Ethiopia’s construction industry has experienced rapid growth over the past decade and is poised to expand further. Currently accounting for 4% of GDP, the sector contributes significantly to employment and economic activity across the country.
Major public and private construction projects are transforming Ethiopia’s infrastructure landscape. The government has committed over $150 billion towards transportation, energy, industrial zones, and urban development initiatives through 2030. Billions have already been invested in new highways, rail lines, airports, dams and power plants. Additional spending on housing, hospitals, schools and commercial buildings is also stimulating growth.
Private sector participation is increasing as well. Several industrial parks have been established to manufacture goods for export. Real estate development is booming in Addis Ababa and other cities to meet the needs of a young, urbanizing population. Regional construction hubs are emerging around major public works. All told, the industry is projected to increase 8% annually through 2026.
Challenges remain such as access to financing, a shortage of skilled labor, and disruptions from the pandemic. However, the government is working to address constraints through reforms, training programs and post-COVID stimulus spending on infrastructure. New regulations also aim to boost quality, safety and sustainability standards across the sector.
As Ethiopia strives to achieve lower middle income status by 2025, continued expansion of the construction industry will be critical. With its expertise in project management, planning and workforce development, Ruskin Felix Consulting can play an advisory role in supporting Ethiopia’s ambitious development goals. Partnerships with leading firms would transfer knowledge and best practices to maximize local economic opportunities in this high growth sector.