Evolution of Industrial Revolution And

The Trends Of Industrialization in Our

Region

Presentation by:- BontuTeshome (Eng.)

Guraandhala, 2015
Adaamaa
3/7/2023 1
 Contents
 Terminologies
 Introduction to Manufacturing Industry and
Industrialization
 Evolution of Manufacturing Industry (Industrial
Revolutions)
 The Benefits(roles) of Industrialization
 Tools to Implement Industrial Development
 What is Our Role Industrial Development
 Key Performance Indicators
 Manufacturing Industry Trends In Our Region
 Why Need of Industrialization Initiatives? ( Rural ,
Cottage )
3/7/2023 2
 The Terminologies
The word Industry means Production, it refers to
people, companies and activities involved in one
type of business that produces goods or offer
services
• Electricity Industry
• Tourism Industry
• Entertainment Industry(film, music…)
• The Manufacturing Industry
• Computer Industry ……. Etc
3/7/2023 3
 Cont’d…
• Manufacturing : It is the Processing Of Raw
Materials in to Finished Goods (Products) Using
Human Labor (Man), Machine (Tool), Method
(Process) – 4M’s
• Therefore Manufacturing Industry Refers To
Companies Or People Involving In Production Of
Goods(products) for sale in a Factory or special
Area.
• But the Word Industry or Manufacturing is
commonly used interchangeably for
Manufacturing Industry
3/7/2023 4
 Cont’d…
• Factory means buildings or group of buildings
where Goods are Manufactured or Assembled
(It is the Hardware of Manufacturing
Industry)

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 Introduction to Manufacturing Industry and
Industrialization
• The economic transformation of any nation in
the world depends on the level and quality of
manufacturing development
• Manufacturing sector is the driving force for
structural change, poverty reduction, lower
unemployment and economic growth
• Today developing countries used
manufacturing sector for economic
transformation and developed courtiers use
manufacturing sector for resilience economy
3/7/2023 6
 Cont’d…

• African countries including Ethiopia /

Oromia missed the opportunity of economic
transformation due to poor development of
manufacturing sectors
• So this presentation tries to make awareness
on Industrialization and Development of
Rural and Cottage Industries in our region

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 Evolution of Manufacturing Industry (Industrial
Revolutions)
Industrial Revolution
 The process of change from an Agrarian and handicraft
economy to one dominated by Industry and machine
manufacturing
 The Industrial Revolution was the transition from small
cottage industries in which goods were primarily made by
hand to new mass-produced goods in factories using steam
and water power
• Features of industrial revolution are:
- Technological
- Socio-economic
- Cultural ………..transformation
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 First Industrial Revolution ( Industry 1.0):
The First Industrial Era period started in the 18th
century In England (Britain) with the introduction
of water power and energy of the output
The industrial period in Britain came about to the
end of the 18th century (1760-1840) to introduce
machinery into existence
Production mechanized for the first time
It involved moving from manual engineering to use
turbine engines and water as power source

3/7/2023 9
 Cont’d…
Textiles were the dominant industry of the
early Industrial Revolution.
This was in 1784 that the first weaving loom
was built
 It resulted in increasing production volume,
efficiency, entrepreneurship culture, better
employment, people became increasingly
urbanized

3/7/2023 10
Second Industrial Revolution (Industry 2.0) :

 In the 19th century (1863-1947) the second Industrial

Revolution began in countries like Britain, Europe,
North America, Japan with the invention of the
production of electricity and assembly lines
 The invention of electrical energy devices was the
primary contributor to this revolution
 Efficiency, mass production was increased, heavy steel
production contributed to the integration of Rail roads
into the economy

3/7/2023 11
Third Industrial Revolution ( Industry 3.0):
• From 1950- 1970s the Third Industrial Revolution began in
with partial automation using memory-programmable
controls and computers (Digital Revolution and Transition
from Analog and Mechanical systems to Digital systems )

• Since then the systems are Robotic and Automatic and have
developed continuously with the developments in the
electronics and IT industry

• Following the introduction of these developments, we are

now in a position to optimize the entire development
process-without human assistance
3/7/2023 12
 Cont’d…
• Examples of this are robots running program
sequences without human interference
• It originated from substantial R&D spending by the
government and universities, first made for security
reasons, and then produced for commercial purposes
• Advanced Manufacturing Technology (AMT),
Computer-Based Integrated Manufacturing(CIM),
Computer Aided Design(CAD),Computer Aided
Manufacturing(CAM) …..
 It brings shorter manufacturing time, quick response
to customer demand , improved process management
and accuracy, more Versatility(ability to do various
tasks)

3/7/2023 13
 Fourth Industrial Revolution ( Industry 4.0):
• It is first introduced by Germany by group
of scientists , first invented in 2016
• Currently, the Fourth Industrial Revolution
is in progress
• The next phase in digitalization of the
manufacturing sector
• It is designed to transform conventional
machine-based to digital and Artificial
Intelligence-based
3/7/2023 14
 Cont’d…
• system can coordinate and communicate based
on the situation (sensors) and it does not require
any human interaction in controlling and
directing the production process
• Computer technology manufacturing processes
are extended through a network connection and
thus have a physical counterpart on the Internet
• Networking of all systems leads to "cyber-
physical manufacturing systems(intelligent
system)" and thus to clever factories that use a
network to connect production systems,
products and people

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• First IR – Manufacturing 1.0- steam propelled
• Second IR – Manufacturing 2.0-electricity
powered
• Third IR- Manufacturing 3.0-preliminary
automation
• Fourth IR – Manufacturing 4.0 - Cyber
physical systems , Intelligent computers ,AI

3/7/2023 16
 The Roles(Benefits) of Industrialization
• It provides large opportunity to accumulate capital
and capability
• Inputs for Agriculture and Service
• Acquire new Technologies
• Creates Employment opportunity
• It increases knowledge and productivity through
training on the job mechanisms
• It generates substantial backward and forward
linkages with other sectors (Input , Product,
technology,…)

3/7/2023 17
 Cont’d…
• It generates demand for agriculture,
mining, and other raw materials, as well as
for energy and information technologies ,
service centers (Backward Linkage)
• It increases the supply of products for
consumer markets( Forward Linkage)
Moreover, in macroeconomic terms, it
improves a country’s external account
balance by decreasing imports and
diversifying exports
3/7/2023 18
 Provide
inputs for Employment
Capital and agri. And opportunity
capability serv.
accumulation

Create modern Provides

economy various types of
through Roles of goods
innovation manufacturing

Increase
Improve the production and
international productivity
trade Facilitate
Encourage structural
forward and transformati
backward on
linkage

3/7/2023 19
 Tools to Implement Industrial Development
• Proclamations, Policies Inputs, Programs
• Strategies/ Industry Road Map for 15 yrs/
• Working documents, directives, manuals
• Development plans, Operational plans
• Check-lists …… etc

3/7/2023 20
 What is Our Role Industrial Development
• Development of the strategic Industries in our region
( Textile and Garment, Leather and Leather goods, Agro
processing, Chemical and Construction Inputs, Metal
and Engineering, Wood and Bamboo)
• Supporting and follow up ( Technical trainings, Forward
and Backward linkage, technology, quality standard,
Infra structure, machine, finance , incentives )
• The support is given multi-sectors but the facilitation
and coordination role is ours ( Forum, MOU’s, Letters..)
 There are several stake holders of Industry
development:- Banks, EIIDA, Unions , EEU, TVET’s,
Institutes, Science and Technology, Capital Goods
Financing institutions,…..
3/7/2023 21
 Key Performance Indicators
• Increasing Employment ( Carraa hojii)
• GDP contribution (Galii)
• Export (Al-Ergee)
• Domestic production
• ( Import Substitution)
 Macro Economic Transformation

3/7/2023 22
Recent Manufacturing Industry Trends In Our
Region
• During the last two decades before the reform the
regional manufacturing industries were small in number
and stagnant
• It was not established in the way that create the regional
accumulate capability
• In 2010 the total number of licensed manufacturing
investment was 3624 but in 2013 the total number
reached 7694
• Within three years the sector grow more than 100 percent
 Including the recent Board decision the number
increased to 8007

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 The trends of licensed Number of manufacturing
sectores in Oromia
Number of manufacturing sectores

7694 8007

3684

2010 2013 2014

3/7/2023 24
 The town level share of manufacturing sector in
Oromia
Industirii share 17.8

15.18
13.4 13 13.3

7.6

3.8
2.5 2.3 2.7
1.8 2.1
1.16 1.4
0.46 0.12 0.2 0.3

-0.3

3/7/2023 25
 Zonal share of manufactring sector
in Oromia
26.6 share

15.44

8.4 9.4 8.6

6.3
4.1 3.4
1.4 0.11 0.86 1.7 2.15 1.1 2.07 1 1.5

-0.5

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 Why Need of Industrialization Initiatives?
( Rural Industrialization , Cottage Industry )
• It is an Intervention to fill the gaps of
Industrialization in our region
• It emanates from problems

3/7/2023 27
 So what are the problems (gaps)?
 Rapid growth of Industrialization,
Urbanization and Globalization
 Slow development of Industry in our region
 Centralized Industry distribution
 Huge gap between Demand and Supply
 Lack of up to date technologies – back warded
cottage Industries
 Increasing rate of unemployment
 Poor entrepreneurship culture ……etc
3/7/2023 28
• Pyramidal scaling up of Industries

Large Industries

Medium Industries

Small Industries

Cottage Industries

3/7/2023 29
 Cont’d…

• Therefore by applying Rural Industrialization

and Cottage Industries Development and Put a
wide base for large Industries we can put
significant result to the transformation of The
Economy!!

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