Industry, Innovation and Infrastructure

A once-in-a-century crisis—a Great Disruption unleashed by a viral pandemic—hit the world economy in 2020. The pandemic spread like a forest fire reaching every corner of the world infecting more than 90 million and killing close to 2 million people worldwide. For several months uncertainties and panic paralysed most economic activities in both developed and developing economies. Trade and tourism came to a grinding halt while job and output losses exceeded levels seen in any previous crisis. In a matter of months the number of people living in poverty increased sharply while income and wealth inequality trended towards new highs.

The World Economic Situation and Prospects 2021 is a report produced by the United Nations Department of Economic and Social Affairs (UN DESA) in partnership with the United Nations Conference on Trade and Development (UNCTAD) and Economic Commission for Africa (UNECA) Economic Commission for Europe (UNECE) Economic Commission for Latin America and the Caribbean (UNECLAC) Economic and Social Commission for Asia and the Pacific (UNESCAP) and Economic and Social Commission for Western Asia (UNESCWA).

This is the United Nations definitive report on the state of the world economy providing global and regional economic outlook for 2020 and 2021. A once-in-a-century crisis—a Great Disruption unleashed by a viral pandemic—hit the world economy in 2020. The pandemic spread like a forest fire reaching every corner of the world infecting more than 90 million and killing close to 2 million people worldwide. For several months uncertainties and panic paralysed most economic activities in both developed and developing economies. Trade and tourism came to a grinding halt while job and output losses exceeded levels seen in any previous crisis. In a matter of months the number of people living in poverty increased sharply while income and wealth inequality trended towards new highs. Governments around the world responded rapidly—and boldly—to stem the health and economic contagion of the crisis. Fiscal and monetary stimulus packages were quickly rolled out to save the economy. The crisis responses however entailed difficult choices between saving lives and saving livelihoods between speed of delivery and efficiency and between short-term costs and long-term impacts. Limited fiscal space and high levels of public debt constrained the ability of many developing countries to roll out sufficiently large stimulus packages. This report was produced by the Department of Economic and Social Affairs the five United Nations regional commissions the United Nations Conference on Trade and Development with contributions from the UN World Tourism Organization and other intergovernmental agencies.

The textile and apparel industry is one of the three priority areas that the Government of Ethiopia has identified for export-oriented activities – along with leather products and agroprocessing. Export-oriented manufacturing activities are expected to stimulate local technological development through linkages between foreign and local enterprises and provide the incentive that engagement in highly competitive export trade generates for learning and acquiring the technical skills and knowledge necessary to produce higher-value more sophisticated and high-quality products.

The innovative activities that enable countries to move up the productivity technology and value ladder typically take place at the firm level but a firm usually does not innovate in isolation. Innovation depends upon a wider system comprising diverse actors and their interaction as well as the policy framework covering various policy domains. At the national level the National Innovation System (NIS) strongly shapes the country’s technological development and innovation performance.

UNCTAD Science Technology and Innovation Policy Reviews (STIP Reviews) are an analytical and policy learning process for a country’s science technology and innovation (STI) stakeholders to reach a clearer understanding of the key strengths and weaknesses of their innovation systems and identify strategic priorities for its development. The result of this process is documented in the STIP Review document and considered at the United Nations Commission on Science and Technology for Development (CSTD).

The STIP Review of Ethiopia was prepared by the Division on Technology and Logistics of UNCTAD under the overall guidance of Shamika Sirimanne Director. The report was prepared by Clovis Freire and Michael Lim (UNCTAD) Mulu Gebreeyesus Senior Researcher at the Ethiopian Development Research Institute and Taffere Tesfachew Principal Adviser Ethiopian Investment Commission Member of the United Nations Committee for Development Policy and Member of STIxNET (UNCTAD) who was the lead consultant for the STIP Review and played an instrumental role in the drafting and successful completion of this report.