Ethiopian Standard Industrial Classification (ESIC)

1 Ethiopian Standard Industrial Classification (ESIC) (First Publication-January 2010) The Standard Code Tech ESIC Codes Adj Englis2 C O N T E N T S Topic Page Introduction (I) Business Licensing Categories (II) Coding of Business Licensing Categories (III) Acronyms & Abbreviations (V) Major Divisions for The Ethiopian Business Licensing Categories (VI) Agriculture, Hunting, Forestry and Fishing 1 Mining and quarrying 2 Manufacturing 6 Electricity, Gas and Water Supply 19 Construction 20 Wholesale and Retail Trade, Repair of Motor Vehicles, Motor Cycles and Personal and Household Goods; Hotels and Restaurants.

2 Import and Export 21 Transport, Storage and Communication 53 Financial Intermediation, Insurance, Real Estate and Business Services 56 Community, Social and Personal Services 61 Private Household Exterritorial, Non-governmental Organizations, Representatives of Foreign Governments and Other Activities not Adequately Defined 66 The Standard Code Tech ESIC Codes Adj Englis2 Introduction This document has been prepared to serve as a guide for the implementation of the redesigned business process, "Trade Practice and Consumer Affairs", one of the core processes which have been identified for Business Process Re-engineering (BPR) in order to make a holistic business reform in the Ethiopian trade system.

3 The document is intended to serve as an instrument to facilitate a systematic licensing and proper functioning of trade in the country. This core process plays a significant role for the Ministry of Trade to achieve its regulatory objective while also contributing to the endvours of other Ministries and Agencies to do the same. The following are major areas of activities involved in the business process which have been streamlined and organized accordingly based on their natural connection.

4 Requirement setting, Assurance of competence, Business registration and licensing, Inspection and regulation enforcement. The use of established requirements/ standards would lay the ground for an optimum level of information availability and Standard -based trade interaction, hence providing the means for traceability and accountability in the market system. Thus, through implementation of the new process the needs of the various business actors, the public and the government will be in a fair balance, and as a result it would be expected that the process will definitely contribute significantly to the county's socio-economic progress.

5 The main process desired outcome is achieving the best performance that would ultimately lead to effectiveness, stability and fair trade practice, which is legitimate and in line with the national development policy objectives. Business licensing based on specified requirements is a primary concern and has to be done properly in order to guarantee for proper functioning of the trade system. (I) The Standard Code Tech ESIC Codes Adj Englis2 When technical specifications/ standards are referred to as technical regulation they cover two equally important aspects:- Administrative Procedure:- specify what preconditions suppliers and authorities must fulfill for a good business practice (eg.)

6 Testing, certification, licensing, inspections, approvals, sanctions). Such procedures are designed to ensure that the desired outcome is achieved, and consistency is maintained for a given business process. Product Characteristics:- specify the characteristics that products or processes have to comply with. Such requirements are also referred to as technical specifications or standards , and they are used by competent professionals for the judgment of compliance. In general, requirements are needed not only for pre-license conformity assessment for assurance of competence but also for post-license inspection, regulation enforcement and judgment for the appropriateness of sanction measures.

7 Business Licensing Categories In order to effectively implement the redesigned business process the requirements for trade licensing shall be prepared based on the Ethiopian Standard Industrial Classification , (ESIC) as adapted from the International Standard Industrial Classification (ISIC). The ISIC recognizes Classification of all economic activities into major sectors and breakdown of the details have been worked. The Classification is used for licensing, tax collection and others, though its primary objective was for statistical purpose.

8 To-date, there are 108 countries that have implemented the system. Each country, depending on its economy and available resources of its particular interest has adapted and made use of the system. (II) The Standard Code Tech ESIC Codes Adj Englis2 In the study conducted the practices of USA, Singapore, South Africa and Britain have been considered for benchmarking. However, the experiences gained from South Africa and Singapore were found more suitable to fit with the Ethiopian condition, hence the benchmarking is based on the adapted systems of the two countries in developing this document.

9 In Ethiopia, until now, trade registration and licensing are too generic and it has been found out that there is no systematic means for managing traceability and possibility to control trade malpractices is at a low level. However, the use of this systematic Classification is believed to solve most of the problems associated with information, traceability, accountability and coordination and regulation enforcement. And, this would underpin the fairness of trade practice and alleviate the degree of harm to the society and the national economy.

10 The Classification is made to cover all economic and social sectors activities while grouping together similar fields, products and services. The term 'industry' covers sectoral activities of all kinds, for instance, it includes those activities in the fields of agriculture, fishery, mining, manufacturing, health, education, transport, finance, etc. Coding of Business Licensing Categories Based on the Ethiopian particular condition the system has recognized 10 sectors for the Classification .