With a population of more than 100 million people and a rapidly growing middle-class society, Ethiopia is the second-largest market in Africa and is also part of the Common Market for Eastern and Southern Africa (COMESA) comprising 19-member countries and over 400 million people.
Ethiopia has undergone unprecedented radical political and economic reform in the last 3 years. Despite all the challenges, Ethiopia’s future looks more bright.
Political and Economic reform
The government has focused to smooth business practices and have made major Economic Reform to scale up the ‘Ease of Business’ doing in the country. The majors include Full and partial privatization of State-Owned Enterprises, Liberalization of the aviation, logistics, and telecom industries, Introduction and implementation of Home Grown Economic Reform
Major reform has been implemented to promote democracy and Rule of Law. To mention few, Pardoning political detainees, Allowing political groups in exile to come home, Lifting the state of emergency imposed, Lifted bans on websites and other media, Building peace in the region and the likes.
Growing Economy
An average of about 11% annual GDP growth for the last 14 years. The fastest-growing economy in the world during the same period (World Bank Global Economic Prospects), 46% growth in FDI inflow-one of the most dynamic and largest FDI recipients in Africa (UNCTAD World Investment Report, 2017). Ethiopia is ranked 57th, better than its regional peers (Kenya, Rwanda and South Africa), for its conducive macroeconomic environment (World Economic Forum, Global Competitiveness Report, 2017-2018). Recognized by UNCTAD for promoting investment in the Sustainable Development Goals (SDGs).
Recognized by the World Bank through its “Star Reformer Award” for Ethiopia’s outstanding performance on investment policy reform and promotion. Stable and conducive macroeconomic environment. Stable and positive economic outlook forecasts of more than 7% projected by IMF and the African Development Bank, placing Ethiopia among the world’s growth leaders over the medium term.
Young and Vibrant Labor Force
With a population of more than 100 million people and a rapidly growing middle-class society, Ethiopia is has young and Vibrant Labor Force of median age of 19. Ethiopia’s labor law, which regulates worker-employer relations, is in line with international conventions. Ethiopia is the second-most populous country on the continent with 60% of the population in the labor force. Ethiopia has a young and trainable labor force (median age of 19) and a supportive government policy that facilitates labor sourcing for industries.
Improved Infrastructure
Power production has increased steadily over the last ten years, with 99% sourced from clean energy in the form of hydropower. Ethiopia has the second-largest hydropower potential in Africa (Deloitte, 2014)
The Grand Ethiopian Renaissance Dam (GERD) – the largest hydroelectric power dam in Africa being built on the Nile River – is expected to generate 6,000MW of electricity. This coupled with Gilgel-Gibe III (1,870MW) and Genale-Dawa III (254MW) and other wind power projects will make Ethiopia a regional powerhouse. Cheapest electricity rate in Africa and the whole world.
Expanding Telecommunication Service
Expanding and improving telecommunication service and road networks connecting national and regional markets. Newly built Addis-Djibouti electric-powered railway – making access to port Djibouti much easier. As a significant portion of Ethiopia’s import/export trade passes through port Djibouti, the railway construction is a huge efficiency enhancer. 34 km Addis Ababa light rail is fully operational.
Africa’s world-class and Star Alliance member, Ethiopia Airlines, network covers more than 90 international destinations in the five continents of Africa, Asia, Europe South, and North America. Ethiopian Airlines flies to more than 50 destinations in Africa alone.
Government Commitment
High-level political commitment for investment promotion and protection. Investment policy-making is led by the Ethiopian Investment Board and chaired by the Prime Minister. Wide-ranging incentive packages for priority sectors and export-oriented investments. Bold initiative in the development of state of the art industrial parks, an electric-powered railway connecting the capital and other economic corridors to the port of Djibouti.
Safe and Stable
The Constitution and the investment law protect all private property. A foreign investor has the right to make remittances out of Ethiopia in convertible foreign currency at the prevailing rate of exchange. Ethiopia is a member of the Multilateral Investment Guarantee Agency (MIGA), a World Bank affiliate which issues guarantee against non-commercial risks in signatory countries, and of the World Intellectual Property Organization (WIPO).
Ethiopia has concluded over 30 bilateral investment promotion and protection agreements, of which 11 are with individual European Union Member States. Significant other partners include China, India, South Africa, and Russia, and a number of regional economic partners (Israel, Egypt, and Sudan, among others).
Excellent Climate and Fertile Soils
Ethiopia is the 27th largest country in the world by land size. Given its diverse topography and geographical location, it is suitable for the production of some of the world’s most coveted food crops, such as cereals, pulses, oilseeds, a wide range of fruits and vegetables, coffee, tobacco, sugar cane, tea, and spices, among others
The majority of land in Ethiopia has a surprisingly temperate climate by African standards due to its high elevation. Ethiopia has an elevated central plateau varying in height from 2,000 to 3,000 meters above sea level.
Due to its fertile soils, Ethiopia is among the world’s largest producers of coffee and the 3rd largest producer of Arabica beans in the world (USDA). Ethiopia also the top non-EU exporter of cut-flower to the EU market and the 2nd largest flower exporter from Africa.