Economic and political reforms have been introduced in Ethiopia and these have boosted private investment over the last two decades. Reforms have brought about measurable improvements, but the progress of the status of private investment has remained slow. This study was conducted with the objective of investigating the microeconomic level determinants of private investment in the manufacturing sector. These micro-level determinants of private investment in the State of Tigray, Ethiopia, were analysed using both descriptive and econometric methods. Thus, an econometric method of data analysis using a duration model was applied to analyse the microeconomic data collected. In addition, descriptive analysis was employed to analyse the survey data. Here, a chi-square test and factor analysis were used to analyse the relationship between variables and their constraints on the operations of the manufacturing sector. The major microeconomic determinants of private investment status in the State of Tigray were found to be investment areas, access to credit, infrastructure facilities, the judicial system, corruption, investment incentives and bureaucratic red tape. The econometric result revealed that infrastructure facilities, the judicial system, and investment areas negatively and significantly delayed the entire private investment status. However, interest rates and investment location were positively and significantly supported to continue their status of the entire private investors in the manufacturing sector. Infrastructure facilities, investment incentives, and investment areas were negatively and significantly related to the started group of investors’ progress. However, investment location was related positively and significantly to the started group and the ability of the implementation and operation statuses of private investors to proceed to operation status. In the case of the non-started group, infrastructure facilities and investment areas are related significantly and negatively to investment status delay. By contrast, interest rates and investment location significantly and positively affect private investment status delay. According to the descriptive analysis, access to credit, bureaucratic red tape and corruption were the additional major factors that hinder private investment from progressing from one xii status to the next. The investor’s level of education, access to land and political instability risks in the survey were not determinants of private investment status. In addition, the survey of private investors for those who have already started production shows that infrastructural, technological, and economic and financial factors have the highest absolute value of the loading factors that hinders operations in the manufacturing sector. The results of this study revealed that most of the problems encountered in the manufacturing sector were institutional but some were related to the private investors themselves. Thus, the government should take measures to establish a true, independent and efficient institution so as to create access to credit and provide infrastructure facilities to the private sector. This could be done by minimising corruption and ensuring transparent investment regulations. Thus, the State of Tigray, Ethiopia, must attract and encourage private investors by applying and improving policies which promote private investment. In this way they will actively contribute to the overall development and growth of the Ethiopian economy. Finally, as this study is made on the causes of delay in each phases of investment, it contributes a new knowledge to all investment sectors in the developing countries as whole and particularly to all regions of Ethiopia for advanced polices and strategies development on investment decisions. Then, based on the results of the study and solving these identified problems of investment phases, all actors of investment can retain and encourage the existing and attract new private investors to enhance the economic development of the society. The findings from this study have important implications for prospective business owners, lenders, and policy makers on how to improve private investment and create conducive business environment. / Business Management / D.B.L.

Thesis (MPhil)--Stellenbosch University, 2015. / ENGLISH ABSTRACT: The Tigray region in northern Ethiopia is a historic centre of agricultural production and home to many subsistence farmers that still use traditional farming systems and practise rain-fed agriculture. The region has been affected adversely by famines and periodic droughts for centuries and is vulnerable to climate change. Farmers are producing on small plots of often degraded land and through their own actions have depleted the natural resources they rely on, in particular soil, water and trees. This study sought to explore the environmental degradation of Tigray through both a literature review of its agricultural socio-political history and a lived experience in the village of Abraha We Atsebaha among farmers of the region. It uses a variety of methodologies and methods, including a literature review, grounded theory, narrative inquiry and ethnography, to expand on the factors that have contributed to the current degradation, the implications for traditional farming and the potential for land regeneration. The first journal article seeks to explore how Ethiopians have shaped their natural environment. In particular, it focuses on deforestation, soil degradation, the role of changing governance and land-ownership patterns, and the effects of climate change. The article demonstrates that traditional farming systems do not operate in isolation from their socio-political and environmental context. The second journal article provides an in-depth narrative inquiry conducted in Abraha We Atsebaha over a three-month period in 2014. This village is known for its indigenous farming knowledge, commitment to regeneration and innovation in conservation practices. Interviews were conducted with selected farmers and local leaders and informal discussions were carried out with government extension representatives using the ethno-ecological cosmos-corpus-praxis guidelines to enable an integrated exploration of the nature of traditional farming, the causative factors of environmental deterioration and the resultant communal response. In addition to written interview notes, observations and field notes were recorded daily. Photographs are used to give a real sense of the community and their work. It emerged during this process that underlying belief systems were exceptionally important in a context of traditional conservation. Both articles discuss the development work undertaken by government in the rural farming sector and the successes and challenges faced. They also show that elements of traditional farming, sustainability measures and environmental care were suspended in favour of short-term survival as a consequence of social, political and population stressors. This study provides learning points, gained from insights gleaned from the literature review and the lived experience, for improving development interventions in this region. This study did not explicitly explore the role of religion in conservation or the potential long-term effects of current government policies and initiatives. However, it contributes to the small pool of literature on the region focused on traditional farming systems by providing a comprehensive overview of the drivers of degradation (historical and current) and offers a unique, “soft” experiential narration of a village in northern Ethiopia that allows insight into farmer experiences, pressures and adaptation efforts. / AFRIKAANSE OPSOMMING: Die Tigray-streek in die noorde van Ethiopië is ’n historiese sentrum van landbouproduksie en die tuiste van menige bestaansboer wat nog op tradisionele boerderystelsels en reënbesproeiing staatmaak. Die streek het eeue lank onder hongersnood en periodieke droogtes gebuk gegaan en is kwesbaar vir klimaatsverandering. Boere bewerk klein stukke, dikwels afgetakelde, grond en het deur hul eie optrede die natuurlike hulpbronne waarop hulle staatmaak – veral die grond, water en bome – uitgeput. Hierdie studie was daarop toegespits om ’n beter begrip te vorm van die omgewingsaftakeling in Tigray. Vir hierdie doel is ’n literatuurstudie van die sosiopolitieke landbougeskiedenis van die gebied onderneem, en is die lewe in die dorp Abraha We Atsebaha tussen boere van die streek ervaar. Die navorsing het van ’n verskeidenheid metodologieë en metodes, waaronder ’n literatuuroorsig, gegronde teorie, narratiewe ondersoek en etnografie, gebruik gemaak om lig te werp op die faktore wat tot die huidige aftakeling bygedra het, die implikasies vir tradisionele boerdery, en die potensiaal vir grondvernuwing. Die eerste tydskrifartikel verken hoe Ethiopiërs hul natuurlike omgewing gevorm het. Dit konsentreer veral op ontbossing, grondaftakeling, die rol van veranderende staatsbestuurs- en grondbesitpatrone, en die uitwerking van klimaatsverandering. Die artikel toon dat tradisionele boerderystelsels nie afsonderlik van hul sosiopolitieke en omgewingskonteks funksioneer nie. Die tweede tydskrifartikel beskryf ’n narratiewe diepte-ondersoek wat oor ’n drie maande lange tydperk in 2014 in Abraha We Atsebaha onderneem is. Hierdie dorp is bekend vir sy inheemse landboukennis, toewyding aan vernuwing, en innoverende bewaringspraktyke. Onderhoude is met ’n uitgesoekte groep boere en plaaslike leiers gevoer, en voorligtingsbeamptes van die staat is by informele gesprekke betrek. Die etno-ekologiese cosmos-corpus-praxis-riglyne is gebruik om ’n geïntegreerde studie te onderneem van die aard van tradisionele boerdery, die oorsaaklike faktore van omgewingsaftakeling, en die gevolglike gemeenskapsreaksie. Benewens skriftelike aantekeninge gedurende die onderhoude, is waarnemings en veldnotas ook daagliks opgeteken. Foto’s word gebruik om die gemeenskap en hul werk getrou uit te beeld. Gedurende hierdie proses het aan die lig gekom dat onderliggende oortuigingstelsels besonder belangrik is in ’n tradisionele bewaringskonteks. Albei artikels bespreek die ontwikkelingswerk wat die regering in die landelike boerderysektor onderneem, sowel as die suksesse en uitdagings daarvan. Dit toon ook dat elemente van tradisionele boerdery, volhoubaarheidsmaatreëls en omgewingsorg as gevolg van maatskaplike, politieke en bevolkingsfaktore laat vaar is ten gunste van korttermynoorlewing. Die insigte wat uit die literatuuroorsig sowel as die lewenservaring in die bestudeerde gemeenskap spruit, bied lesse vir die verbetering van ontwikkelingsintervensies in die streek. Die studie het nie uitdruklik die rol van godsdiens in bewaring of die potensiële langtermynuitwerking van huidige staatsbeleide en -inisiatiewe ondersoek nie. Tog dra dit by tot die klein hoeveelheid beskikbare literatuur oor tradisionele boerderystelsels in die streek deur ’n omvattende oorsig te bied van die (historiese en huidige) snellers van aftakeling, en vertel dit ’n unieke, ‘sagte’ ervaringsverhaal oor ’n dorp in die noorde van Ethiopië om sodoende insig in landbou-ervarings, -druk en -aanpassingspogings te bied.