Assessment of Prospects and Challenges of Private Investment in the Achievements of Investment Policy Objectives in Central Oromia
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Date
2011-06
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Addis Ababa University
Abstract
This paper is endeavored mainly to access prospects and challenges oj private investment in the
Achievement oj private investment policy objectives. It was also aimed at investigating responses that
contribute Jor minimizing the challenges and strengthening private investment success in central Oromia.
Despite the government's effort a number oj investors, investment growth rate and its contribution is still
Jar below the level required Jor the achievement oj private investment objectives. At the national level
only 11.5% are under operational level, whereas, at Regional and study area only8%and 16% out oJthe
total approved projects are at operational level respectively. The level oj private investment activity is
Jundamental to poverty reduction, economic growth and achievement oj investment objectives or
development in general. This concern pOinted to the need Jor IInder taking in-depth assessment. To this
end case study design and descriptive approach were applied. Different: related literature, proclamations
publications, reports were reviewed, to obtain secondary data. Different pertinent groups oj people oj the
area in Jocus were questioned and interviewed. Standardized statistical Jormula was applied to determine
the number oj samples Fom investors (375 Fom 4169}.Then stratified sampling was used to select
proportionate samples Fom each and every sector. Likewise to select experts (18) and slOck holders (18)
working in the area, purposive sampling technique was used data required Jrom these samples were
collected using Questionnaire that constitutes both close ended and open-ended Jorm investor samples,
structured interview Jor experts working at different ladder oj the office and KII Jrom the stack holders.
The data collected Fom both sources was both qualitative and quantitative in nature and were analyzed
qualitatively through description and quantitatively through simple descriptive statistics. The Research
came up with the result that illustrated the existence oj both prospects and challenges. From among the
challenges, Jailure to clearly identifY and prepare investment land in advance and keep in the land bank,
the land was searched after the request had received, hence there is problem oj land access, shortage
budget Jor land compensation; inFastructure problem, where Fee land is available; lengthy procedure oj
land decision be land cause oj disintegration components oj a task in to five or more sectors, lack oj
proper knowledge on investment policies, lack oj commitment, the existence oj some un ethical and
irresponsible experts in investment offices and corruption are the main ones. Some others related with
investors are: Jail to have genuine plan, weak financial capacity, and insufficient experience, having
speculator/ rent seekers/ behavior; unable to use Jull capacity and carry their obligation; un willing to
hire proJessional experts and non proJessionals as per their plan are the major.
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Keywords
Prospects and Challenges of Private Investment