Abstract:
Ethiopia is among the fastest-growing non-oil economies, driven by government
reforms that have attracted foreign direct investment and expanded commercial
agriculture and manufacturing. According to the National Bank of Ethiopia,
urbanization has been closely linked to economic growth. A 2015 World Bank
report indicates that Ethiopia’s economy grew at an average rate of 10.4%
between 2003 and 2013, with cities contributing 38% of gross domestic product
while employing only 15% of the workforce. Urban entrepreneurs play a vital role
in addressing social and economic challenges through innovative business
solutions. This study examines the contribution of entrepreneurial activities to
inclusive urban development. Using both qualitative and quantitative data, the
investigator employed purposive sampling to survey 80 entrepreneurs with over
five years of experience from a pool of 150. Findings show that 55% of
respondents operated in organized groups of more than five members, while 90%
had hired staff, indicating the role of micro-enterprises in employment creation
and economic empowerment. Micro-enterprises contribute to urban economic
development by improving entrepreneurs' financial conditions, paying taxes, and
supporting local government initiatives in Holeta town. The study recommends
that local officials expand opportunities for micro-enterprise organization and
improve financial access through simplified loan procedures. Additionally,
cooperative promotions and trade structures should enhance market access for
entrepreneurs
