Made in Africa: Industrial Policy in Ethiopia
by Dr Arkebe Oqubay
OUP, 2015, 384p; £55.00
For years, African countries have been told that the road to industrialization is long and full of intractable obstacles. This view has now been challenged in a book written by someone who has been at the centre of policymaking in one of the continent’s fastest-growing economies — Ethiopia — for more than two decades.
The book is an insightful scholarly work based on detailed research covering three important economic sectors in Ethiopia: cement, floriculture, and leather and leather products.
Although the book concerns industrial policymaking in Ethiopia, the findings and policy conclusions “have a wider relevance beyond Ethiopia”. In fact, the originality and the value addition of the book lie in its implications for other African countries and in the lessons it offers to those engaged in policy formulation and implementation.
Using concrete examples, the book demonstrates that industrial policies work better when they are designed to be sector-specific. In other words, policies that work in one industry or sector may not necessarily work in another.
These are significant and useful policy messages, but the book’s most striking and perhaps most original contribution is how the author links all these findings with the importance of “policy independence”, which enables a developmental state to learn by doing, by copying and by making mistakes and learning from failure. “Government policy learning” as well as “collective learning” of government and key stakeholders in the economy is seen as critical for effective policy formulation and implementation.
Indeed, the book’s ultimate message can be summarized as follows: Active industrial policy based on continuous policy learning is a sine qua non for diversification into more dynamic sectors such as manufacturing. Manufacturing in turn is critical for economic transformation because it lends itself to productivity improvements and learning by doing, and because of its potential for linkages and economies of scale.
The author’s overall message for African countries is simple: know where you want to go first, and with a development-focused proactive state willing to keep its policy independence and to learn from others and its own mistakes, you will reach your destination.
In other words, determine your own destiny and don’t expect others to do it for you. This book should thus be required reading for policymakers in Africa.
Taffere Tesfachew is the director, Division for Africa, LDCs and Special Programmes, UN Conference on Trade and Development (UNCTAD).