Thursday, February 29, 2024
BusinessTwo investors take industrial park lease

Two investors take industrial park lease

Industry Parks Development Corporation (IPDC) signed an agreement to install two manufacturers in Dire Dawa and Bole Lemi Industrial Parks with a total capital investment of 1.1 billion Birr.

The agreement was signed on Thursday October 22, 2021, between Sandokan Debebe, CEO of IPDC, and Dimitrius Kampouris, General Manager of Dimitrius Kampouris Plc, a garment manufacturer, and Bekele Abebe, CEO of EL Auto Engineering and Trading Plc., an auto assembler.

El Auto Engineering and Trading plans to install a car assembly plant on 18,600 square meters shed in Dire Dawa Industrial Park targeting both domestic and foreign markets. 

According to Sandokan, the agreement is a result of an effort to bring local companies into industrial parks since last year. The shed which is available to the car assembler is the first of its kind leased from the government-owned industry parks.

The Dire Dawa Industrial Park has a full range of services, creating a favorable environment for their production process, Bekele appreciates. He added that the park’s proximity to the Port of Djibouti helps enhance efficiency and effectiveness of manufacturers.

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EL Auto Engineering and Trading PLC is expected to invest 700 million Birr, creating temporary and permanent jobs for 400 citizens when it operates at full capacity. It was also mentioned that El Auto will avail 9,000 cars a year to the local and foreign markets.

EL Auto owns an auto assembly plant in a shed leased in the Chinese owned Eastern Industrial Park. For the past one year and a half, they were assembling vehicles for taxi services. They have delivered 500 JAC J4 2020 model vehicles for Taxiye, a ride hailing company which expanded its services to Nairobi recently.

IPDC has also signed an agreement to host a Greek company with 30 years of experience in the garment industry. During the signing, Sandokan Debebe said the company’s request for lease at the industrial park was accepted by the Corporation. He said he is confident that the company will complete the construction of its shed work in 15 months at Bole Lemi Industrial Park and embark on manufacturing.

The company has signed a contract to take over an 18,600 sq.m. plot of land within the park for the construction of the sheds. It is estimated that it will invest 486,540,000 Birr (USD 11 million) for the investment. Dimitrius Kampouris Plc (Kambotes) plans to hire more than 1,000 full-time employees when it starts full capacity operation.

Addisu Mamo, Transformation and Chief Executive officer at IPDC, told The Reporter that there are some investors and investment projects in the pipeline.

“We don’t have investment problems or reduction of investments with regard to governmental industrial parks” he said. 

Some investors are also expected to sign agreements with the Corporation in the coming week and investment flows are not a problem so far, according to the official. Of course, COVID-19 restrictions have limited the outreach and promotional activities last year, he added.

 “We are trying to minimize bureaucratic inefficiencies,” he said.

According to Addisu, all the sheds and industrial park compounds are equipped with facilities like waste management, telecom, and electric power infrastructure lines.

There are different price options for shed leasing contracts and IPDC rents its facility for up to 15 years. Investors like El Auto and Dimitrius pay a standard monthly rental price rate, which is a subsidized amount, not less than USD 3 per 1 square meter. Although such types of rental prices cannot return the investment, the government intends to support the manufacturing industry by improving the ecosystem.

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Video from Enat Bank Youtube Channel.

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