI/r AjJj~"~i~.~--7~ ~-7'"---------'" I. Ensure an effective enforc ement of the labour laws. 2. Launch a job inform ation serv ice. 3. Support job seekers. 4. Provide capacity development training to employees and employers. 5. Launch dia logue and discussion forums at workplaces. 6. Provide support to solve labour disputes through dialogues and discussions. 7. Strengthen monitoring of working environments.

8.5.4 Im ple me nta tion Strateg ies During the plan period implementation strategies for de velopment of labour affairs are to effectively implement the la bour laws through participation of stakeholde rs' , strengthe n public awarene ss of labour laws, enhance labour affairs impleme ntation ca pacity and expand job information centres. 115

8.6 POP UL ATION AN D D EVEL OPM ENT

8.6.1 Stra tegic Directions Ethiopia 's populat ion policy a ims to lay the foundat ion for ha rmonizing the rate of po pulat ion growth with the country's capacity to develop and use natural resources, and so improve the o vera ll living co nditio ns of c itizens. One of the features of Ethiopia' s dem ography is that a large number of the populatio n join the nationa l workforce each yea r. Th e ratio of the popu lation of wo rking age to the total populat ion was 54% in 2008 and estimates are that eac h year an additio nal 1.2 min peop le j o in the national wo rkforce. So when the pool of economically active members of the population increases in size. provided that they receive the support necessary to be produ ct ive, the co untry' s wo rkforce play s a significant role in increased eco nomic growt h and deve lopment. Fo r this reaso n. econo mic growth and development benefits fro m the o pportu nity presented by the nature of Ethiopia' s dem ographi cs. Moreover. the policies and strategies adopted by educatio n. hea lth. agriculture. industry and other secto rs wi ll cont ribut e positively to effective impleme ntation of the popu lation policy. 8.6 .2 Objective Th e ma in o bjective of the popu lation deve lopment plan during the GTP per iod is to lay down foundat ions fo r harmoni zing Ethiopia ' s mai n demog raphic characte ristics with de sired deve lopment outcomes of the co untry's economy.

8.6.3 T a rg ets Th e follow ing targets for pop ulat ion a nd deve lopment are to be achieved during the plan period. Table 47. GTP Target s for Population and Devel opment G7'I' Tl/rget.~ ftJr Population and Development I. Expand the health extension pr ogram ' s provision of family planning services . 2. Mainstream the population development agenda in. and ensure effective implementation of. the GTP development programs o f e\'CI)' sector. 3. Improve community participation in. and awareness of issues relating to, pop ulation development. 4. Support and strengthe n population educat ion as it is addressed in primary and second ary education programs. 5. Implement the national population. lnformatlon and communication strategy. 6. Increase the ratio of family planning users to 65% b)' the end of the plan period. 7. Enforce the family law provision of a minimum marriageable age of 18 years. R. Develop a population data base to assist research into migration, urbanization. etc. 9. Execute the national plan of action for population development so as 10prov ide lor the effective implementat ion of populalion policy. 10. Establish the national population council.

8.6.4 Implementation Strategies The first key implementat ion strategy to be pursued during the plan pe riod is expanding the coverage and alternatives of fam ily plan ning services. The seco nd strategy co nce rns e mpowe rment of wom en throu gh education. economi c and political partici pation . Co mmunity awareness ab out pop ulat ion issues will be en hanced through the mass media. Based on these strategies. women wo uld be put in a better position to de cide fo r themse lves on the number o f 116 children to have. T he capac ity of stakeholders working on popu lation issues will be enhanced through knowledge and exper ience sharing forums.

8.7 CULTURE AND TO URI SM

8.7.1 Strategic Direction s During the plan period. the strateg ic directions for the culture and tourism deve lopment program are to enhance the role tourism and culture play in socio-eco nomic and political deve lopment initiatives. The tourism industry policy directions aim to make Ethiopia one of the best tourist destinations in Africa. Tourism industry products and services will be expanded in quantity and quality to enable them to compete globally. Women and youth will benefit from the sector's development. Cultural and tourist att raction s will be used to build an attract ive image of the country. The cultural, natural and historical heritages and values of the country would be developed so that they play a significant role in social and economic development as well as in the democratization process of the country. Cultural goods and services will be promoted to playa greater and positive role in the country. 8.7.20bjecth'c The main objectives for culture and tourism. during the plan period, are to ensure the sustainable develop ment and conservation of tourism. Ethiopia's diverse and unique culture and cultural heritage sites. and encourage the community's participation so that. overall, cultural act ivities and tourism contribute to socio-economic develo pment and democratization process in Ethiopia.

8.7.3 Targets The following targets are to be achieved during the plan period. Table 48. GTP Targets for C ulture and Tourism G7'I' Tl/rget.~ fi}r Culture lind Tourism I. Registered. preserve. deve lop and promote all designated cultural heritage. national attractions. and tourist sites. 2. Ensure that earnings from the natural. culture and tourism sectors contribute to the overall vision that Ethiopia becomes a middle income country. 3. Ensure that culture contributes to strengthening of integrity and democratization of Ethiopia. 4. Make more accessible tourist attractions and cultural heritage events and sites. for tourism and research. 5. The promotion of cultural and tourism contribute to build a better image of thc country. 6. The culture and tourism sector contribute slgnlflcantly to foreign exchange earnings of the coumry.

8.7.4 Implementation st rategies The implementation strategies that will be pursued during the plan period include encouragement for all stakeho lders in the sector to follow an integrated approach in implementing the culture and tour ism program. Implementation gaps in the development of culture and tourism will be identified and rectified. while the full participation of communities in its development will be ensured. The capacity of cultural and tour ist facilities and service providers will be enhanced and accreditation will be granted when standards required are met. Strong linkages to global tourism markets will be facilitated in partnerships and through cooperation. 117

8.8 SC IEN CE AND TEC HNOLOGY D EY ELOPM ENT 8.8. 1 Stra tegic Direction s The follow ing six strategic directions will be pursued d uring the plan per iod by the science and technology devel op ment program. Bu ildi ng innovations systems will build an institut iona l fram ewo rk with policy implementation guide lines. Research will be conducted to analyze policy frameworks and de velop a scie nce and technology develop ment plan co nsistent with the social and eco nomic strategies of the country. The implementation of th is plan will be monitored and eva luated. Adeq uate reso urces will be allocated and funds secured to build innovation in science and tec hnology, with active engage men t in bilatera l and mu ltilatera l innovat ion projects. Technology tran sfer and deve lopme nt will involve increased coordination of and integration with stakeholders to identify technology demand, build value adding information and technology data bases, enhance the support systems, and develop a monitoring system for techn ology duplication and adaptation processes. Research and technology capacity development will focus on develop ing research and technology capac ity in industry, water, energy and other development sectors, support research projects and strengthen research infrastructure. Human resource development will aim to produce high quality human resources capable of expanding technological innovation and adaptation. and capable of managing science and innovation systems effectively. Intensive work wi ll be done at primary and secondary education level to realize the target of a 70/30 sc ience and mathematics enrolment rate at tertiary leve l. Q ual ity a nd sta nd ar dization strategies will build an accreditation system to international market standards for quality export goods and services, to enhance their com petitiveness. Ethiop ian quality and standardization guidel ines will be prepared and assessment and metrology organs accredited. A Science, tech nology a nd innovation info r mation develop ment initiative will compile and distribute national and regiona l science and technology information in databa ses, statistical abstracts and bibliography. A web platform will be provided to make access to the information easy and effective and an organisation established to facilitate and manage the initiative. A focus on cop yright and lintcllectual /pr oper ty rig hts will encourage innovat ion. strengthen copyright and intellectual property rights. and enco urage local innovators to deve lop local technological capac ity and deve lop the industry.

8.8.2 Objectives The main object ives for science and technology development during the plan period are to establish organisations and agencies that contribute to improvements in productivity and quality of local produce. Means to faci litate technologica l transfer will be estab lished. An innovation strategy will be implemented and high quality human resources produced. Quality and standards information wi ll be used for techno logical transfer to help exports of services and products compete in the global market. Measures to control radioact ive mater ials and radiation will be taken to ensure citizens' safety. Intellectual property rights and science and technology development systems will be strengthened. 11K

8.8.3 Ta rge ts The following targets are to be ach ieved during the plan period Ta ble 49. GTP Targets for Scie nce an d Technology Develop men t Description of Targets 2009 201·mS I. Increase firstlevel ethanol coverage ( % ) 10 75 2. Increase the number of patent documents (mIn) 30 50 3. Red uce the coverage of tsetse ny (%) 95 4. Usc S- min patent information doc uments lor technology transfer and adaptation. 5. Establish universities specializing in se lected science and technology subjects. 6. Strengthen the already existing agricultural. health and information technology research institutes with essential materials and linancial reso urces. 7. Establish technology and research institutes for industry. electro nics and micro electronics. water. construction. energy and material sciences. 8. Establish laboratories tor water. medical science. electro mechanical. chemical and geoc hemic al, material. concrete testing and gee-tec hniques subjec t areas. 9. Establish worldwide accn..xfltarlon in Ilvc measurement areas in International Organization tor Standardization I International Electro technical Commission 17025 laboratory quality management system. 10. Revise SOOO national standards and 5000 new standards for technology transfer. II . Establish accreditation for 60 science and technology organisations which meet national and international quality standards.

8.8.4 Impl em entati on Sirateg ies A wide range of implementation strategies for science and technology development will be pursued during the plan period. A national innovation system will be launched and an organisation to manage the system will be established. Research institutes for technological adaptat ion will be established. An administrative and legal system for copyr ight that mcets the country' s needs; will be created. Foreign technology flows into the country will be encouraged. Science and technology institutes capable of producing competent scientists and engineers will be strengthened. Human resource capacity to use. copy, adapt, improve and develop technologies will be created. Existing research institutes will be restructured and strengthened so as to contribute to the country' s technological capacity. Strategies that strengthen linkages between research institutes and industries will be introduced. Well structured and organized bodies that help to produce innovative technologies will be established. Implementation of mandatory national standards will be strengthened. Researc h activities related to collection. analysis. protection and distribution of science and technology information will be supported. The organ izat ion will be established to protect and deve lop the coun try' s intellectual property and the system to use intel lectual property for economic development will be strengthened. Synergies will be facilitated and linkages put in place betwee n organ izations working in environmental protection and public safety. Research and capacity building cooperation program s in science and technology that contribute to national development initiatives will be established and expanded.

8.9 ENV I RONM ENT AND CLIMATE C IIANGE

8.9.1 Stra tcgic Ilircctions Environmental conservation plays a vital role in sustainable development. Building a 'Green Economy' and ongoing implementation of enviro nmental laws are among the key strategic 119 directions to be pursued during the plan period. In building a ' green ' and climate change resistant economy there are two key issues, adaptation to climate change and mitigation of green house gases. Ad apta tion to climate cha nge: The cl imate is a natural phenomenon which influences positively or negatively social and economic activ ities. Climate has its own peculiarities and affects future opportunities for, and prospects of, the country. Even though Ethiopia' s greenhouse gas emission rate is minimal. the country is affected by cl imate change. There are agro-ecological zones (dry land and semi-dry land areas) and eco nomic sectors which are more vulnerable to climate change. Research findings show that Ethiopia annually loses 2% to 6% of its total production due to the effects of climate change. In Ethiopia climate change causes sporadic distribution of rainfall in dry and rainy seasons. In some cases excessive surface water runoff results has catastrophic effects. for instance very rapid filling and emptying of ground water reservoirs has been witnessed, as has biodiversity degradation. The evidence of these impacts shows how very critical it is that climate change adaptation strategies are put in place during the plan period and thereafter. l\l itigation of gree n house gases: Greenhouse gas emissions by developed nations have been enormous since the industrial revolution, and so it is mainly the responsibility of developed nations to reduce greenhouse emission rates. Ethiopia has the lowest per capita consumption rate of fossil fuels. It has almost no contribution to the greenhouse gas emissions that are the cause of adverse climate change impacts. On the other hand, in Ethiopia there are indigenous knowledge. practices and systems which reduce biogas emissions. In the agr iculture sector farmers use biologically based inputs like cow dung and compost as fertilizers. Ethiopia' s contribution to creating a stable and more beneficial climate is very clear. In addition, energy generated from wind and geothermal sources can meet Ethiopia' s energy demands. as well as those of neighbour ing countries and further contribute to climate conservation. Without putting pressure on farm land. ethanol production can be doubled. The forest coverage in the northern part of Ethiopia has been recovering since the past 20 years. There are practices in Ethiopia which can be adopted for mitigation of the adverse impacts of climate change. Focusing on economic development which mitigates cl imate change effects is very important from the point of view of the country's economic interests, its capacity to develop renewable energy sources and the prospects for its future energy consumption. The eco nomic development direction pursued by the Ethiopian government contributes to climate change mitigat ion and so may generate new and additional environmental support funds from developed nations. According to the Copenhagen Accord and the Kyoto Protocol, technological and financial support has been put in place for climate change mitigation works carried out by developing nations. For this reason it is timely to build cl imate mitigation capac ity so as to benefit from international financial support for environmental activities. During the plan period focus will be given to building capacity to mitigate the negative impacts of climate change. The current impacts and trends relating to climate will be identified and information on the possible outcomes and existing environmental management practices will be assessed and disseminated. Steps will be taken to either avoid the impacts of climate change predicted or limit the impact to an acceptable level.

8.9.2 Objectives The main objec tives for the environment and climate change initiatives in the GTP are to formulate and effectively implement policies, strategies, laws and standards which will foster social and green economy development so as to enhance the welfare of citizens and, environment sustainability. 120

8.9.3 Ta rge ts The fo llowing targets are to be ach ieved during the plan period Ta ble 50. GTP Target s for Enviro nment an d C limate Change Description of Targets 201411 5 I. Energy generated from renewable energy resources (MW) X.OOO 2. Sales of ethanol and biodicsc l (m in liter) 35 3. The minimum arca covered by forest (km 2 ) 2.000 4 . Area of productive forest developed ( k m ~ l 25.000 5. Area of natural forest developed ( km ~) 2.876 2 6. Area of forest of trees that shed leaves (km ) 4.390.6 2 7. Area of designated park land (km ) 60.360 R. Area of designated wetland (k m ~ ) 5 1.496 2 9. The area of farmland to which compost will be applied (km ) 40 .()O() 10. Land area utilised bv mixed farming & forestry for bio gas emission mitigation [krn") 26 1.840 II . The amount of urban waste used to produce methane gas (min 013) 20 12. I he climate change resistant green ceo nom) \\ III be strengthened and measures Will be taken by all tiers 01 gove rnment for preparation and implement ation of environmental action plans in all regions. 13. Policies. laws. strategies and action plans will be put in place to add ress climate change mitigation. 14. Dams. roads and infrastructure facilities which contribute to poverty reduction but arc vulnerable to impacts of cl imate change will be ldcntlflcd and mitigation measures will be put in place 15. Measures will be taken 10 mitigate climate change impacts to conserve the biolog ical resou rces. 16. Regions and cities/towns pass and implement laws to build a measurable and achievable green economy 17. Establish a national system for environmental NCiOs to ass ist them in the eff orts to build green eco nomy. 18. A dry' waste management law will be implemented at all federa l and regionallevels. 19. The law on biogas emission rate by the 8 high emission rate industries will be fully implemented. 20. To make environment policy effective prepare a proposalfor 5 additiona l environmental protection laws. 2 1. Reporting 10the public on the performance of the 5 year environment developm ent plan will be tim ely. 22. A national system will be built to help Ethiopia build a car bon free economy by 2025 and quality for additional global environme nt fund support. 8.9A Impl ementa tion St rategies The following implementation strateg ies will be pursued during the plan period. A plan of action. strategies. laws. standards and guidelines to implement measures that are designed to lessen the effect of forecasted climate change impacts wi ll be prepared . Programs to develop the capacities o f those stakeholders who are essent ial to ensuring effecti ve implementation of the action plans. laws and guidelines will be developed and implemented . Local and foreign technologies fo r climate change mitigation will be co llected and adapted. The capacities of the private sector and community organizations for fund raising globally will be enhanced . Environmental activities. public awareness and experience and knowledge sharing on environment management practices wi ll be developed and community participation in environmental activities increased. Good practices of environmenta l protection that are identified will be published and distributed . Certific ation. standardization and accred itation of the experts and organizations working on envi ronmenta l issues and cl imate change mitigation will be put in place. Internationa l env ironmental laws and protocols will be ratified and implemented. Appropr iate action will be taken when off ences aga inst envi ronmenta l laws are committed. 121 CHAPTER 9. OPPORTUNITIES, RISKS AND CHALLENGES IN IMPLEMENTING THE GTP Co nsidering the time hor izon and sco pe of the GTP, it is inevitable that there will be o pportunities that ar ise and unforeseen risks and cha llenges that emerge as the plan unfold s. The gove rnme nt has sought to tak e these into considerat ion in formulating the plan, by assessing recent performan ce and ach ievemen ts as well as challenges encountered. and e valuating the socioeconomic. political a nd the inte rnatio nal eco nomic co ntexts at the time the plan was conceived. The opportunities should contribute to the success of the GT P. The risks and challenges are expected to pose obstacles to the ach ievement of the GTP's objectives and target s and hence enta il mitigation mea sures. Th e governme nt has assessed the potential positive and negat ive exte rna l develo pments that ma y affect the performance of the Ethiopian eco nomy du ring the five yea r period, and the e nvironme nt in whic h the plan is imp lemen ted. Th e OT P has built in measures to manage the effects of eac h of these factors. It is timely that the OT P demand s more concerted effort s conside ring the o bjective of achieving the MOOs by 2014/ 15 a nd the co untry's visio n by 2020-2 023.

9.1 OPPORT UNITI ES Th e encou raging results and good practices ach ieved in the past five years ha ve brought ab out strong enthus iasm and co nfidence among citizens that pove rty ca n indeed be eradicated from the co untry. Th is enthu siasm is co nside red as a good o pportunity to strengthen the nat iona l consensus on the deve lopment and governance age ndas of the co untry and the reby to mobilize the wider public more actively to support the implementation of the OT P. A lesso n has bee n learnt that macro economy stability and susta inable economi c growth is possible with the policy and ad ministrative mea sures the government has been taking. The co untry's comparative adva ntages, plen tiful labour, a huge domestic market and substantial natural resou rce s pote ntial, a lso pro vide a good o pportunity for speeding up deve lopm ent in the coming five years. The OTP period is a period where the huge investments made so far in infrastructure and huma n reso urce deve lopment will result in greater returns by increasing the productivity of the eco nomy and by enco uragi ng more product ive investment. Thu s the OT P period is expected to ex per ience improv ing prod uctivity and product ion levels in a ll sectors by appl ying the best practices that have been identified to date and ca pita lizing o n the good o pportunities available. The ca paci ty building a nd good gove rnance packages that have been impleme nted at different admi nistrative levels a lso pro vide an opport unity in that they have created relat ive ly better ca paci ties even at lower le vels of administratio ns and in communities. Thi s he lps to increase public partici pation for greater allocat ive effici ency and results, and for more effective, tra nsparent a nd accounta ble service deli very in a ll sectors. The o pportunities descr ibed will serve as additional d riving forces for development in the OT P period. The investm ent needs of the OTP cou ld be mobilized by increa sing the co mmunities ' parti cipa tion in effective dom estic revenue co llection, savings and resource utilizat ion. In add ition, the good relationship betwee n the gove rnme nt and development partners and the go vernme nt's established co mmitment to eradicate poverty are expected to e ncoura ge increased exte rna l resource inflows, contributing to the success of the OTP. 122

9.2 R ISKS The main foreseeable challenges in the implementation of the GT P i nclude low implementation capacity, low nat iona l saving rate that is unabl e to support the inve stment need s of the economy. an d the unpredi ctabi lity of exte rnal finan cing. In addit ion, it is anticipated that globa l mark et price fluctu at ion s co uld pose some c ha llenge s to effecti ve impl ementation of the plan.

9.3 MANAG ING RI SKS Risk mit igation measures that address the foreseeab le risks in the development process me ntio ned a bove incl ude impro vem ents in the tax ad ministration system and broa dening the tax base so as to increase domestic resource mobilization. Government. organizations and indi vidu a ls will be e nco urage d to increa se thei r savings to pro vide adeq uate resources for the country' s investment needs . The favou rable policy and ad ministrat ive environ me nt created will support effec tive utilization of the capacit ies of co mmunities and the pr ivate sector as development partn ers in the development and governan ce endea vour of the GTP. Exte rna l finance resources will be mobili zed and . where secured. will be effectively used fo r investment in prio rity sectors. The contri butio n of local and internati onal NG Os a nd C BOs in the imp lem entation of the development plan will be strengthened. Measure s will a lso be tak en to add ress capacity limitation s by strengthening the implementation of the civ il service reform program at a ll leve ls. Foreign exc hange ea rnings will be increa sed by expanding ex port capacity. and substituting impo rts with co mpetitive loca l products. Measure s to gua rantee susta inable and rapid agricu ltura l and overall eco nomic growt h like sca ling up of best practi ces. and expanding irrigation will be taken as risk mitigation initiatives. Th e public ex penditure managem ent refo rms introduce to e nsure stringent recurrent expendi tures will be strengthened such that the limited available resources are e fficie ntly and effective ly uti lized for produ ctive purposes. 123 CHAPTER 10. MONITORING AND EVALVATlON OF THE GTP

10.1. BA CKGROU ND The main object ive of the GT P monitoring and evaluation system is to follow up on implemen tation of the sectoral and cross cutting plans included in the GT P so as to e nsure effectiveness of government policies and strategies. T he M& E system prov ides a tool to follow progress in achievemen t of planned target s. mainta in the co herence and integration of the overa ll economy, take timely correc tive measures when needed, and manage the development process effectively. Ethiopia' s M&E system is based on the sectoral approach and is a tool whereby tim ely and re liable information on result s. from the Fede ral to the local levels of gove rnmen t, is co mpiled and reported. The GT P' s M&E system is built on the existing Welfare Mon itoring System Program which has bee n in place since 1996. It is imperative that the M& E system has adeq uate data inputs and to support this need, the Ce ntral Statistical Agency (CSA) rece ntly launched the new National Strategy for the Development of Stat istics (NSDS) in consultation with relevant stakeho lders. The NSDS will help to generate data through surveys and censuses to mon itor implemen tation progress of the GT ? The adm inistrative data generated by sectoral line ministr ies will also provide an input to the M&E system. Data from censuses, surveys a nd administrat ive sources will be used to ge nerate full-fledged economic analysis and report s by the Ministry of Fina nce and Econom ic Development. The main ro les a nd responsibilities played by the major actors in the GT ? M&E syste m are outlined below.

10.2 MO NITORI NG THE OVERALL I'LAN I'ERFORMAN CE BV MoFED MoF ED chairs the Wel fare Monitor ing Te chnical and Stee ring Co mmittees that playa ro le at the nationa l level, in managing the ove rall eco nomy and coord inating the M& E system. The background report s prepared by the memb ers of poverty-oriented federa l exec uting bodies serve as a basis for the re ports prepared by MoFED. Sec toral annual impleme ntatio n, M&E report s ge nerate data to measure output and input results again st GT P performance indicators. Report s prepared by the CSA, based on information fro m surveys , generate data to measure outcome and impact resu lts aga inst GT P perform ance indicators. Based on the information avai lable from surveys as well as from ad ministrative sources, MoFED prepares annual implemen tat ion assessment reports as an input to the Welfare Monitor ing System Program and for timely distribution to the relevant government authorities as well as to non- governmental bod ies. MoF ED also provides up-to-date monitoring of we lfare, macro eco nomi c performance, national accounts, foreign resourc e mobilizat ion and administration, public de bt management, public accounts, etc. Mo FED holds regular annual meetings of Welfare Monitor ing Techn ical and Steer ing Co mmittees to address challenges face d in the implementation phase of national development plans and facilitate the learn ing and shar ing of emerging goo d practices. As part of the GT P M&E , focus will be give n to experie nces and emerging best practices so as to generate a lea rning and timely information sharing culture among implementing bodies. Annua l and end of plan period targets are set in eac h sector and, to summar ise and present these in a consistent co here nt form, a policy matrix is prepared and published by MoF ED. 124 The GTP policy matrix will present the targets set and detail possible measures to be taken to improve performance dur ing the plan period.

10.3 THE ROL E OF F EDERAL E X EC UTI VE B ODI ES Federal implementing agencies playa critical role in ensuring that the nationa l M&E system is robust and useful. As the M&E system becomes more robust and consistent it will be possible to prov ide more timely and relevant information to stakeholders. The M&E system has a national context as the targets set in the plan are focused at the national level. Federal implement ing agencies prepare and submit annual progress or implementat ion assessme nt reports to MoFED. They co ntain detailed information from the local levels of government. woredas, kebeles and city governments/administrations. As the ma in implementat ion agencies of the national developme nt plan are the regions, city governm ents/admini strations. woredas and kebele s. intensive capacity building activities will be undertaken in the next five years. in sector line ministries responsible for strong and coherent linkages with the lower administrative levels. to ensure timely and accurate information flow and feedback for the national M& E system. During the plan period. implementation agencies at the federal. regional and local levels should ensure that adequate human resources are provided and sutli cient M&E capacity development takes place to ensure the M&E system is operationally effective. To realize this objective. MoFED will work in close co llaboration with Bureau (s) of Finance and Economic Development (regiona l), woreda and city governments/ administrations to fac ilitate acce ss to techn ical assistance for M&E capac ity development.

10.4 CENSUS ES AN D SU RVEVS FOR T HE M & E S VSTE M The CSA's mandate is to gather socio-economic and demograph ic data through integrated censuses. surveys. continuous registration and administrative recording systems and compile. analyze and present to users useful data in user friendly formats. The CSA also provides techn ical support to government and other implementing bodies on statistical data keeping and builds capac ity continuously for registration. administrative data gathering. compilation. analysis and reporting systems. To fulfil its mandate the CSA has been implement ing the NSDS since 2009 . The NSDS has been revised to address the data needs o f GTP and it has defined strategic directions and designed an actio n plan to compil e and analyze data from censuses. surveys and admin istrative sources. For M&E of the progress towards ach ievement o f MDGs and the targets set in the GTP the CSA plans to conduct the following surveys during the plan period. Table 5 1. Su rveys 10 be Ca r r ied oul by CSA During Ihe Plan Period Ag ric ult ure . Nat ura l Resou rce a nd Pop ulati on S urveys Enviro nme nta l Stati stics I. Crop production forecast. I. Projcction of pop ulation and housing census - _. _ - - 2. Crop and livestock utilizatC;,-m- ,- ,-,,- ,-·,-. - - 2. Demographic and health Survey. 3. General agricultural practices survey. 3. Mid-term survey. 4. Land management survc)c. ~~- ,. 5. Agricultural production survey (' Mchcr' 5. Preparation for thc 20 17 national population and "Bclg' Seaso n). . -r- and housing ee ns us~ _ 6. Environment statistics. 6. Strengthen vital statistics. 7. Liv estock. po ultry and beehive survey. 125 Agric ulture, Natural Resour ce and Population Surveys Environmenta l Sta tistics --R~£~i£~~~~!_'.l!.-~~.~lJ"'-,---cc;---c-;---- 1. Update pop ulation census. 9. N<l~l:I!:<l!!~~~~~~~~_9.~i!9.-'~~,i~_~~lJ!~~r:...... 2. Undertake Demog raphic & Health Survey, 10. Pasroralist areas survey 3. Undertake intcr census study. I I . Rural economy survey. 4. Consolidate gender statistics. 5. Consolidate vital statistics, Household Sur veys and Pri ce Statistics Business Statistics _ --;IC,--;Agricultuml Prod ucers erice sun9': _ I. Large and medium scale manufacturing 2. Rcta i l _ p~c su rve)~s,.-,- _ ind ustries survey. _ _,,3'c -" Agri~u. !!.ll!<llJllP~t~~~ex ., _ __2:2~1I 1 !.!l.1 11.!l lJr~~L1~'.lg !.n~ ~l!i ~~~~> .~ _ _ _4. Wage i n~_~c ' -,.-,--c- - - - - - - - ~) i st~i bll~~~t~~~JI:~d_Y~..:!£e~~~r sll~~ex_._ _ 5. Consu m~~ p!:!ce i n~~c' _ 4. Conslru£,!i~2.l!.!.~)' 'c-r- _ 6. Global Co~p:arisonrro£!'.l....m,._-,. _ 5. Bu i ld i ng !?usi n~~~£~~!..lJ.·....:~ )'gcm . -,-_;-_ _ 7. Hou se hold income and consumption 6. Strengthening transport and communication _ _ _ s u~~~cY'.:.. _ statistics . s. Economr.i!nd soc~ 1 \\c!!.a!.e~~~e)'.. _ 9. C~nt inll£.s c.!!lE!!?)mc'!!.~ ncx _ 7. Str':!1gt~~_Il!!lg. eX~..!:!.Y'.l~.!:.~,!!i,g~~c · -,-_-,__ 10. Labour force surveyc' _ 8. Producers and amount index for manufacturing I I . Strect c~~ l d rc n sum?)· _ ind ustries. 12. Welfare monitoring survc)'c. _ 9. Survey on IT use on large and mcdium scale 13. Time utili/.ation su n'c~'c' _ manufacturing industries. _!Q~.~_L1r~'~): ~~,!!_ rt:l! ll_i n g _ ~~p.I()_~a.t i_(),ll: _ 11.Quarterly survey on large and medium _-:c~m,,"a n u faE~~Ji!l g !!,l ~u2t!i~:_ 12.Bu ild data base on water distillation and _ _~~t!i bu~i~n,c'_ _-, ;--,;-_;-_ 13.Sun cy on cottage industry and the informal sector. To achieve the above targets the following strategies will be implemented. Ensu re impl emen tat ion of statist ics law a nd guide lines: The strategy focuses on establishment of a unit to coordinate the National Statistical System. The unit' s purpose will be to estab lish common standards. classifications and definitions for all producers of official statistics. Improvin g data qu ali ty a nd sta ndards: The strategy will focus on improving data quality in the national statistica l system. Enha ncing advoca cy a nd use of statistic: The strategy aims to improve statist ical launch procedures and press relat ions. train statistical users including the media and establishing regular relations with data users. Methodologica l imp rovements a nd sta t istica l modern isat ion : The strategy aims to generate feedback from stakeholders' consultations. Ca pacity developments in the national statistica l system: The strategy aims to build stakeholders' capacity in the National Statistical System. Ens ure the NSDS is direct input for monitoring and evaluation of the GTP and oth er int er ventions: The strategy will focus on the responsibility of the NSDS for o fficial statistics, for instance. the adequacy of NSDS statist ics used by the GTP mon itoring systems will be checked. as well as the processes for quality assurance of mon itoring and evaluation surveys. 126 In addition, the follow ing system-wide data improve me nts will be implem ented Coordination of the national statistical sys te m: The strategy focu ses on ensuring statistica l ethic s, qual ity a nd sta ndards. The data qua lity standa rd agree ment endor sed by stakeholders is expected to be e ndorsed by the statistics co uncil and will then be imp leme nted, sutli c iently funded, we ll eq uipped and sta ff ed. Technology improvements: The ai m is to strengthen and enhance technology use, including utili zation of GPS , high speed portable computer, sate llite image ry and co mputer aide d tele phone data co llection. Mobilisation of support: Th e CSA wi ll mobili ze support for NS DS impleme ntation and will aim to achieve the Paris decla ratio n agreeme nts relating to national statistics . CSA will alig n and harmonize deve lopment partners' support for the NS DS and establ ish a com mittee to acco mp lish this task. Business Process Re-cnglneertng: Th e CSA is imp leme nting the Business Process Re- engineer ing proce ss and, in the proce ss. has ado pted many NSDS pro posa ls. The BPR doc ume nt co ntains an action plan and a performance management plan. The plan s will be eva luate d q uarte rly and an an nual repo rt presented to the statistics cou nci1. Statistical System Ca pa city building: A key implementation strategy invol ves a number of measure s that will be taken to build the capacity of statistica l systems du ring the plan period. All CSA ' s branch office s will be networked. The data collection, co mpilation and d isse mination system will be improved. Data ana lysis at branch offi ce level will be introduced. A statistica l data qua lity assurance doc ume nt for Ethiopia will be prepared. A data qua lity evaluatio n fram ework will be prepared. Data qua lity in each sector will be evaluated. Data producers a nd users will be trained . A catalogue for the NS DS will be pre pared and links between CSA and other web sites will be put in place. Postgrad uate leve l training for expe rts at the C SA will be prov ided and a new building to acco mmodate CSA wi ll be constructed. Grea te r empha sis will be give n to enhance the interna l capac ity of CSA field surveys fo r effective implementation and data management.

10.5 Geo-Information During the plan per iod. emphasis will be give n to build ing a nationa l gee-informa tio n system that is qua lity assure d and will gen era te co nsistent and usefu l geo-inforrnat ion. O nce the system is operational it will provide time ly and gee-information supported by air photography and rem ote sensing. 127