In 2010 Ethiopia launched a five year, multi-sectoral plan to bring the country to middle-income status, known as the Growth and Transformation Plan (GTP). Since 2011, Ethiopia's Climate Resilient Green Economy (CRGE) strategy has run alongside the GTP; its aim is to identify green economy opportunities to bring about high growth targets while keeping greenhouse gas emissions low. It also aims to build resilience in the country's economy and social infrastructure.

Reducing carbon emissions whilst maintaining economic growth is challenging, but Ethiopia has ambitious goals and has already broken new ground in sustainable development practice through aligning the GTP with the CRGE. However, systematic interactions and linkages with wider industrial policy within the GTP need strengthening. Since the launch of the CRGE, significant institutional, financial and technical support has been devoted to streamlining the green economy approach in all sectors. While good progress has been made in some sectors, notably agriculture and energy, there has been little integration of the strategy in industry mainly as a result of weak institutional capacity.

The next GTP (GTP-2; 2015-2020) is currently under formulation and is expected to maintain the vision of the existing GTP, with higher priority given to the greening agenda, among other issues. This provides an opportunity for practical policy recommendations to be developed to streamline the CRGE strategy with Ethiopia's industrial sector strategy in the coming 5-year development plan.

This project aimed to better understand the interaction between emerging industrial policies and green economy strategies in Ethiopia, with a view to supporting concrete policy reforms that are in line with Ethiopia’s green economy ambitions and governance context. Acquiring an understanding of the synergies, conflicts, trade-offs and multiplier effects of industrial policies and green economy strategies, the research has informed discussion on pathways to industrial development and the policy roadmaps available to Ethiopia. The project explored: opportunities, barriers and options for realising the alignment of the CRGE with national industrial policies and programmes; opportunities and barriers for greening industries; options for aligning institutional arrangements for governing industrial growth and the green economy; and the character and drivers of the emerging national innovation system, and its suitability for nurturing green industrial development.

The project was led by Yacob Mulugetta at University College London, in partnership with Quantum Global Research Lab, the University of Reading and the Ethiopian Development Research Institute.

CDKN Funding: £370,000

Image credit: Rémi Kahane, GlobalHort