Why Invest in Ethiopia?
A land of vast opportunities
Stable political climate;
Liberalized free market economy;
Conducive macro economic policies and stable foreign exchange
Huge home market of 65 million people;
Access to 23 African countries through the Common Market for
Eastern and Southern Africa;
Preferential treatment to the European market under the ACP-EU
Favorable export market status under the US Generalized System
of Preference (GSP);
Huge domestic raw material base;
Abundant and inexpensive labor force;
Strategic location with proximity to the lucrative markets of
the Middle East, Europe and Asia;
Attractive incentive packages;
Participation in the privatization opportunities;
One-stop-shop service by the Ethiopian Investment Authority to
facilitate all pre and post investment requirements.
Agriculture is the main stay of Ethiopia’s economy providing
employment to 80 % of the population. Furthermore, agriculture
plays a crucial role in providing raw material inputs for the
wide ranging agro-ecological zones and diversified resources,
Ethiopia grows all types of cereals, fiber crops, oil seeds,
coffee, tea, fruits and vegetables. The potentially irrigable
land is estimated at 10 million hectares.
Ethiopia has the largest livestock resources in Africa. Fishery
resources are also significant.
opportunities exist for new private investment in the production
and processing of the above agricultural crops and resources.
The following areas in particular have been identified to offer
plenty of opportunities to private investors.
The food crops
grown include teff, wheat, maize, beans, peas, lentils,
soyabeans, chickpeas etc. Great opportunities, therefore, exist
for commercial production and processing of these food crops.
Some pulses can also be produced or processed for the export
Oil crops such
as rapeseed, linseed, groundnuts, sunflower, niger seed and
cottonseed serve as raw material inputs for the edible oil
industry. Some oilseeds, including sesame, are import and export
crops. Favorable agro-climatic conditions also exist in the
country for introducing coconut for the production and
processing of palm oil and ghee. Besides, Ethiopia has a huge
potential for producing and processing of maize.
Ethiopia’s gift to the world. The country is Africa’s leading
producer of Coffee Arabica. Coffee remains the single most
important cash crop.
Tea is also
another potential for production, processing and export.
Ethiopia’s tea is of an excellent *uality. The favourable
agro-climatic conditions in the country offer excellent
opportunities for production and processing of tea for both
export and domestic consumption.
Cotton provides significant opportunities for export. A portion
of the existing textile industry demand of lint cotton is met
from domestic production, the remaining being met through
Ethiopia’s agro-climatic conditions make it suitable for the
production of a broad range of fruits and vegetables, including
citrus, banana, mango, papaya, avocado, guava, grapes, cabbages
cauliflower, okra, egg plant, tomato, celery, cucumbers pepper,
onion, asparagus, water melon, carrots, green beans and cut
flowers. Cut flower and vegetable production are fast growing
export business. The horticulture sub-sector in general holds
great potential for private investment.
The large livestock resources that include 35 million cattle,
11.4 million sheep and 9.6 million goats, as a contributor to
the national economy, leave much to be desired. Therefore,
investment opportunities are potentially attractive for modern
commercial livestock breeding, production and processing of
meat, milk and eggs.
opportunities of significant potential are also available in
ostrich, civet cat and crocodile farming.
Opportunities exist for fresh water fish production and
processing using artificial ponds. In addition, the country’s
fresh water bodies have a potential of an estimated annual fish
production of 30,000-40,000 tons, of which less than ten per
cent is presently being exploited.
Forestry and Apiculture
2.5 million hectares of natural forest presently remains in 58
designated National Forest Priority Areas (NFPA). Investors are
welcome to invest in integrated commercial production of
structural timber, pulp-wood, match wood or even fuel wood.
Production of rubber and natural gum also offers exciting
opportunities for private investment.
With some 3.3
million beehives, Ethiopia is the leading honey and bee wax
producing and exporting nation in Africa. This offers excellent
prospects for private investment in apiculture.
Manufacturing, now at an early stage of development, and
currently accounting for about seven per cent of GDP and 5.3% of
employment, covers about 145 state owned and 643 private
manufacturing industries of all sizes. These industries are
mainly engaged in the production of food products and beverages,
tobacco products, textiles, wearing apparel, tanning and
dressing of leather, footwear, luggage and handbags,
manufacturing of wood and products of wood, manufacturing of
rubber and plastic products, manufacturing of chemicals and
chemical products, manufacturing of other non-metallic mineral
products, manufacturing of basic iron and steel, manufacturing
of fabricated metal products, assembling of motor vehicles,
trailers and semi trailers. Major manufacturing opportunities
offering attractive potential benefits to prospective investors
exist in the food and beverage, leather and electronic, building
materials and non-metallic mineral and metallic industrial
sub-sectors. These investment opportunities include:
Food and Beverage
preserving of meat products; integrated production and
processing of dairy products; manufacture of sugar, brewery,
winery, soft drinks, processing and bottling of mineral water,
Spinning, weaving and finishing of textile fabrics and
production of garments.
Glass and ceramics:
sanitary ware, sheet glass and manufacturing containers.
Tannery, Leather Goods and Articles:
Tanning up to
finishing; manufacture of luggage items, handbags, saddlery and
harness items, foot-ware, garment and integrated tanning and
Chemicals, and Chemical Products:
basic chemicals based on local raw materials, including PVC
granules from ethyl alcohol, formal-dehyde from methanol,
manufacture of caustic soda and chlorine-based chemicals, carbon
black; activated carbon; precipitated calcium carbonate and
Drugs and Pharmaceuticals:
of pharmaceutical, medicinal, chemical and botanical products in
the form of tablets, capsules, syrups and injectables.
and Paper Products:
indigenous raw materials, paper and paper products.
cement, lime, gypsum, marble, granite, limestone, ceramics,
roofing tiles, corrugated sheets, tubes, pipes and fittings.
Electrical and Electronic products:
office, accounting and computing machinery; manufacture of
electric motors, generators, transformers, capacitors,
resistors, switch gears, electrical fittings and integrated
circuit boards; manufacture of radio, television, VCRs,
printers, floppy disc drives, communication and other equipment
and apparatus for the domestic export market.
Manufacture of basic iron and steel, operation of blast furnaces
steel converters, rolling and finishing mills, recycling of
metal waste and scrap.
Manufacture of basic precious and non-ferrous metal; mechanical
working, heat treatment, pleating of ferrous and non-ferrous
structural metal products, reservoirs and steam generators.
Machinery and Equipment:
manufacture of agricultural machinery and equipment, industrial,
transport and mining machinery and parts, construction
machinery, machine tools and accessories, miscellaneous light
engineering products, components and parts.
Ethiopia offers excellent opportunities for mineral prospecting
and development. According to the Ministry of Mines and Energy,
Ethiopia’s green stone belts offer one of the finest areas for
gold mineralization anywhere in the world, and already more than
500 metric tons of gold deposits have been identified by
Government exploration efforts. Additional gold reserves are
expected to be identified in at least seven regions of the
country. In addition to gold, Ethiopia is a country blessed with
good deposits of tantalum, platinum, nickel, potash and soda
ash. Included in the construction and industrial minerals are
marble, granite, limestone, clay, gypsum, gemstone, iron ore,
coal, copper, silica, diatomite, bentonite, etc. With regard to
fossil energy resources, there are significant opportunities for
oil and natural gas in the four major sedimentary basins, namely
the Ogaden, the Gambella, the Blue Nile and the Southern Rift
Valley. For more information click here.
Tourists and writers who have been to Ethiopia wonder why
Ethiopia’s tourism potential is still so little known. According
to December 12, 2002 edition of our world, Those who have
discovered Ethiopia would probably like to keep the secret to
themselves. In any case, the message is staring to filter
through. Tourism in Ethiopia is growing slowly but surely.
The country has
a lot to offer to tourists. Visitors will find landscapes
comparable to its neighboring countries, Kenya or Tanzania, and
awe-inspiring historical sites and monuments similar to its
other neighbors, Egypt.
of Ethiopia have an attractive landscape, scenery and wild life.
In the African Rift Valley system, a wide variety of wildlife
and numerous bird species, both endemic and common, are found
and a substantial volume of traffic is directed to this area.
The magnificent Tis Issat Falls on the Blue Nile (Abay) river,
the endemic wildlife in Semien Mountains, the Sof Omar Cave in
the South East are some of the interesting sites. The rock-hewn
churches at Lalibela, the ancient buildings of Yeha and the
obelisks at Axum, the medieval palaces at Gondar and the
monasteries of Lake Tana, Debre Damo and Debre Libanos are the
Given its unique cultural heritage, magnificent scenery,
pleasant climate, rich flora and fauna, important archaeological
sites, friendly and hospitable people and the recent growth in
the inflow of tourists, Ethiopia’s potential puts it among the
leading tourist destinations in Africa. Tourism infrastructure,
which is still inadequate, should be developed in order to cope
with the growing traffic. There are, therefore, great
opportunities for private investment in hotels, lodges and
The Ethiopian Government recognizes that the delivery of
infrastructure services, transport (road, rail and air),
telecommunications and postal services, energy and water have a
long way to go before they meet the demand of investors. It is,
therefore, making heavy investment in infrastructure development
through on-going power, telecommunications and road sector
development programs to relieve supply constraints and improve
quality of services. Besides, it is widening the opportunities
for private sector participation in infrastructure business of
The Government is planning to assign forty per cent of road
maintenance works to the private sector contractors in the short
term and increase the level to hundred per cent in 10 years. The
power sector program has a plan to increase power generation
capacity from 327MW to 863MW by 2008/09. The private sector has
a role to play by involving in:
consideration of the huge investment required to develop
telecommunications and the importance of Information
Communication Technology (ICT) for economic development, the
Government is considering viable options in the short-to
medium-term. The short-and medium-term alternatives include
finding a strategic partner in the operation and development of
exist for private investment in the following services:
* Exporting the
country’s various products by way of undertaking market
promotion, *quality improvement or packaging;
* construction, comprising first grade contracting and rental of
machinery as well as real estate development.
* Social services, such as health, education and sports
* Other projects in these sectors are to be identified by
Government launched privatization of state owned enterprises in
early 1995. Accordingly, the Ethiopian Privatization Agency
(EPA) was established to implement the privatization program in
the same year.
has laid ground to privatize most of the state owned enterprises
to the private sector. Accordingly, EPA has received a stock of
113 state owned enterprises from the government to be privatized
in the years ahead. As indicated in EPA’s work schedule, out of
these enterprises, a total of 43 state-owned enterprises are in
the pipeline for privatization in 2003. Most of these
enterprises fall under manufacturing, construction, agriculture
and agro-industry, hotels, transport, trade, and mining sectors.
There is a
strong commitment from the Government side to fully privatize
state enterprises in the coming few years.
information on the process of privatization can be obtained from
the Ethiopian Privatization Agency.