Staff estimates suggest ethiopias terms of trade could increase by about 6 percentage points in fy15. Foreign direct investment fdi in ethiopia nordea trade. This paper investigates the comparative advantage of ethiopia and the role played by international purchasing concept. According to the ministry of foreign affairs foreign trade promotion manual mof,2007 ethiopia s foreign trade policy has three general objectives.
Trade and foreign direct investment fdi figure in the new plan but less reliance is placed on fdi inflows than in the past and as much emphasis appears to be placed on import substitution as on export expansion to reduce the trade deficit. To seek and support peaceful solutions to international disputes. Box 113 addis ababa, ethiopia in collaboration with. It expands the productive capacity of a nation and plays a crucial role in the economic growth and development process. Ethiopia economic analysis of governments policies. Regional and federal investment offices companies and individuals working on import, export and wholesale activities manufacturing industries ministry of foreign affairs and our embassies abroad. Department of commerce, manages this global trade site to provide access to ita information on promoting trade and investment, strengthening the competitiveness of u. Fikadu asfaw and associates law office falo on 11 apr 2011 related to trade policy and regulations in ethiopia. Overview of ethiopian investment opportunities and policies. United nations conference on trade and development.
Trade and foreign direct investment fdi figure in the new plan but. This not only informs the level of bilateral trade ties that ethiopia has had with china as compared to any other country in the region but also signifies the highest. Compared to other countries in the region, the amount of foreign investment in ethiopia during this period was equivalent to only 5. It contains the full text of the laws and offers userfriendly tools for searching and filtering for selected provisions that are specifically relevant to foreign investors. Located in northeast africa the fastest growing economy in africa the second most populous nation in africa with a dominantly young and productive population has huge untapped resources a multiparty democracy one of the oldest nation on the planet. Admission foreign investors can invest alone or in. National policy principles and objectives ethiopia. Ethiopia dfat department of foreign affairs and trade. Trade data dissemination contd non regular users private investors governmental investment institutions i. Ethiopia originally signed a treaty of amity and economic relations with the united states in 1951, which was updated in 1994. Guided by this policy, ethiopia has registered remarkable economic achievements, especially during the past twelve years. Admission foreign investors can invest alone or in partnership with domestic investors in areas open for fdi.
Policy priorities for the new government as ethiopias new government begins work in september 2010, it is. This is the fifth of eight annual reports under agoa. It is one of the fastest growing economies in the world based on a 20102014 average, albeit from a low base. Department of state 2015 investment climate statement may 2015 5 the 2012 amendment to ethiopias investment proclamation introduced provisions for the establishment of industrial development zones, both staterun and private, with favorable investment, tax, and infrastructure incentives. Import policies ethiopia is not a member of the world trade organization wto, but is actively involved in a wto accession process. Pulses sector investment profile international trade. The government of ethiopia publicly pronounces its adherence to the ideology of the developmental state. Ethiopia commercial guide international trade administration. Strategic and tactical issues of ethiopias foreign policy.
Inferences from a dynamic gravity approach article pdf available in international journal of economics and business research 94. Foreign direct investment in ethiopia dropped by a fifth in the first half of the countrys fiscal year after violent antigovernment protests in which foreignowned businesses were targeted. Our mission in ethiopia works to advance an environment that supports increased private sector investment and growth. Ethiopia is a member of the common market for eastern and southern africa hence it is one of the key players in.
Determinants and potentials of foreign trade in ethiopia. Ethiopian investment policy the ethiopian constitution and the investment law guarantee protection of private property and investment in addition, ethiopia is a signatory of 29 bilateral investment treaties and 6 multilateral investment agreements that stipulate. Ethiopian business development services network ebdsn p. Investment proposal in ethiopia pdf business plan for a commercial teff farm in 2018512 business plan for a commercial teff farm in ethiopia by san luis obispo august, 2012. Between 2006 and 2017, middle eastern fdi in operation in ethiopia equalled 28 billion birr, accounting for 31% of all fdi. Under a bilateral investment treaty to which ethiopia is a party, investment is defined as. Investment policy and promotion strategy for ethiopia to 2010. Government procurement and trade and the environment in ethiopia.
This is intended to ensure that the investment has been. Broad policy discretion over tariffs and other trade measures are in the hands of ethiopia s policy makers. To observe international agreements which ensure respect for ethiopias sovereignty and are not contrary to the interests of its peoples. As ethiopias new government begins work in september 2010, it is armed with a new plan.
Any kind of asset and any direct or indirect contribution in cash, in kind or in services, invested or reinvested in any sector of economic activity. Ethiopia investment guide 20172018 aln ethiopia mesfin. The current report builds on the information provided in previous reports, providing new and updated information on u. Feb 15, 2017 foreign direct investment in ethiopia dropped by a fifth in the first half of the countrys fiscal year after violent antigovernment protests in which foreignowned businesses were targeted. Ethiopia has no bilateral trade or investment agreement with the united states. Foreign investment in ethiopia slumps after business attacks. Pdf the role of trade policy on ethiopias leather industry. Overview of ethiopias investment policies and incentives the policy for ethiopian investment has been modified in the last 20 years for more than 4 times.
Generally speaking, djiboutis trade policy is intended to promote diversification of the production system, with a larger privatesector contribution to gdp excluding port activities, an increased secondary sector share, and business formalization and structuring. Economic policy analysis this site presents an analysis of the ethiopian governments economic policies compared to a revised list of 34 economic policies as prepared by student serkalem tekletsadik with the mckeever institute of economic policy analysis miepa in december 20. Therefore, this dissertation tries to provide some reflection on the paradox created. The investment laws navigator is a comprehensive and regularly updated collection of national investment laws. Trade and foreign direct investment fdi figure in the. Improvements in terms of trade also support the external sector. To take advantage of a good understanding of the investment climate gained from entrepreneurs social networks. According to the economic reform and adjustment programs undergoing in the country, structural and organizational changes, significant both in magnitude and depth are taking place in all the social and economic sectorsof the country. However, the gap between domestic investment and savings has remained wide. The ethiopian diaspora in canada numbers some 44,000 people. As shown in table 1, domestic investment in ethiopia has increased r apidly since the introduction of liberal policies in 1992. Privilege to full repatriation of profits, dividends, principal and interest payments on external loan, etc.
Investors domestic and foreign can engage in industrial parks development. In the past five years, ethiopia has experienced substantial growth in all three major economic sectors agriculture, industry and services. Investment guide for ethiopia business environment investment policy investment areas incentivesguarantees taxation investment opportunities investment procedures addis ababa, ethiopia january 2004 published by. Ethiopia, recognizing the vital principle of unity in diversity, the need for tolerance and accommodation in light of the diversity of languages, cultures and faiths. Ethiopia investment policies and incentives and opportunities. The ethiopian government has formulated and started the implementation of the second five year growth and transformation plan gtp to carry forward the important strategic directions to maintaining a fast growing economy in all sectors. Ten year road map 20102020 1 dated august 5 th 2010. Ethiopian foreign trade statistics collection, compilation. Ethiopias admission policy has been modified more than four times in the last 22 years in favor of investors.
Canada and ethiopia hold strategic annual bilateral consultations, which cover issues as diverse as foreign policy, trade and investment, innovation, science and technology, the environment and climate change, education and culture. Ethiopia proclamation on investment investment laws. Ethiopia s vision of becoming a middle income country by 2025 is built around economic, social, and environmental pillars ethiopian investment comission 4 ethiopia envisions to become a middle income country and leading manufacturing hub in africa by 2025. As shown in table 1, domestic investment in ethiopia has increased rapidly since the introduction of liberal policies in 1992. Inflation is also expected to decline, especially due to indirect impact and its positive effect on expectations. Ethiopia, trade policy, liberalization, trade costs, facilitation. Nonetheless, ethiopia has a low share of trade in gdp, its exports continue to have limited diversification, and its trade deficit has widened significantly. Business plan for a commercial teff farm in ethiopia author. Ethiopia is currently the 87th largest export market for u.
Linguistically, the country is a mosaic of about 100 languages that can be classified into four groupssemitic, cushitic, omotic and nilotic. According to the ministry of foreign affairs foreign trade promotion manual mof,2007 ethiopias foreign trade policy has three general objectives. Investment objectives of the federal democratic republic of ethiopia the objectives of the investment policy of the federal democratic republic of ethiopia are designed to improve the living standards of the peoples of ethiopia through the realization of sustainable economic and social development, the particulars of which are the following. The role of trade policy on ethiopias leather industry. An investment guide to ethiopia import duty exemption on import of capital goods, construction materials, spare parts with a value up to 15% of the total value of capital goods 100% of total value. To forge and promote ever growing economic union and fraternal relations of peoples with ethiopias neighbours and other african countries. However, reformative policies aimed at ensuring rapid integration into the multilateral trading system are not yet fully in place or implemented to complete wto accession. Ethiopia has tried different trade strategies in the past, the perennial goal being to diversify its exports to reduce dependence on coffee and other cash crops.
The first is developing and ensuring broad international market for the countrys agricultural products and the second one. The contents of this document are derived mainly from ethiopias agriculture sector policy and investment framework. Facilitate access to foreign capital, skills and technology. On the other hand the nucleus of wto principles is progressive trade liberalization. Trade policy reform measures included import liberalization through rationalization of the tariff structure and reduction of quantitative restrictions, simplified licensing procedures, the introduction of marketoriented and more transparent allocation of foreign. Ethiopia trade and transformation enhanced integrated. However, the gap between domestic investment and savings has remained wide thereby reinforcing the need for fdi in the development of the economy. Ethiopia is a member of the common market for eastern and southern africa hence it is one of the key players in trade in the region. Introduction investment is an act of current spending for expected future return. Regional and federal investment offices companies and individuals working on import, export and wholesale activities manufacturing industries ministry of. This not only informs the level of bilateral trade ties that ethiopia has had with china as compared to any other country in the region but also signifies the highest and the closest level of bilateral relations that ethiopia has. Pulses trade performance pulses investment opportunities 15 ethiopias trade and investment climate 16 trade agreements 16 trade and investment trends 17 access to finance and insurance 20 taxation 22 investment and export incentives 23 labour market, land and infrastructure 25 investment startup procedures 30 references 34. The survey finds that the social networks of chinese investors function as a significant factor in making their investment decision in favor of ethiopia.
62 205 1122 687 1557 685 748 311 948 635 773 1618 964 766 1478 1207 157 936 1149 1284 1169 162 338 822 663 458 354 1422 1060 80 933 358 454