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Plastic industry in Ethiopia – Opportunities for small-scale producers


The country is one of the fastest-growing economies. Ethiopia has made a significant progress in industrialization. The Ethiopian government has embarked on a policy aiming to invite as many overseas investors as possible to the country.

Industrialization will contribute to the economy of Ethiopia through a large number of small production units. The industrial sector contributes among others to the expansion of employment opportunities, output and export and fosters entrepreneurship. Industry is also one of the pillars through which the socio-economic objectives of balancing development in rural, semi-urban areas.

Ethiopia is Africa’s second most populous country having wide range of market for industrial productions. Industries are indicators of economic growth and the key drivers of innovations and development.

Plastic industry is one sub-sector that promotes innovations. In the context of Ethiopia there is a large scope for the production and distribution of plastic to the national and international market.

In recent years, plastic materials have become important inputs for a wide range of innovations and applications in automotive, railway transport, defense & aerospace, medical and healthcare, electrical & electronics, telecommunication, building, infrastructure and furniture fields.

Advancement of the plastic industry will be a new opportunity in Ethiopia for balancing development in the country because plastic industry is inherently associated with small production and distribution for domestic consumption.

Worldwide, plastic product consumption is estimated to grow on average by 5per cent and it will touch a figure of 227 million tons by 2015.

Asia has been world’s largest plastics consumer for several years, accounting for about 30 per cent of the global consumption excluding Japan, which has share of about 6.5per cent . Next to Asia is North America with 26per cent share, then Western Europe with 23 per cent share in the global market. Worldwide Plastics Industry witnessed a steady growth in the year 2007 which is reflected in the increased consumption figures of all types of plastics materials. Thus, expanding plastic industries in Ethiopia will be advantageous for it will have large domestic markets.

Plastic is a material of any wide range of_synthetic_or semi-synthetic_solids that are_moldable. Plastic comes from the Greek term ‘Plastikos’ that means, ‘to form’. It was named this because it could be shaped in many ways, by simply heating and cooling it.

Chemically plastics are typically_organic polymers_of high_molecular mass, but they often contain other substances. They are usually synthetic, most commonly derived from_petrochemicals but many are partially natural. Most plastics contain_organic_polymers. The vast majority of these polymers are based on chains of_carbon_atoms alone or with oxygen,_sulfur, or_nitrogen_as well. This fine tuning of the properties of the polymer by repeating unit's molecular structure has allowed plastics to become an indispensable part of the twenty-first century world.

One of the key functions of plastic products is packaging, which according to evidences accounts for over 35 per cent of the global plastic products consumption. Amongst the individual Plastics Materials, the type known as Polyolefin accounted for 53 per cent of the total consumption, followed by PVC which accounts for 16.5 per cent. Other plastic packaging materials through applying high level engineering, and specialty plastics, blends, alloys, thermosetting plastics account for is 13 per cent.

Plastic is playing a significant role in the lifestyle of the 21st century. At present, the global GDP is estimated around US $ 32 trillion out of which, the value of chemical output alone contributes 5 per cent. Plastic commodities contribute US $ 90 billion that is 5.6 per cent of the entire chemical output. This gives readers an idea of the size of plastic industry and the significance that it holds in the global context. This is particularly true of the global polymer industry which is growing fast year after year. The demand for the major polymers is growing at a rate of 5.2 per cent annually and polyolefin alone makes up for the 63 per cent of the entire polymer industry.

There are tremendous opportunities for expansion of polymers products all over the world. At present, the global capacity for polymer production is growing at a rate of 10.5 per cent per annum. More than 35 per cent of the global capacity is in Asia – pacific region while around 28 per cent of the capacity is in the North America.

Asia is one of the fastest growing regions of the world. In the early nineties, the growth rate of the entire region (real GDP) was more than 9 per cent (without Japan). There was a slump in the mid-nineties due to the Asian crisis. But the region has recovered well in the recent times and the growth rate of the region is around 6 per cent. China and India are the two major countries in the region with a growth rate of 10 per cent and 5.5 per cent respectively. Of the global GDP, around 27 per cent of the share comes from Asia and this is increasing steadily since the past few years.

The Asian region is also attracting more than 50 per cent of the new business opportunities of the entire globe. The demand for major polymers in the region is growing by more than seven per cent per annum. Similarly,the demand for Polyolefin is growing at with similar rate. Economically China and India are expected to play a major role in the Asian region in the future.

After Ethiopia introduced market led economic strategy the economy has been growing fast. The monetary policy the government pursues is also favourable for investment and industrial development. This has helped the industry sector to grow phenomenally. Plastic industry is one of the industries, which has tremendous opportunities in the near future.

The plastic industry is also beneficiary of the new and emerging technological innovations. In this respect nanotechnology is an exciting technological advancement that has the potential to contribute significantly to the future of plastic industry. Through nanotechnology, special Nano composites can be created that will be more dent-, heat- and scratch-resistant. Yet, the thermoplastic resins used to create the plastic can still be processed with the same equipment as used to process resins.

The large tonnage of commodity plastics is mainly used for packaging. PVC is mostly used for durable and infrastructure applications in building construction and public works. Engineering plastics and ABS are mainly used in automobile and electrical industry in the broadest sense, including appliances, telecommunications, Radio-TV etc. The fastest growing applications are in packaging, and PET bottles. In building construction, plastics are only 1-3 per cent of the total material tonnage, but at least 10 per cent of the total value, mainly in secondary construction. The fastest growing plastic markets in building construction are pipes, windows, and doors and geo textiles in public works. The electrical industry is another major consumer of plastics with cables and wires. There is rapid growth of applications in agriculture and consumer goods too.

The Major plastic groups are Polyethylene Terephalate (PET or PETE) – used in soft drink, juice, water, beer, mouthwash, peanut butter, salad dressing, detergent and cleaner containers. High density polyethylene (HDPE) – Used in opaque milk, water, and juice containers, bleach, detergent and shampoo bottles, garbage bags, yogurt and margarine tubs and cereal box liners. Polyvinyl chloride (V or Vinyl or PVC) – used in toys, clear food and non-food packaging like cling wrap, some squeeze bottles, shampoo bottles, cooking oil and peanut butter jars, detergent and window cleaner bottles, shower curtains, medical tubing, and numerous construction products such as piping. Low density polyethylene (LDPE) – used in grocery store, dry cleaning, bread and frozen food bags, most plastic wraps, squeezable bottles, such as for honey or mustard. Polypropylene (PP) – used in ketchup bottles, yogurt and margarine tubs, medicine and syrup bottles, straws and opaque plastic containers, including baby bottles. Polystyrene (PS) – used in Styrofoam containers, egg cartons, disposable cups and bowls, take-out food containers, plastic cutlery and compact disc cases.

A linear relationship between population growth and consumption, especially in packing materials are the back bone for retail trades.. For instance, in places like Robe (Located in South Central of Ethiopia), per capita consumption is growing. Someone buying one birr worth of Karya (green pepper) will need a plastic bag (which is commonly known in Amharic as festhal).

Plastic products are not without problems. There is of course a growing concern in the use and disposal of plastic materials. Plastic are usually thrown on the road and as a result of which environmental stakes are very high.

United Nations Joint Group of Experts on the Scientific Aspects of Marine Pollution estimated that up to 80per cent of the pollution was land-based. Eighty per cent of marine debris is plastic._Plastics accumulate because they typically don't_biodegrade_as many other substances. Plastic waste has reached all the world's oceans. This pollution harms an estimated 100,000 sea turtles and marine mammals and 1,000,000 sea creatures each year.

Worldwide plastics industry witnessed a steady growth since the year 2007 as it is reflected in the increased consumption rate of all types of plastics materials.

Plastic industry in Ethiopia is already attracting investors from overseas. In this respect the importance of small industries is expected to be high. It can also be a source of both growth and diversification. The role of small Enterprises was adequately realized long back. These industries are particularly suited for the better utilization of local resources and for the achievement of local self-sufficiency in respect of certain types of essential consumer goods.

Japan is usually considered as the great example of what can be done in this way and now, even China is said to be following a similar path, at least in the rural areas. Presently in no country in African except in Ethiopia, has industrialization received a strong policy support. It is true that small scale sector is considered to be an appropriate and most effective instrument for industrialization in many developing economies.

Ethiopia has a range of business doing opportunities around the country and at the same time ample scope for industrial investment. Presently, Small Scale Plastic industry in Ethiopia has noteworthy contribution. The industry is also believed to provide opportunities ahead as the country continues to grow.



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0 #11 million deneke 2014-12-29 14:53
:Dear sir, I kindly beseech your ever lasting assistance to make know, if there are importers of chemicals for the production of detergent in Ethiopia.? If any is there any way I could get their contact addresses or other relevant information
0 #10 Million Deneke 2014-12-29 14:43
:Dear sirs, I kindly request your sympathy to inform me the list and contact address of companies that are engaged in the production of gee pee containers
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0 #5 Mukesh Sharan 2014-03-30 07:12
It's a Good Market Analysis report....I am looking for importers of polymers in Ethiopia.
-1 #4 Gebregeorges Mitiku 2013-12-16 15:54
Even if I am 4th year chemical engineering student in aait, after graduation I will put my hand on plastic industry for further processesing with best quantity.

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