Industrialization And Tariff Protection In Ethiopia

Industrializa tion in Ethiopia is a recent Phenomenon. ThernEontribution of the manufacturing sector in terms of GDP, Employment,rnexport earnings , Etc. Is very Small. The manufacturing industriesrnemphasise the production of non- durable consumer goods.rnin Ethiopia , Tariff Protect ion is an important instrumentrnemployed by the government to encourage the domestic industries.rnthe objective of this ,study is, Among other things , ( 1 ) to assessrnthe effectiveness of tariff protection, (2) to identify whichrnindustries or group of industries the' policy favors and the Possiblernconsequences of the policy and (3) to estimate the domestic resourcerncot of saving a unit of Foreign exchange.rnthe findings show that the pattern of protection in EthiopiarnFavors consumer goods production. These are the oldest group ofrnindustries in the history of manufacturing in the country. However,rnthey are still protected highly. This is a sign of inefficiency.rnthe findings also reveal that tariff rate setting in Ethiopia is arncase-by - case approach. There is no branches.. The domestic resource costrnestimation shows that the domestic factor endowments do not suit tornthe production of some products.rnProtection by itself does not necessarily lead to inefficiency rnwhat is important is the dosage and type of industries to be protected.

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