Corporatization in Ethiopia: A Move Towards Coping with Globalization and Accession to the WTO

No Thumbnail Available



Journal Title

Journal ISSN

Volume Title


Addis Ababa University


7fJe last three decades, facilitated chiefly by the sophisticated transport and communication technology, have markedly exhibited an nnprecedented flow of products and capital. This is what is referred as economic globalization. The economic integration process has been pioneered by the interllational economic organizations (i.e. the IMF, World Bank and the WTO), but in the face of shaking critics. Of conrse, available empirical evidences also brought to the surjilce not only the positive results but also the scenarios whereby economic globalization failed to enhallce, ifnot aggravated, the poor living cOlleliliollS and hampered fit/ure de"e/opment potentials of the poor. So far, the influence of the global South in governance of the international economic order has been velY limited so that it has by and large dominated by the rich powers. In fact the share of the South in the global economic operations in terms of cross border trade and investment has also been inSignificant. Ethiopia as part of the international c011lIJulIIily has beell ulldertaking the integratioll experimellt sillee 1991. It in particlliar introduced liberal trade and investment reforms. It is also acceding to the rlllebased lIIultiiateral trading system (i.e. the WTO). Nonetheless, as different econometric studies uncover, its peljorm(fllce in harnessing the lIoll-reciprocal preferential market accesses has been ulIsatisjactoJY suggestiug the cOllllotatioll of becoJlJillg a WTO member ulliess it embarks 011 large scale export-oriented production. lvioreover, FDJ's role in Harrowing the low level of domestic savings (Ind supplementing investment endeavors has been at a rudimentmy level. To the worst, increased FDJ injlows and maximum benefits ji'om it demand Ethiopia to reach a level of developmellt by its own effort. PreCisely, it is ill voluntmy for Ethiopia to marshal export-oriented productioll and total jilctor productivity shonld it cope with ecollomic globalization and accession to the WTo. If the question turns out to be how to chmmel the scarce material and human resources to meaningful busiffesses, it is argued ill this thesis that Ethiopia should promote corporate businesses thall ever. Despite the low level of contributions of the lIIodern private sector to Ethiopia's economy and the immature culture of iJlcOJ1JOralioJl could restrain development of sllch ventures in the short-run, it has become certain that 10 promole internationally competitive firms ill cOJ1Jorate lines, the government of Ethiopia shollld undertake some essential legal and institutional reforms.



Corporatization in Ethiopia