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Title: The Performance of the Ethiopian Leather Sector in the Intra-COMESA Export Trade: Lack of Information as Explanatory Variable
Authors: Yimam, Dereje
Advisors: Dr. Meheret Ayenew
Copyright: 2004
Date Added: 21-Apr-2008
Publisher: Addis Ababa University
Abstract: Ethiopia is a member of the Common Market for Eastern and Southern Africa (COMESA). The country is not only a signatory but also a founding member to the regional organization. Being a member and signatory of the respective protocols, the country is expected to be benefited from the possible opportunities in the region and the services rendered by the organization. One of the areas Ethiopia is considered to have a comparative advantage in the region is the leather industry for the country is endowed with its livestock resource more than many of the African countries. Yet the performance of the country in the intra-COMESA export trade is not only minimal but also non-existent, especially in the leather sector. Many researchers identified various reasons to explain the low performance. On the other hand, some firms have been able to sell their products, while others are benefited from the COMESA service like the PTA Bank by making little efforts to access the market and the services of the organization. The purpose of this study is to evaluate, other things remaining equal, lack of information on the market structure of the region, the services of COMESA and various agreements like the tariff reduction arrangement among member counties as an explanatory variable to the low performance of the sector in the intra-COMESA trade. Of the total 28 firms engaged in the export trade of semi processed and finished leather products some 11 (42%) are taken for the survey. Add to this some 8 of governmental and nongovernmental organizations that have direct relations to COMESA that are supposed to have the responsibility of disseminating the required information to the end user firms are also taken for the study. Formal questionnaire, interviews, discussions as well as document reviews are made to access the required information for the study. Accordingly, the research has come up with the following findings: − Almost all firms have no adequate information on market structure of the region, the services rendered by COMESA and various treaties among member countries. − Almost all firms are lacking the required organizational information system as measured by the hardware, software and personnel. vii − The strategies of the firms towards finding possible opportunities in the region and the organization (COMESA) are so weak. − The marketing and communication systems of all the firms studied still traditional and limited to few European and Far East countries. − The responsible governmental and non-governmental bodies are not fully exercising the responsibilities and duties in this respect. − Lack of commitment and efficient organizational capability and the prejudice towards the region’s potential and the organization opportunities are found to be the major problems concerning these governmental and non-governmental bodies. − The standards of the Ethiopian telecommunication facilities are below the African average in many indicators. Therefore, the study underlines the following possible suggestions and recommendations. For fully utilizing COMESA services there is a need to create awareness about the potential opportunities of the COMESA region and the organization by the responsible bodies in the governmental and non-governmental organizations. To this end, the full commitment of the government and its institutions, in wide-ranging activities to support the business community for creating awareness on the rules, regulations, opportunities and the services of COMESA, for which the government is signatory is very indispensable. Therefore, is recommended that a separate governmental body that may execute information on COMESA matters required to be established. In this connection, there is a need to build the capacities of the non-governmental organizations that have direct relation with the business like the Chamber of Commerce, the Ethiopian Tanners Association and the Leather and the Leather Products Institute in gathering, sharing and disseminating required information. On the other hand, the end user firms in the sector need to strengthen their organizational Management Information System in terms of hardware, software and personnel. Moreover, they are expected to see beyond their traditional customers and look for new outlets and systems. Finally, there is a crucial need to improve the standards of services of the Ethiopian communication facilities and expand its direct telecom connections into the COMESA region.
Description: A Thesis submitted to the school of graduate studies of Addis Ababa University in partial fulfillment of the requirements for the degree of Master of Arts in Regional and Local Development Studies (RLDS)
URI: http://hdl.handle.net/123456789/773
Appears in:Thesis - Regional and Local Development

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