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Export Products

Major exports include:
Coffee; hides, skin and leather products; textile and garments; cereal, pulses and oilseeds; meat products and live cattle; fruits and vegetable; cut flowers. Other export commodities include spices, civet, beverages, beeswax, gall-stone and fish.

Coffee
Being the origin of coffee arabica, Ethiopia has immense potential to offer the world market a wide variety of flavors of organically produced, washed and sun-dried coffee. Flavors range from the fruity flavor of Ghimbi to the winery flavor of Limu to the cheesy flavor of Illubabor to the mocha flavors of Yirga cheffe and Harar. Today, coffee consumers worldwide are appreciating the value of organic coffee's natural aroma and flavor. More than 90 percent of the coffee harvested in Ethiopia is organically grown. The inherently superior quality of Ethiopian highland arabica coffee is unmatched, particularly in flavor and aroma. Ethiopia also produces several types of coffee, the water soluble extracts of which can be used for hot beverages, iced drinks, ice creams and in the confectionary industry.

Leather and leather products:
Ethiopia offers a wide range of processed and semi-processed hides and skins to the world market. Some of the products, such as Ethiopian highland sheepskin (which has gained an international reputation for making gloves), are known for their quality and natural characteristics. Ethiopian hide and skin exports include pickled sheep skin, wet blue sheep skin, crust sheep skin, wet blue goat skin, crust goat skin, crust cow hides, finished garment leather, finished glove leather, lining/upper leather, suede leather, full grain leather, embossed leather and patent leather. The export of finished leather and leather products (such as leather garments, footwear, gloves, bags and other leather articles) is also highly promising.

Live animals and meat:
With the largest livestock population in Africa, Ethiopia has an ample supply base for the export of live animals and meat. Its livestock resources are estimated at 27 million cattle, 24 million sheep and 18 million goats. Livestock husbandry is mostly carried out under natural grazing, making the meat and meat products obtained from the animals very tasty and nutritionally healthy for human consumption. Ethiopia's main exports of live animals and meat products include steers and yearlings; lowland sheep and goats; fresh and chilled lamb and mutton carcass; fresh and chilled goat carcass; fresh and chilled veal carcass and beef four quarter; fresh and chilled boneless veal and beef; frozen lamb, mutton and goat carcass and veal and beef special cuts.

Textile Fabrics and Garments:
The textile industry is the largest manufacturing industry in the country. There are more than fourteen major state-owned and private textile and garment factories. The industry employs about 30,000 workers and represents 36% of the entire manufacturing industry. The main textile products manufactured in the country are cotton and nylon fabrics, acrylic yarn, woolen and waste cotton blankets and sewing thread. The domestic potential of cotton production as basic raw material is far more than the demand of the currently installed spinning capacity and the availability of cheap labor is one of the major parameters for considering this industrial sector as one of the strategic industries for export development.

Oilseeds and Pulses:
Ethiopian oilseeds and pulses are known for their flavor and nutritional value as they are mostly produced organically. For instance, the Ethiopian white sesame seed is used as a reference for grading in international markets. In terms of quantity, in 1996-1997, for example, Ethiopia exported 87 thousand tons of oilseeds and 20 thousand tons of pulses. Ethiopia's major oilseed and pulse exports include sesame seeds, nigger seeds, linseeds, sunflower seeds, groundnuts, rapeseeds, castor oil seeds, pumpkin seeds, haricot beans, pea-beans, horse beans and chick peas. Saudi Arabia, Yemen, Israel, EU countries, and some Asian and neighboring African countries constitute the major markets for Ethiopia's oilseeds and pulse exports.

Fruits, Vegetables and Flowers
With a favorable climate, abundant labor, land and water resources, most regions of the country are suitable for the production of a wide range of tropical and sub-tropical fruits, vegetables and flowers. The major vegetable export products include potatoes, green beans, okra, melon, white and red onions, shallots, cabbage, leeks, beetroot, carrots, green chilies, tomatoes and lettuce. The main exportable fruits include oranges, mandarin grapefruit, mangos, guavas, lemons and limes, while cut flower exports include statice, allium, roses and carnations.

Tea
The quality of tea mainly depends on climatic conditions, the type of soil upon which the plant grows and the method of processing. In Ethiopia, tea is mostly grown in the highland dense forest regions where the land is fertile and thus the use of fertilizer is very minimal. Moreover, the availability of abundant and cheap labor in the country has made the use of manual weeding, instead of chemical seeding, possible. Because of this mostly organic cultivation, Ethiopian tea is increasingly sought for its aroma and natural flavors. This is confirmed by the "International Gold Star" award for quality, recently given by B.D.I in Madrid, Spain to one of the major Ethiopian tea exporters: Tea Production and Marketing Enterprise.

Natural Gum
Ethiopia is endowed with distinct climatic conditions that enable it to grow diverse plant species, which are used for industrial and pharmaceutical purposes. Acacia, commiphora and boswellia are examples of one group of plant species that grows in the arid and semi-arid areas yielding gum. The increasing consumption of convenience foods has enhanced the growth of gum production and use over the past several years. As in most other sectors of the additive industry, increasing health consciousness has tended to fuel the demand for thickeners of natural origin. The major gum products produced mainly for export are gum olibanum derived from boswellia, gum myrrh and oppoponex derived from commiphora and gum Arabic derived from acacia species. Apart from their pharmaceutical applications, these products have a wide-range of industrial uses in such areas as beverages, candies, chewing gum, confectionaries, dairy products, gelatins, nut products, puddings and canned vegetables. Typical applications for gum products include: adhesive thickeners; thickeners, stabilizers, flavor, fixatives and emulsifying agents in food products; clarification in beverages; release agents for rubber products and formulations in cosmetics.

Mineral products
According to studies, there are diverse mineral deposits in various parts of the country that can meet export standards. Minerals currently being exported include gold, platinum, marble, granite and tantalum. Export of these minerals is on a very limited scale relative to their immense export potential. Other metallic and non-metallic substances that have also been identified in the country include copper, lead, zinc, silver, gypsum, limestone, quartz and pyrite. Most Ethiopian mineral products are exportable to markets in East and Southern Africa and in Asia and Oceania. Due to freight costs, Ethiopian exports have an advantage in these regions of the world over established exports from Europe and North America. Ethiopia has also recently entered into the export of high quality dimensional stones (i.e., different types of unprocessed blocks, as well as processed marble, granite and limestone suitable for both internal and external uses.

Export Related Facilities

Please Visit: www.ethioexport.org

 

Major imports include:
Aircraft; motor vehicles, agricultural and industrial machinery, equipment and spare parts; chemicals and pharmaceuticals; petroleum products; food products; garments and footwear; building materials.

 

For further Information: contact us

E-mail:- ethemb.investment@telia.com

 

  Important Notes

Import and Export Business in Ethiopia: Methods of Payment.

An Ethiopian importer or exporter who is engaged in import or export business in Ethiopia should know what type of import export payments in Ethiopia are possible while doing import or export trade in Ethiopia or with Ethiopian businesses.

Methods of Payment

  • Letter of credit L/C

  • Cash Against Document

  • Telegraphic Transfer

  • Advance Payment

Types of L/C

  • Irrevocable Vs Revocable

  • Confirmed Vs Unconfirmed

  • Straight Vs Negotiable

  • Sight Vs Usance

  • Documents to be included in L/C

  • Transaction Steps of L/C

Letter of credit (L/C)

  • It is a written commitment to pay, by a buyer's or importer's bank to the seller's or exporter's bank. LC guarantees payment.

  • A supplier or exporter that has sold to an Ethiopian Importer on LC basis should present to the bank these four sets of documents: Original sets of CLEAN Bill of lading, Shipping Document (Airway Bill, Truck way bill or Railway Manifest), Commercial Invoice that’s verified by the chamber of commerce of the supplier’s country, Packing List and Certificate of Origin that’s verified by the chamber of commerce of the supplier’s country. If the goods are imported from China, a CIQ certificate (pre shipment inspection certificate carried out by China AQSIQ) should be presented along with the other four documents.

  • The two most basic types of L/C are Revocable-credit L/C and Irrevocable-credit L/C, which comes in two versions: Confirmed irrevocable letter of credit and Non-confirmed irrevocable L/C.

Cash Against Documents (CAD)

  • A transaction in which the buyer assumes the title for the goods being purchased upon paying the sale price in cash. It’s quicker than LC, but not as safe; Ethiopian exporters are advised to use CAD is they have a very good relationship with the buyer and know that the credentials of the buyer make it trustworthy.

  • A supplier or exporter that has sold to an Ethiopian Importer on CAD basis should present to the bank these four sets of documents: Original sets of CLEAN Bill of lading, Shipping Document (Airway Bill, Truck way bill or Railway Manifest), Commercial Invoice that’s verified by the chamber of commerce of the supplier’s country, Packing List and Certificate of Origin that’s verified by the chamber of commerce of the supplier’s country. If the goods are imported from China, a CIQ certificate (pre shipment inspection certificate carried out by China AQSIQ) should be presented along with the other four documents.

Telegraphic Transfer (TT)

  • It’s a method of payment in which funds are transferred via telegraph or cable. It’s most common in business conducted in developing countries, where other types of infrastructure, such as computerized payments, may not be available; however, in Ethiopia all imports, of which value is more than USD 2000, are required to be done via LC or CAD.

Advance Payment

  • An advance payment, or simply an advance, is the part of a contractually due sum that is paid in advance for goods or services, while the balance included in the invoice will only follow the delivery. It is called a prepaid expense in accrual accounting. In Ethiopia an advance payment of up to USD 5000 may be allowable and can be done through Telegraphic Transfer.

Types of L/C

1. Revocable L/C Vs Irrevocable L/C

Irrevocable L/C

If this type of L/C is once opened, it can not be changed or cancelled or amended without the consent of all parties (including the beneficiary or the seller).

 

Revocable L/C

 

A revocable L/C may be amended or cancelled by the Issuing Bank at any moment and without prior notice to the Beneficiary. The cancellation is usually made at the request and on the instructions of the applicant.

2. Confirmed L/C Vs Advised (Unconfirmed L/C)

Confirmed L/C

It is a type of L/C in which the Confirming Bank promises to pay.When an exporter exports to a country with economical or political instability or if the exporter is unfamiliar with the Issuing Bank, the exporter should require that the L/C be confirmed by a first-class bank. If L/C is confirmed, the confirming bank is liable for the payment. The payment is assured even if the importer or the issuing bank defaults. However, under normal circumstances, an unconfirmed LC may be preferred to avoid the charges that would be paid by both the buyer and seller for confirmation.

Advised L/C (Unconfirmed L/C)

Is opened by an issuing bank in which the advising bank does not add its confirmation to the credit. The promise to pay comes from the issuing bank only.

3. Straight L/C Vs Negotiation L/C

Straight L/C

It can only be paid in the country of the Paying Bank.

Negotiation L/C

It can be presented and paid to any bank.

4. Sight L/C Vs Usance L/C

Sight L/C

The Beneficiary is paid as soon as the Paying Bank has determined that all necessary documents are in order.

Usance L/C

Usance time can be between 30 and 180 days after the bill of lading date. This is a form of delayed payment, and should be avoided.

Links

Ethiopian Coffee and Tea

Ethiopian Business Development Service Network

Ethiomarket

Ethiopian Shipping Lines

Ethiopian Air Lines - Stockholm

National Bank of Ethiopian

Addis Ababa Chamber of Commerce

Ethiopian Export Promotion Agency


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