Ethiopia: Govt to Launch Construction Industry Policy

In a bid to introduce the first ever legal framework for the construction sector, the Ministry of Urban Development & Construction (MoUDC) is in the final stages of launching the construction industry development policy. The policy, which has taken year and a half to prepare, will be tabled to the Council of Ministers, this week, for approval.

The final draft of the policy, together with the draft proclamations to establish the Construction Industry Council and the draft Construction Industry Licensing Proclamation were also presented to stakeholders during the two-day meeting, chaired by Mekuria Haile, minister of the MoUDC, at the Hilton Hotel. The meeting commenced on Tuesday, September 17, 2013.

During the meeting, Mekuria unveiled the Ministry's intention to send the draft proclamations to the Council of Ministers together with the policy.

The construction policy that will be implemented by the MoUDC primarily - as noted in the 65-page draft policy document - will focus on regulating the sector. Until now, it has been directed by various guidelines, which are not able to keep up with the construction sector boom.

The legal framework surrounding the construction sector inEthiopiahas been led by the development strategy, introduced 12 years ago by the former Ministry of Works & Urban Development (MWUD). This, according to the draft policy document, has caused lag in the sector's growth, with view to time keeping, quality and soaring prices.

"The policy that will be implemented in the current fiscal year is designed to overcome multifarious problems in the construction sector, since the sector has taken a great stake in the Growth & Transformation Plan (GTP)," Mekuria said.

Although the contribution of the sector to the national economy increased to 5.3pc, from three percent two years ago, it is still below the average contribution of the sector for the gross domestic product (GDP) of most Sub Saharan African countries - which is six percent.

In order to improve this, the policy identified nine priority areas to focus on.

Out of the nine areas, the soon to be established Construction Industry Council will be responsible for introducing modern construction technologies and management systems, as well as settle professionalism in the sector.

The Council's first task will be preparing a guideline based on which every contractor and consultant will produce its own code of conduct, in order to operate in the sector.

The Construction Projects Management Institute - which was established a month ago parallel to the preparation of the policy by Construction Industry Development & Regulatory Directorate at the Ministry - is tasked with initiating action plans to facilitate the introduction of competitive construction project management systems and identify gaps in the current construction project management.

"Nowadays, the sector is characterised by low performance, lack of quality, poor time management and the inflated price of construction inputs," Yoseph Birru, (PhD), general director of the Institute, told Fortune.

"Consequently, this has been slowing down the pace in the execution of development projects according to their deadline," Yoseph, who presented the contents of the draft policy document at the meeting, stated.

According to Yoseph, the preparation of the policy emanates from the government's need to create a conducive environment in the sector. This should enable it to overcome the multiple issues and sustain the swift economic growth of country.

To this end, the Institute will give training in project management to professionals trained as architects and engineers, according to the establishment proclamation. The model for the Institute was taken fromIndia,South Africa,Nigeriaand theUnited States.

The new Construction Industry Licensing Proclamation will help the Ministry to re-register companies engaged in the construction sector. The registration process, according to the draft proclamation, requires companies to submit competency certificates, unlike the current practice.

However, according to a senior member of the Ethiopian Construction Contractors Association, who have been engaged in the sector for the last 30 years, the organisational structure and accountability of these institutions might create a problem when it comes to implementing the policy.

"We suggested that the MoUDC establish the Council independently from the Ministry and to be accountable to the Prime Minister directly," the member of the Association told Fortune.

This, according to him, might not be acceptable to most of the companies engaged in the sector. This is since most of them are not confident in the Ministry's ability to resolve their problems.

Source :

Posted on : 30 Nov,-0001

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