Strengthening Business-to-Business Linkages in Ethiopia: A Guidebook for Chambers and other Business Membership Organizations

06.08.2021 | CIPE East Africa Regional Office in Addis Ababa

Click here to download the Strengthening Business-to-Business Linkages Guidebook.

Supporting inclusive industrialization is a rising policy issue across Africa. In Ethiopia, the influx of international investors in newly established industrial parks presents an untapped opportunity to connect small and medium-sized enterprises (SMEs) to global value chains. While establishing fully serviced industrial parks is a major component of Ethiopia’s industrialization strategy, links between these industrial parks – each of which provides tens of thousands of jobs – and the local community remain underdeveloped.

As natural representatives and convenors of the business community, business associations are well positioned to be super-connectors between local SMEs and companies in Ethiopia’s growing industrial parks. Through the creation of business linkages, business associations can help ensure that investments are sustainably integrated into local economies and communities. CIPE and the Economic Transformations Group (ETG) worked closely with Ethiopian business membership organizations (BMOs) to develop and validate this guidebook’s proposed solutions, building on lessons learned from CIPE’s work facilitating business-to-business (B2B) supply chain linkages in Hawassa, home to one of Ethiopia’s flagship industrial parks.

This guidebook aims to help Ethiopian business associations facilitate constructive conversations between local businesses and international companies working within Ethiopia’s industrial parks about opportunities to work together. To outline the process, CIPE has created a three stage, thirteen-step practical framework to guide business membership organizations (BMOs) – some of the most well-connected and representative networks in the country – through helping local businesses strengthen B2B linkages with international investors in industrial parks. This toolkit walks BMOs through the requirements of international investors and local sellers, building connections between each, and assessing progress.

Each of this guidebook’s sections provide an overview of best practices and common pitfalls for BMOs supporting the growth of B2B linkages as well as accompanying case studies from around the world. Organizations working on inclusive industrialization across the continent can benefit from the guidebook’s global case studies and lessons learned from Ethiopia. Following a brief introduction to the concept of B2B linkages, this guidebook dives right into the three stages of supporting increased business linkages to maximize inclusive growth and connectivity between industrial parks and SMEs from surrounding communities:

  • Stage One Starting Out: Stage One covers the basics of getting started in developing business linkages, with a focus on individual relationship building and forming a strong understanding of what both buyers and local suppliers want.
  • Stage Two – Supporting Suppliers: Stage Two takes a closer look at fundamental activities BMOs can do to help suppliers make contact with foreign direct investors, understand their buying needs and requirements, and foster lasting relationships between buyers and suppliers.
  • Stage Three – Follow-Up: Stage Three looks to the future and emphasizes the importance of maintaining B2B relationships through consistent follow-up, monitoring and evaluation, and an examination of system-wide challenges in the current business environment that BMOs can address through support of policy advocacy and reform.

An Amharic translation of this resource is forthcoming.

Click here to download the Strengthening Business-to-Business Linkages Guidebook.