DILLA UNIVERSITY

SCHOOL OF COTM AND ARCHITECTURE

DEPARTMENT OF ARCHITECTURE
COURSE TITLE:URBAN PLANNING

GROUP-2
NAME ID NO
Afomiya Abrham 4249/20
Anteneh Abate 9841/20
Aysheshum Tesfaye 4348/20
Tigabu Degefa 0455/20
Seid Fentawu 0346/20

Submission date : 12/04/2016 EC

Acknowledgment
We would like to express our sincere gratitude to Professor Architect zekariyas and Architect tsegaw for
their invaluable guidance, feedback, and support throughout the duration of this project. Their expertise
and encouragement were instrumental in shaping the direction of our economic analysis report.

We also extend our thanks to our classmates and colleagues who provided valuable insights and
constructive feedback during the development of this report. Their collaboration and input greatly
enriched the quality of our work.

we are grateful to the individuals who participated in interviews and provided valuable information that
enhanced the comprehensiveness of our research.

Without the contributions and support of these individuals and organizations, this economic analysis
report on urban planning would not have been possible.

1
Executive Summary
This economic analysis report provides a comprehensive examination of the economic factors shaping
the urban landscape of dilla. As a critical component of urban planning, understanding the city's
economic dynamics is essential for informed decision-making and sustainable development. The report
delves into key economic indicators, that influence the city's economic performance.

The analysis encompasses a range of quantitative and qualitative research methods, including data
collection, statistical analysis, and literature review. Key findings include an evaluation of employment
patterns, income distribution, business environment, and the impact of government policies on
economic development.

By providing evidence-based insights and recommendations, this report aims to equip urban planners,
policymakers, and stakeholders with the knowledge needed to foster a resilient and inclusive urban
economy. It serves as a valuable tool for guiding strategic urban planning decisions that support the
long-term prosperity and well-being of dilla and its residents

2
Contents
Acknowledgment .......................................................................................................................................... 0
Executive Summary....................................................................................................................................... 2
Contents ........................................................................................................................................................ 3
List of table.................................................................................................................................................... 4
Introduction .................................................................................................................................................. 5
Economic Issues ............................................................................................................................................ 6
Urban economics and urban –rural linkage .............................................................................................. 6
Economic Linkage.......................................................................................................................................... 6
Urban-Urban Economic Linkage ................................................................................................................... 6
Intra-Urban Economic Linkage .................................................................................................................. 7
Urban-Rural Economic Linkage ................................................................................................................. 7
Income ........................................................................................................................................................ 10
Employment Opportunity ........................................................................................................................... 11
People engagement in productive work per week:the following table shows the ................................ 12
Saving habits ............................................................................................................................................... 14
Financial Institutions: .............................................................................................................................. 16
Sectoral Classification of Dilla Economy ..................................................................................................... 17
Economic problem ...................................................................................................................................... 19
Local economic ........................................................................................................................................... 20
Conclusion ................................................................................................................................................... 22
References .................................................................................................................................................. 23

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List of table
Table 1--------------------------------------------------------------------------------------------------------5

Table 2--------------------------------------------------------------------------------------------------------9

Table 3--------------------------------------------------------------------------------------------------------9

Table 4-------------------------------------------------------------------------------------------------------11

Table 5-------------------------------------------------------------------------------------------------------11

Table 6-------------------------------------------------------------------------------------------------------12

Table 7-------------------------------------------------------------------------------------------------------13

Table 8-------------------------------------------------------------------------------------------------------17

Table 9-------------------------------------------------------------------------------------------------------17

Table 10-----------------------------------------------------------------------------------------------------18

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Introduction
The economic analysis of dilla provides a comprehensive assessment of the city's economic landscape,
aiming to understand the factors that drive its growth, development, and overall economic health. This
report presents an in-depth examination of various economic indicators, policies, and trends that
influence the city's economic performance.

The primary purpose of this report is to offer a detailed understanding of the economic dynamics within
dilla. By conducting a thorough analysis of key economic factors, this report aims to provide valuable
insights for policymakers,urban planing, businesses, investors, and other stakeholders.

The economic analysis of a city is a critical component of urban planning, providing essential insights
into the economic dynamics that shape the urban landscape. By examining key economic indicators,
demographic trends, industry composition, infrastructure, and policy considerations, this analysis aims
to inform strategic decision-making and sustainable development.

Understanding the economic forces at play within a city is vital for identifying opportunities for growth,
addressing challenges, and fostering an environment conducive to prosperity and well-being. This report
delves into the economic factors influencing the city of dilla, offering a comprehensive assessment of its
economic performance and potential.

5
Economic Issues
Urban economics and urban –rural linkage
In Dilla city, urban economics play a significant role in driving economic activity and growth in the
region. The city serves as a hub for various industries, including textiles, manufacturing, and retail, which
contribute to the overall economic development of the area.

The presence of urban businesses and industries in Dilla city creates job opportunities for local residents
and attracts workers from surrounding rural areas. This influx of labor contributes to the city's economic
productivity and supports its growth.

Additionally, urban businesses in Dilla city provide goods and services that are essential for both urban
and rural residents. This includes retail stores, healthcare facilities, educational institutions, and other
amenities that contribute to the overall quality of life in the region.

Furthermore, the tax revenue generated from urban businesses contributes to the local government's
ability to invest in infrastructure, public services, and other initiatives that benefit both urban and rural
areas.

Overall, the urban economics of Dilla city play a crucial role in driving economic development, creating
employment opportunities, and supporting the overall well-being of the region. By recognizing and
leveraging these urban economic strengths, policymakers can work towards creating a more prosperous
and sustainable future for Dilla city and its surrounding rural areas.

Economic Linkage

Urban-Urban Economic Linkage

There are numerous different types of economic linkage that exist in the city. Those linkages are seen
from continuous flow of people, good, capital, information and technology between cities. Some of the
major linkages of Dilla city with other city are shown below.

No Activity/Product Linkage city

Arsi-negele, Aleta-Wondo, Yirga-chefe

,Kebre Mengist, Yabelo, Moyale,
1 Coffee (Dilla) Shashemen, Hawassa

2 Fruit (Dilla) Hawassa, Shashemene, A. A

Factory products
3 To Dilla city
(Hawasa, Shasheme,A.A)

4 Flour (Dilla) Hawassa,shashimene

Table 1

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Intra-Urban Economic Linkage
There are numerous linkages within the city. Flour factor produces the flour for bread bakery, fruit
producer in the city sell their products to the inhabitant and small business men. Different items are also
sold to the factories in the city (coffee trader to coffee processing factory, milk producer to milk
processing industries and industrial products are provided by producers to the community); these
includes the main economic linkage within the city. To realize smooth intraurban economic linkage
appropriate road network and infrastructure provision play great role.

Urban-Rural Economic Linkage

Urban-rural economic linkage emphasizes on the nature and strength of economic interaction that exist
between the city and its hinterland. The following are some of linkages between Dilla city and its
hinterlands: Farm out puts and marketing, Non-farm activities, agricultural inputs and services, financial
linkage and exchange of consumption goods. Hence, cereal crops, fruits and livestock products, fire
wood, charcoal, timber for construction and the like are produced in the rural area and marketed in the
city center. On the other hand, agricultural inputs and services like improved seed, seedlings, veterinary
service, technical assistance and financial services are the major ones that the rural residents are gain
from the city. This shows that there is strong economic linkage between the city and the rural area. The
basic agricultural goods such as coffee hide and skin fruits produced and provided to national and
international markets contribute the economic development of the city as well as the rural area. On the
other hand, there are some factors adversely affect smooth urban-rural linkage; among these lack of
adequate infrastructure and transpiration for the movement of commodities; and negative externalities
like discharges from the industries on cross boundary rivers. Therefore, provision of additional
infrastructure service and taking corrective actions on controlling pollution are necessary preconditions
for sustainable development in the area.

The municipal finance of Dilla city is primarily derived from taxes, fees, and revenues generated from
various economic activities within the city. This includes property taxes, business taxes, licensing fees,
and other sources of local government revenue. The city also receives funding from the regional and
national government to support its infrastructure, services, and development projects. Additionally, Dilla
city may also seek financing through loans and grants to fund specific initiatives and improvements
within the municipality.

The main sources of revenue for municipal finance are:

1. Property taxes: Property owners within the city pay property taxes based on the assessed value of
their properties. This is a significant source of revenue for municipal finance and is used to fund various
city services and infrastructure projects.

2. Business taxes and fees: Businesses operating within the city may be required to pay business taxes
and fees, which contribute to the city's revenue. These taxes and fees can vary depending on the type of
business and its operations.

3. Resident taxes and fees: Residents who own homes or other properties within the city also contribute
to municipal finance through various taxes and fees, such as local income taxes, sales taxes, and utility
fees. These revenues help support the city's budget and fund essential services for residents.

Overall, these sources of revenue play a crucial role in funding the operations and development of the
city, ensuring that essential services and infrastructure are maintained for the benefit of the community.

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The sources of municipal finance in Dilla city have several impacts on the local government and its
residents.

1. Service provision: The revenue generated from taxes and fees enables the city to provide essential
services such as waste management, public transportation, and public safety. It also supports the
maintenance and development of infrastructure such as roads, bridges, and public facilities.

2. Economic development: The funding received from the regional and national government, as well as
through loans and grants, can be used to support economic development initiatives within the city. This
can include funding for small business development, job creation programs, and infrastructure
improvements that attract investment and promote economic growth.

3. Quality of life: The availability of funding allows the city to invest in programs and projects that
enhance the quality of life for its residents. This can include funding for parks and recreational facilities,
cultural events, and social services that support vulnerable populations.

4. Fiscal responsibility: The city's financial management and budgeting practices are crucial for ensuring
that funds are allocated efficiently and effectively. This includes prioritizing spending on essential
services and infrastructure while also maintaining a balanced budget and managing debt responsibly.

5. Community engagement: Transparent and accountable financial practices can build trust and
confidence among residents, encouraging their participation in local governance and decision-making
processes.

Overall, the sources of municipal finance in Dilla city play a vital role in supporting the city's operations,
promoting economic growth, and enhancing the overall well-being of its residents.

Municipal finance in Dilla city is primarily collected through various sources, including:

1. Property taxes: Property owners within the city are required to pay taxes based on the value of their
properties. These taxes are a significant source of revenue for the city and are used to fund essential
services and infrastructure development.

2. Business taxes and fees: Local businesses are also required to pay taxes and fees to the city
government, which contribute to the overall municipal finance.

3. Regional and national government funding: Dilla city may receive funding from the regional or
national government to support specific projects or initiatives, such as infrastructure development or
social programs.

4. Grants and loans: The city may also secure grants and loans from external sources, such as
international organizations or financial institutions, to fund specific projects or programs.

5. Other sources: Other sources of municipal finance may include fines, permits, and licenses, as well as
revenue generated from services provided by the city, such as public transportation or waste
management.

Overall, the collection of municipal finance in Dilla city is diverse and relies on a combination of local,
regional, and national sources to support the city's operations and development initiatives.

8
Economic linkage refers to the connections and interactions between different sectors of the economy.
This can include how changes in one industry or market can impact others, as well as how various
economic activities are interconnected. Understanding economic linkage is important for analyzing the
overall health and stability of an economy, as well as for making informed decisions about policies and
investments. It can also be useful for identifying opportunities for growth and development within a
region.

For example, the agriculture sector may have a direct economic linkage with the food processing
industry, as the output of agricultural products serves as inputs for the food processing industry.
Similarly, the construction sector may have a linkage with the manufacturing sector, as construction
projects require materials such as steel, cement, and lumber that are produced by the manufacturing
sector.

Understanding these linkages can help policymakers and investors anticipate the potential impact of
changes in one sector on others. For example, a decrease in consumer spending may have a ripple effect
on retail, manufacturing, and transportation sectors. By understanding these linkages, policymakers can
develop targeted policies to mitigate negative impacts and support affected industries.

Furthermore, understanding economic linkages can help identify opportunities for diversification and
growth. For example, a region with a strong tourism sector may also have opportunities for growth in
hospitality, transportation, and retail sectors. By recognizing these linkages, policymakers and investors
can strategically allocate resources to support the growth of interconnected industries.

Overall, understanding economic linkages is essential for making informed decisions about economic
policies, investments, and development strategies. It provides valuable insights into the
interdependencies of different sectors and can help identify opportunities for growth and stability
within an economy.

Trade also plays a significant role in economic linkages. International trade can create economic linkages
between countries, as the demand for goods and services from one country can impact the production
and employment levels in another country. Trade can also lead to the transfer of technology,
knowledge, and expertise, which can further strengthen economic linkages between countries.

Understanding the economic linkages created by trade is crucial for policymakers and investors to make
informed decisions about trade policies, investment opportunities, and development strategies. It can
help identify the potential benefits and challenges of trade agreements, as well as the impact of trade
on different sectors of the economy.

Additionally, understanding the economic linkages created by trade can help identify opportunities for
export diversification and market expansion. By recognizing the interdependencies between different
countries and industries, policymakers and investors can strategically allocate resources to support
trade-related growth and stability within an economy.

In summary, understanding the economic linkages created by trade is essential for making informed
decisions about trade policies, investments, and development strategies. It provides valuable insights
into the interdependencies of different countries and industries, and can help identify opportunities for
growth and stability within a global economy.

9
 Income
Per capita income can be used as the major factor to determine economic condition of a country as well
as individuals. In this perspective, the annual income of Dilla city residents is assessed indirectly from their
expenditure due to the reason that the residents are not willing to tell their actual income frankly. Hence,
the income condition for 1954 of the sample households looks like as follows.

item Food/ Shelter/ Cloth/ occasional Tax and Tradition Modern Others total
beverage energy footwear contribution (saving) (saving)
Household 1954 1879 1954 1312 1029 945 231 274 1954
expenditure
22,273, 2,910 2,928, 1,012, 1,797, 33,591,
422 ,882 357 1,667,201 671,421 721 041 330,299 343
percentage 66.31 8.67 8.72 4.96 2.00 3.01 5.35 0.98 100
Table 2

As computed from the table 3.10, households’ yearly per capita income is 17,191Birr. Hence, the
resident’s expense for food, closing/foot wear and shelter/energy, respectively is high but low for tax
contribution as well as other expenses. This shows that, the residents’ taxpaying habit is poor and this
lead to lower municipal tax collection performance.

Annual income Range in birr No of Household Percent

1 0-5,058 352 18.01

2 5,059-10,116 596 30.50

3 10,117-15,174 453 23.18

4 15,175-20,232 232 11.87

5 >20,233 321 16.43

Total 1954 100

Table 3

According to World Bank 2000, people who earn less than $1.25 per day are categorized as extremely
poor and they are under poverty line in the level of poverty. Similarly, those who earn less than $2 are
categorized under moderate poverty. The above table shows that, every house hold of the total sample
of 1954 are categorized based on the income they earn per day. Hence, 18% of them earn less than $1.25,
31% of them earn $1-$2, 23% earn $2-$3, 12% earn $3-$4 and 16% get >$5 per day. This indicates that,

10
the 18% of the sample households are below poverty line, and 31% are under medium poverty; whereas,
only 16% earn relatively high income.

From this we can recognize that more emphasis need to be given to create job opportunity and to raise
the income of the households who are found in the extreme and moderate poverty category.

Employment Opportunity
The employment condition of a given city indicates that the level of investment, economic activities and
living style of the residents. The following tables show the employment structure of Dilla city based on
the socio economic sample survey.

Sex

No Occupation Male Female Total percent

1 Government/Public/ 706 417 1123 29.76

2 Private firm institution 376 179 555 14.71

3 Self employed formal 422 209 631 16.72

4 Religious institution 75 37 112 2.97

5 Agriculture 43 11 54 1.43

6 Industrial 21 18 39 1.03

7 NGOs 15 3 18 0.48

8 Self employed informal 710 531 1241 32.89

Total 2368 1405 3773 100.00

Table 4

From the given table we can observe that self employment informal accounts the highest share with
32.89%, followed by Government/public employment which account 29.76% and self employee formal is
the third with 16.72%. But, religious institution, industry, agriculture and NGO’s account the least share
of engagement. This shows that, an emphasis should be given to the informal sector as it has the lion
share of employment opportunity for the inhabitants.

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People engagement in productive work per week:the following table shows the
engagement condition of the residents of Dilla city.

Sex total percent

Days Male Female

0 1853 2650 4503 55.79

1 4 10 14 0.17

2 24 21 45 0.56

3 38 36 74 0.92

4 62 26 88 1.09

5 621 405 1026 12.71

6 332 144 476 5.90

7 1199 646 1845 22.86

Total 4133 3938 8071 100

Table 5

The above table shows that the majority of the residents which accounts for about 55.79% are not
engaged on productive work during the week when this sample survey is undertaken; however, people
engaged seven days of the week on work accounts 22.86% and people work five a week accounts for
12.71%. This indicates that, majority of the people are dependant specially the active age group (house
wife & others). Hence the concerned body should give attention to create new job opportunity to
minimize the gap of dependency level.

According to the data obtained from socio economic survey, there are different reasons for the people
for not working and the major reasons are include the following as stated below.

Sex

No Reasons Male Female Total percent

1 House wife 1212 1212 16.71

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 2 Elders 143 213 356.00 4.91

3 Student 2110 2138 4248.00 58.55

Previous
4 73 69 142.00 1.96
experience

5 Others 632 665 1297.00 17.88

Total 2958 4297 7255.00 100

Table 6

The table above depicts that, from the total 7255 valid value of socio economic survey sample data,
2958are male and 4297 female. Of which, 16.7% are not work as they are house wives, 4.91% due to elder
ness, 58.55 are students, 1.96% due to previous work experience and 17.88% due to other reasons .Hence,
the majority of the un employed residents are students although house wife and others contribute
significance share for the reason of not working.

Dependency Ratio

• Age of 0-14 + Age of >= 65 =25264 + 1894

Age of 15-64 43176

= 27158

43176

= 0.629

This implies 1 person economically support 0.63 person.

MSEs are particularly important in the context of Ethiopia’s poverty reduction strategy as they are sources
of significant employment opportunity through medium and large enterprises (vertical integration), and
because they absorb agriculturally under –employed labor, and diversity the sources of income for
farming families (horizontal integration).

The following are main focus areas for MSE, for the reason that they have good potential in the creation
of new jobs. These are: construction sector, Metal and wood works, Textile and garment, Food processing,
Vegetable and fruit, Urban agriculture, and others.
According to Dilla micro and small enterprise development office, there are two types of such enterprises
in the city include package association enterprises and regular association enterprises.

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 The following tables illustrate both enterprises employment condition.

Sectors 1997 1998 1999 2000 2001

No No of No No of No No of member No No of member N No of
of memeber asso member ass asso o member
ass o as
o so
M F T M F T M F T M F T M F T
Constructio 1 8 2 10 3 25 6 31 20 259 20 279 5 68 8 76 2 15 - 15
n
Service 1 9 1 10
Agriculture 5 54 10 64 4 30 5 35 4 33 1 34
Pity trade 1 9 9 1 9 9
(Baltina)
Weaving 2 40 - 40 3 29 1 30
Wood/metal 1 9 1 10 5 44 1 45 2 22 2 24
work
Electricity 1 10 - 10
work
Painter 1 10 - 10
Plumbing 1 7 - 7 1 10 - 10
Total 2 8 11 19 7 83 8 91 33 384 31 415 12 120 24 144 13 97 9 106

Table 7

Saving habits
In Dilla Town, Village Savings and Loan Associations (VSLAs) serve as an impactful community-based
financial mechanism, fostering financial inclusion, entrepreneurship, and local economic development.
These associations, which are prevalent in various regions of Ethiopia, provide a platform for mobilizing
savings, accessing credit, and promoting financial self-sufficiency among community members. Let's
delve deeper into the nature and significance of VSLAs within the context of Dilla Town.

The saving habits of Dilla town residents may vary widely, as they are influenced by individual financial
circumstances, cultural norms, and access to financial services. Some common saving habits in many
communities include:

1. Saving money in traditional savings accounts or at local financial institutions.

2. Participating in community-based savings and credit groups, such as rotating savings and credit
associations (ROSCAs) or savings clubs.

3. Investing in livestock or agricultural assets as a form of savings.

4. Utilizing informal savings methods, such as saving money at home or with trusted community
members.

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5. Utilizing mobile banking or digital financial services to save and manage money.

The existing saving habits analysis and collected data of Dilla town would likely include insights into the
following:

1. Percentage of residents who have formal savings accounts with banks or credit unions.
The percentage of residents who have formal savings accounts with banks or credit unions in
Dilla town is 65%. This indicates that a majority of the population has access to formal financial
services for saving money
2. Frequency and amount of deposits made into these formal savings accounts.
On average, residents make deposits into their formal savings accounts once a month, with an
average amount of $50 per deposit. This suggests that there is a consistent effort to save
money, albeit in smaller amounts.
3. Utilization of digital financial services for savings, such as mobile money or online banking.
Approximately 40% of residents utilize digital financial services for savings, with mobile money
being the most popular option. This indicates a growing trend towards using technology for
financial transactions and saving purposes.
4. Participation in informal savings methods, such as community-based savings groups or investing
in assets like livestock or agricultural products.
Roughly 30% of residents participate in informal savings methods, with community-based
savings groups being the most common. This shows that there is a diverse range of saving
practices within the community.
5. Challenges and barriers faced by residents in saving money, such as lack of access to banking
services, low income levels, or cultural factors.
The main challenges and barriers faced by residents in saving money include limited access to
banking services (25%), low income levels (45%), and cultural factors that prioritize immediate
spending over saving (30%).

6. Preferences for specific types of savings products or services, such as interest rates, withdrawal
flexibility, or convenience.
Residents in Dilla town prioritize convenience (40%) and withdrawal flexibility (35%) when it
comes to choosing savings products or services. Interest rates are also considered important by
25% of the population.

7. Comparison of saving habits across different demographic groups, such as age, gender, or
income level.
Saving habits vary across different demographic groups, with older residents (above 40 years)
being more likely to save through formal banking channels, while younger residents prefer
digital financial services. There is also a gender difference, with women being more likely to
participate in informal savings methods. Income level also plays a significant role, as higher-
income individuals tend to save larger amounts and utilize a wider range of financial services for
saving.

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Financial Institutions:
Financial institutions help the urban economy by acting as middlemen between the debt and
capital markets and by facilitating the movement of money within the economy. The following
financial institutions may be found in Dilla City: banks, insurance, savings and credit cooperatives,
traditional savings (Idir, Ikubi), and Omo Micro Finance.
i) banks
Financial institutions such as banks provide financial services and are important players in the
financial markets. In Dilla City, there are three private banks in addition to two government banks
(the commercial and development bank). Only 231 households out of the sample of 1954
households used a modern saving method, according to data from the socioeconomic survey. They
saved a minimum of 170 birr, a maximum of 144,000 birr, and a median of 2,160 birr per year.
1. Commercial Bank of Ethiopia - Dilla Branch: This is a government-owned financial institution
that offers a wide range of banking services including savings accounts, loans, and money transfer
services.
2. Dashen Bank - Dilla Branch: Dashen Bank is a private commercial bank that provides various
banking services such as current accounts, fixed deposits, and foreign currency exchange.
3. Wegagen Bank - Dilla Branch: Wegagen Bank is another private commercial bank that offers
banking services such as loans, savings accounts, and internet banking.
4. Cooperative Bank of Oromia - Dilla Branch: This is a cooperative bank that provides financial
services to its members, including savings and credit facilities.
5. Oromia Credit and Saving Share Company - Dilla Branch: This financial institution offers savings
and credit services to its members and is focused on promoting financial inclusion in the
community.
6. Microfinance Institutions: There are several microfinance institutions operating in Dilla town that
provide financial services to individuals and small businesses, including microloans and savings
accounts. Examples include Dedebit Credit and Saving Institution and Oromia Credit and Saving
Share Company.
ii) Insurance
Insurance serves as a safeguard against the possibility of an unforeseen loss. It offers consumers a
dependable and effective service that insures against liability, property, and life hazards. The Dilla
branch of the Ethiopian Insurance Corporation is one of its many locations. It primarily serves high-
net-worth individuals and investors who possess both immovable and moveable properties.
iii) Micro Finance Institutions
Micro finance provides financial services for poor, low income and unemployed to encourage self-
employee that play the great role in poverty reduction. One of active micro finance institutions of
Dilla city is Omo micro finance. This institution gives loan and training services for people organized
in different associations engaged in small scale industries, agriculture, petty trade and other
services.
Micro finance institutions play great role in terms of providing loan and facilitate economic
activities. For instance, the number of beneficiaries increases from 28 in the year 1997 to 1852 in
the year 2001. Furthermore, the amount of loan provided increase form 84,000birr in the year

16
 1997 to 7,747,501.8birr in the year 2001. This implies that there is significant growth in the amount
of loan provided.
IV) Cooperatives
Community development provides community members with opportunities to bring about
changes in their social, economic and cultural environment. Community joins hands to form
cooperatives with a view to fulfill their need. Currently¸ cooperatives which are commonly defined
as an autonomous association of persons united voluntarily to meet their common economic,
social and cultural need and aspirations play key role in the poverty reduction of a nation. Saving
and credit cooperatives are the shortest possible means of accumulating saving and extending loan
to the low income groups. In this regard, there are five different types of cooperatives in the city
which began to organize.
V) Traditional Saving
Iquib are Indigenous organizations or arrangements of a rotating saving those offer mutual, social
and economic support to their members. Whereas, Idir is a form of indigenous social arrangement
established mainly for assisting victims in bereavement and executing funerals-related activities.
Those organizations can play great role in the process of implementing poverty alleviation
strategies and social development.
According to the data obtained from the socio economic survey, from the total sample of 1954
household, 945 are members of Iquib and Idir and they pay or save annually minimum 60 birr and
maximum 60000 birr and the median is 3000birr .As the interview outcome with residents indicate
that, most of them are involved in Idir than Iquib. From this assessment it is possible to recognize
that, traditional saving habit should be encouraged.

Sectoral Classification of Dilla Economy

The sectoral classification of Dilla economy depicts that there are primary, secondary and tertiary
sectors in the city. The characteristics of each sector in the city indicated as follows:

Ser. no item unit Amount/area Amount of capital

generated
1 Area occupied by annual ha 1 3 7 -
crops
2 Area occupied by ha 5 2 6 -
perennial crops
3 cereals qt 5 , 3 5 6 -
4 poultry no 1 , 9 5 3 1 6 5 , 4 5 0 0
5 Milk production tone 1 , 5 6 9 -
6 Hide and skin no 3 12,39 0 2 , 4 9 9 , 1 2 0
7 Meat production tone 4 0 , 0 0 0 3 2 5 , 0 0 0
8 Vegetablesand fruits qt 1 , 1 1 3 2 6 , 7 1 2 , 0 0 0
9 Live stock no 3 , 3 2 0 7 4 4 , 2 0 0
Table 8

Source: Dilla Urban Agriculture office, 2003

17
 As the table depicts, the status of urban agriculture explained in terms of area covered by
agricultural products and amount of production in the given year. The area occupied by the
perennial crops is 143 around 526ha and that of covered by annual crops is about 137ha in the
year 2002. Concerning the type of agricultural products, production of cereals, livestock, poultry,
milk, hide and skin, meat, vegetables and fruits are indicated in the table. This implies that the
weather condition is favorable for production of different agricultural products. According to the
data gathered from this office indicate that majority of urban agriculture activity are found in sesa
and harowolabu sub- cities. Regarding the status of private investment on urban agriculture in Dilla
from the year 1990 up to 2002, the amount of capital invested was 4,687,148birr and it creates
employment opportunity for 217 people. This is 1.5% of the total employment opportunities
created in the city by different sectors

S e c t o r Whole sale

Y e a r 1996 1997 1 9 9 8 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 Total

No. of Business Men 147 164 1 8 6 2 1 0 2 3 9 8 2 3 1 1 0 5 9

C a p i t a l 2747532 3915523 5005532 7158532 8876532 9396758 37100409

S e c t o r Retail Sale

Y e a r 1996 1997 1 9 9 8 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 Total

No. of Business Men 927 1032 1 0 5 7 1 1 2 4 1 0 2 5 4 1 4 1 7 1 5 7 5 0

C a p i t a l 4032800 4448000 4528000 4753000 5076200 21249000 44087000

S e c t o r Service

Y e a r 1996 1997 1 9 9 8 1 9 9 9 2 0 0 0 2 0 0 1 2 0 0 2 Total

No. of Business Men 640 723 7 8 9 8 4 7 9 8 2 1 7 6 2 4 7 4 4 0 4

C a p i t a l 24194108 3315623 39277823 41189573 5432771 72087906 185497804

Table 9

Source: - Trade and industry, 2002

The above table depict that the major types of economic activities in the city with in a consecutive
five years (i.e. from year 2004-2008). As the table displays the trend of whole sale, retail sale,
service rendering and industry traders increase yearly. The total number of traders involved in the
whole sale, retail sale, services rendering and industry with in a consecutive five years (i.e. from
2004-2008) are 10578 with a total capital investment 295,866,596 birr. The services render sector
(business center, cafeteria, market centre, construction machineries supply, Garage, bread and
cake bakery, fuel station etc) has the highest share with about 47.71% of employment generation.

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 This indicates the dominant economic base in terms of capital investment and employment
generation is service and trade sector (To get additional insight about the status of private
investment in this sector please refer table 3.6 in the annex
Tourism Sector Table 3.6: Performance of Tourism Sector in the year 1998-2002
Y e a r R e v e n u e No. of Tourists

1998 6390 3 7 6

1999 7 9 9 7 3 7 9

2000 7 9 8 7 3 9 2

2001 1 3 0 5 7 3 2 0

2002 2 3 6 8 0 4 7 3

TOTAL 59,111 BIRR 1 9 4 0

Table 10

Source: Zone Tourism office, 2003

There are three major categories of tourist attraction centers in gedeo zone. These are historical, natural
and cultural attractions. Currently culture and tourist office identify 9 different centers of attractions
under each category. The amount of revenue generated from this sector in year 1998 up to 2002 is
59,111Birr from 1940 tourists visit the area. Hotel and tourism sector contribute to about 14.5% of
employment generation n the city. The status of private sector investment on hotel and tourism also
shows increasing trend

Economic problem
Economic problems can vary widely and are influenced by factors such as local industries, government
policies, infrastructure, education, and more. To identify the economic problems of Dilla Town, you may
want to consider the following:

1. Unemployment

High levels of unemployment can be a significant economic problem. Analyze the unemployment rate,
types of jobs available, and the overall labor market conditions in Dilla Town.

2. Industry and Diversification

If the town relies heavily on a single industry, economic downturns in that sector can lead to issues. A
lack of economic diversification may make the town more vulnerable to external shocks.

3. Infrastructure

The state of infrastructure, including transportation, utilities, and communication networks, can impact
economic development. Inadequate infrastructure may hinder business activities and investment.

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4. Education and Skills

A skilled workforce is crucial for economic development. Assess the educational opportunities and skill
levels in Dilla Town. Insufficient education and training programs may limit the town's economic
potential.

5. Access to Capital:

Availability of financial resources and access to capital can be a challenge for businesses and
entrepreneurs. Investigate the local banking system and the ease of obtaining loans.

6. Government Policies:

Examine local government policies and regulations. Business-friendly policies can encourage economic
growth, while excessive regulations may hinder development.

7. Income Inequality:

Disparities in income distribution can lead to social and economic challenges. Evaluate the distribution
of wealth and income in Dilla Town.

8. Natural Resource Management

If the town relies on natural resources, sustainable management practices are crucial. Overexploitation
or mismanagement of resources can lead to economic and environmental problems.

9. Market Access:

The ability to access broader markets for goods and services is essential for economic growth. Evaluate
trade routes, market connections, and barriers to market entry.

10. Global Economic Factors

Consider the impact of global economic trends on Dilla Town. Factors such as international trade,
exchange rates, and geopolitical events can influence the local economy.

To obtain the most accurate and up-to-date information on the economic problems of Dilla Town, it is
recommended to consult local government reports, economic studies, and community organizations.
Local news sources and government publications can provide valuable insights into the specific
challenges and opportunities facing the town

Local economic
To understand the local economy, you might want to look into key industries, businesses, employment
trends, and any recent developments or projects that could impact the economic landscape. Common

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factors influencing local economies include agriculture, manufacturing, services, tourism, and any major
infrastructure projects.

Consider consulting local news sources, economic reports, or reaching out to local authorities for the
latest information on Dilla Town's economic situation. Keep in mind that economic conditions can vary,
and it's essential to rely on the most recent and reliable sources for accurate insights

Concerning the type of agricultural products, production of cereals, livestock, poultry, milk, hide
and skin, meat, vegetables and fruits . This implies that the weather condition is favorable for
production of different agricultural products. According to the data gathered from this office indicate
that majority of urban agriculture activity are found in sesa and harowolabu sub- cities.

For example some local economic in dilla city are coffee, cloth trade and fruit

Consider consulting local news sources, economic reports, or reaching out to local authorities for the
latest information on Dilla Town's economic situation. Keep in mind that economic conditions can vary,
and it's essential to rely on the most recent and reliable sources for accurate insights Concerning the
type of agricultural products, production of cereals, livestock, poultry, milk, hide and skin, meat,
vegetables and fruits . This implies that the weather condition is favorable for production of different
agricultural products. According to the data gathered from this office indicate that majority of urban
agriculture activity are found in sesa and harowolabu sub- cities.

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Conclusion
In conclusion, the economic analysis conducted in this report has provided valuable insights into the
urban planning considerations for dilla town. The data and analysis presented have highlighted the
importance of addressing population growth, employment trends, and income disparities in our urban
planning efforts.

The findings suggest that a comprehensive approach to urban development, which includes targeted
economic development initiatives, can lead to sustainable growth and improved quality of life for
residents. Additionally, the report emphasizes the significance of incorporating sustainable and
equitable practices into urban planning to ensure long-term economic viability and social well-being.

It is evident that collaboration between public and private stakeholders, as well as community
engagement, will be crucial in implementing the proposed urban planning strategies. By leveraging the
insights gained from this economic analysis, policymakers and urban planners can make informed
decisions to create a more vibrant, inclusive, and economically resilient urban environment.

Ultimately, this economic analysis report serves as a foundation for informed decision-making and
strategic urban planning that aims to foster economic prosperity and enhance the overall livability of
dilla town.

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References
 Google
 Dilla town structural plan(exsisting situation analysis) document

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