ABSTRACT
The prime objective of industrialisation is to bring about structural change – a change from backward/traditional techniques of producing goods and services to a knowledge based industrial production system. Thus any treatise of an industrialisation strategy inevitably needs to investigate the structure of the relevant economy. The Ethiopian economy is still deeply traditional. Not only production and service activities in agriculture are traditional, but even non-agricultural sectors, such as manufacturing, trade, etc., are characterised by activities involving large unskilled labour and animal power. A study on the private sector economic activities in 2007 revealed that for a ten-year average, 1995/96-2004/05, traditional economic activities account for about 60 per cent of the national income (Teshome and Belete, 2007).1 Table 7.1 portrays the structure of the economy at an aggregate level. Over the five-year period, agriculture, which is entirely dependent on weather conditions, unskilled labour and animal draught power, accounts, on average, for nearly half (48.4 per cent) of the gross domestic product (GDP).2 On the other hand, manufacturing, which involves largely partially automated activities, has a share of less than 5 per cent. The relative shares of other modern sectors, such as finance, construction, power, etc., are respectively quite small.
