Factors that affect the level of private investment: in case of jimma zone

Abstract

Ethiopia has great potential for private investment sector because of its favorable conditions. Its fertile land, minerals, forest resources, different climatic conditions, water resources and human resources are some of the factors that makes Ethiopia desirable for private investment, despite these resources there are very few private investment activities in the country taking Jimma zone as one part of oromia region there are poor private investment activities even though the same favorable conditions exit as the general country. The study intended to identify the major causes for low private investment in Jimma zone of Oromia region, and there consequences on the overall economic development of the zone. For this purpose, data was collected from primary and secondary sources. Primary data was obtained from investment office of Jimma zone officers and leaders, and people being engaged in different private investment in the zone. Secondary data was taken from investment office of the zone, and different publications. The research also underlined the private investment activity is very limited and there are different social and economic problems resulted due to limited level of private investment such as, poor standardized of living, high unemployment, and general economic stagnation of the zone. Finally, the study concluded that the low level of private investment activities has negatively affected the level of economic growth of the zone.