Integrating Sustainable Development Goals in Ethiopia’s Industrial Parks: Progress, Gaps, and Policy Priorities

Abstract

Executive Summary 

The main objective of this policy brief is to assess the extent and challenges of integrating sustainable development goals (SDGs) into the operations of firms within industrial parks (IPs). Specifically, the brief aims to evaluate progress, identify gaps, and prioritize policy actions. The policy brief focused on gender, decent work, the linkage between IP firms and the host economy, and combating climate change or environmental sustainability. To address these objectives, this study employed a cross-sectional research design utilizing both primary and secondary data sources to gather necessary information. The study revealed several significant issues regarding the integration of SDGs at the national level and within firms operating in IPs: (1) Ethiopia’s previous national development plan (Growth and Transformation Plan II) achieved an overall alignment score of 78.4. (2) Despite many firms recognizing the importance of setting SDG targets and beginning to align their operations accordingly, and many companies making significant efforts to promote gender equality and strengthen links with the local economy, most industrial parks still show significant gaps in the integration of SDGs into their daily business operations: (i) many firms are lagging particularly in Decent Work and Climate Action, with issues such as unfair pay, weak worker protections, and poor environmental practices. (ii) Only about 48% of firms have initiated operations toward SDG targets, and most lack clear goals. Additionally, approximately 71% of employees report as they never received SDG-related training. (3) The study also identified key barriers, including lack of leadership commitment, unclear regulations regarding SDG targets, low awareness of SDGs among firms, and ambiguous policies. (4) Finally based on our evidence, this policy brief suggests efforts to be made to enhance leadership commitment, setting clear regulations and policies, work on capacity building, strengthening local economy linkages, and implementing environmental and climate action measures.