Thanks to its diversified landscape, agro-ecology, and fertile soils with vast arable land (74.3 million hectares), the Ethiopian agricultural sector has much to offer: from coffee to livestock passing through oilseeds and flowers. In order to take full advantage of this diversity, important steps were made by the Ethiopian Government in the last two decades to accelerate growth and transformation in this sector, which remains a predominant in the Ethiopian economy. In fact, it is accounting for nearly 42.9% of the gross domestic product (GDP), about 90% of foreign currency earnings and 82% of employment. The transformation of the agriculture of other sectors of the economy. Recognizing that large capital investments are needed to exploit Ethiopia’s resources, incentives are being provided to encourage foreign investment (including joint ventures and marketing arrangements).

To accelerate the pace of the programme, the Agriculture Transformation Agency (ATA) was launched in 2011 with the aim of disseminating sector is therefore central to drive the economy transition to a manufacturing based economy and to reach middle-income country status by 2025.

Launched two decades ago, the Agricultural Development Led Industrialization (ADLI) strategy put agriculture at the forefront of Ethiopia’s development process and provided an overarching plan for economic development on the basis of agricultural transformation. The goal is to increase productivity leading to higher employment, incomes, and investable surplus for the development improved planting, fertilizing and harvesting techniques and ensure that these new practices are adopted by smallholder farmers. The ATA is scaling up these best practices through a network of agriculture extension workers and innovative ways of communication, such as an interactive voice response and SMS system providing smallholder farmers free with information on cereal, horticulture, and pulse/oil seed crops, as well as a wide range of agriculture-related activities and innovations. Ethiopia is the origin and largest producer of coffee in Africa and the fifth worldwide, with a reputation for producing some of the world’s finest organic coffees. The soil of the forest floor is enriched from falling leaves, making fertilizers unnecessary. Most regions of Ethiopia are furthermore suitable for the production of a wide range of tropical and sub- tropical fruits, vegetables and flowers, thanks to the country’s favorable climate, abundant labor, fertile land and water resources. Cut flower and vegetable production are fast growing export businesses, and Ethiopia is a center of diversity for a variety of flowering plants. While the contribution of the livestock industry to the country’s total exports is currently low compared to its potential, this sector also holds great promise as a source of export diversification for the future. The export of finished leather and leather products (such as leather garments, footwear, gloves, bags and other leather articles) has been increasing over the last years.

Moreover, some other parts of the sector represent substantial opportunities for new investment: plantation crops (such as tea and tobacco); production and processing of oil crops and cotton; fish farming; forestry and forest by-products. Ethiopia is also the home of the gluten-free cereal teff, which has been the main ingredient of Ethiopian food for thousands of years. Thanks to its rich nutritious characteristics, there is a global growing demand for teff.

Finally, Ethiopia has tremendous and potential for investment in agro-processing. While the government encourages the export of unprocessed agricultural products, it has placed incentives for investment and export of processed products, which involve and stimulate the growth of the agro- processing sector. Through the development of agro-processing, Ethiopia’s agricultural sector can achieve swift and sustained long-term economic development.

Report written by the Embassy of Ethiopia in Brussels

By virtue of its location, dynamism and export incentives, Ethiopia has a high potential in trade.

Ethiopia is the second most populous country in Africa and thus potentially one of the largest domestic markets on the continent. By virtue of its membership to the Common Market for Eastern and Southern Africa (COMESA) embracing 19 countries with a population of about 400 million, Ethiopia enjoys competitive market access to these countries. The country moreover qualifies for preferential access to European Union market under the EU’s Everything-But-Arms (EBA) initiative and to USA markets under the African Growth and Opportunities Act (AGOA). Furthermore, a broad range of manufactured goods from Ethiopia are entitled to preferential access under the Generalized System of Preference (GSP) in the USA, most countries of the EU and other developed countries. No quota restrictions are placed on Ethiopian exports falling under the 4,800 products currently eligible for GSP treatment. Ethiopia’s proximity to the Middle East and Asian markets also offers further potential market opportunities.

Exports from Ethiopia are very dynamic, and their main destinations include China, Germany, Switzerland, Saudi Arabia. While the share of manufacturing products is increasing, exports in the agricultural sector are also on the rise: between 2012-2013 and 2013-2014, exports revenues from agricultural products are expected to grow by 16.3 percent, with a total revenue of more than 2.5 billion of dollars, according to the Ministry of Trade. The top export items include coffee, oil seeds, cereals, spices, natural gum and incense. Other common agricultural exportable items are fruits, vegetables and flowers, livestock and meat, pulses and oilseeds, spices and cotton. Agro-processed products include beeswax, honey and civet, fish, hides and skins. The manufactured products include leather products, textiles, wool, building materials, beverages, marble, granite and traditional handcrafts.

Ethiopia has followed an export led free market economy in which the government plays a facilitation role in the sector by providing several incentives and building huge infrastructures to boost the sector. In order to enhance the export sector, the Government has established the Ethiopia Commodity Exchange (ECX), a marketplace where buyers and sellers come together to trade, assured of quality, delivery and payment. ECX assures all commodity market players the security they need in the market by providing a secure and reliable end-to-end system for handling, grading, and storing commodities, matching offers and bids for commodity transactions, and a risk- free payment and goods delivery system to settle transactions, while serving all fairly and efficiently.

In order to further encourage investors and businesses to engage in exporting Ethiopian products, trade incentives provide advantages to exporters. Several of them are included in the Proclamation No. 543/2007, cited as “The Revised Export Trade Duty Incentive Scheme Establishing Proclamation”. Most notably, the Proclamation provide :

– a Duty Draw-Back Scheme: duty paid at the airport of entry and locally, on raw materials used in the production of commodities, is refunded 100 percent upon the exportation of the processed commodity;

– a Voucher Scheme: a printed document having monetary value, which is used in lieu of duties and taxes payable on important raw materials.

The beneficiaries of the voucher scheme are also exporters; and

– a Bonded Manufacturing Warehouse Scheme: Producers wholly engaged in exporting their products who are not eligible to use the Voucher Scheme can obtain a license that enables them to operate such factory or warehouse.

Moreover, with the exception of semi-processed hides and skins, no export tax is levied on export products of the country, and any investor who exports or supplies to an exporter (production or service input of at least 60 percent of the products or services) shall be entitled to income tax exemption for 2 years in addition to the income tax exemption.

Non-fiscal incentives for exporters include:

– Possibility to retain and deposit in a bank up to 20 percent of their foreign exchange earnings for future use in the operation of their enterprises with no export price control imposed by the National Bank of Ethiopia;

– Franco Valuta import of raw materials for enterprise engaged in export processing; and

– Export credit guarantee scheme, which is presently in place in order to ensure an exporter receives payment for goods shipped overseas in the event that the customer defaults, reducing the risk of operators’ business and allowing it to keep its price competitive.

Report prepared by the Embassy of Ethiopia in Brussels

Ethiopia is becoming an investment destination in the sub-region for the fast paced economic progress it has been experiencing, for the lucrative business opportunities it provides, and for its attractive investment incentives. The country is located in the north-eastern part of Africa, commonly known as the Horn of Africa, at the cross-roads between Africa, the Middle East and Asia. The country has a stable political and economic environment. Thanks to its large population, Ethiopia is potentially one of the largest domestic markets in Africa. By virtue of its membership of the Common Market for Eastern and Southern Africa (COMESA), embracing 19 countries with a population of over 400 million, Ethiopia also enjoys preferential market access to these countries. Ethiopia qualifies for preferential access to European Union market under the EU’s Everything-But-Arms (EBA) initiative and to USA markets under the African Growth and Opportunities Act (AGOA). Accordingly, most Ethiopian products can enter into these markets quota and duty free. Furthermore, a broad range of manufactured goods from Ethiopia are entitled to preferential access under the Generalized System of Preference (GSP) of the USA. No quota restrictions are placed on Ethiopian exports falling under 4800 products currently eligible under the GSP.

The Ethiopian economy is based on agriculture, which contributes about 42.9% of the gross domestic product (GDP), about 90 % of foreign currency earnings and 85 % of employment. However, the industrial sector’s share is growing from year to year. The country is among the top growing economies in Sub-Saharan Africa: for the last ten years, real GDP grew by an average of about 11 percent per year. Ethiopia is endowed with abundant natural resources. Altitude in Ethiopia ranges from 125 meters below sea level in the Danakhil depressions of the Afar region to 4,620 meters above sea level in the Amhara region. Thus the country has 18 major and 49 sub agro- ecological zones, each with its own agricultural and biological potential. Overall, 74.3 million hectars of land are suitable for agriculture (45% of the total area), of which only about 18 million hectares are currently utilized. The climate is suitable for growing over 146 types of crops. Ethiopia possesses one of the largest and most diverse genetic resources in the world. Besides, it has the soils and the climate suitable for the production of a variety of food crops.

The labour law of Ethiopia, prepared in conformity with international labour norms and standards, provides adequate provisions for the conclusion and termination of employment contracts with safeguards that do not infringe the rights of investors. Labour cost in Ethiopia is relatively low compared to the African average. The number of skilled workers and technicians is increasing steadily as a result of an increase in the number of universities, colleges, and vocational and technical training schools in the country. The Ethiopian Government has made commendable efforts, through legislative and procedural reforms, to improve the investment climate of the country and thereby attract more foreign direct investment. In line with market-oriented economic policy, the investment regime has been liberalized through a series of Government legislations. Since 1992, the investment code has been revised three times to ensure the participation of more foreign investments in various sectors of the economy.

In a nutshell, these are the top 10 reasons to invest in Ethiopia:

• Political and social stability
• Macro-economic stability and growing economy; • Adequate guarantees and protections
• Transparent laws and streamlined procedures
• Ample investment opportunities
• Abundant and trainable labour force
• Wide domestic, regional and international market opportunity
• Competitive investment incentive packages
• Welcoming attitude of the people to FDI
• Pleasant climate and fertile soils

Report prepared by the Embassy of Ethiopia in Brussels

Addis Ababa, 23 March 2015 (WIC) – Egypt, Ethiopia and Sudan have signed a declaration of principles on Monday, in a critical step towards resolving a four-year dispute over Nile water sharing arrangements among Basin countries.

The details of the agreement are expected to be announced later.

“For thousands of years, the Nile water has been flowing with God’s order,” El-Sisi told hundreds of Nile Basin delegates who gathered in the Sudanese capital of Khartoum for the announcement of a deal.

“We could cooperate and accomplish great things or disagree and hurt each other…we have chosen to cooperate,” El-Sisi told the audience to strong applause.

Speaking ahead of Egypt’s president, Ethiopia’s Prime Minister Hailemariam Desalegan stressed that the Renaissance dam his country has been building to generate electricity for economic development projects would not cause any harm to the Egyptian people.

“Egypt and the rest of the Nile Basin countries are “one family,” Hailemariam said.

“We covered a big step forward by reaching the declaration of principles,” Hailemariam said.

Ethiopia chose to take the “collaborative path” on the issue of distribution of the Nile water, he added.

Speaking last, Sudan’s President Omar Al-Bashir stressed on the importance of cooperation to fulfill the development goals of the people of the region.

“You are embarking on an historic move… we have taken praiseworthy steps to reinforce and support trust and inter-connectedness between our peoples,” he said.

Al-Bashir said that the declaration of principles signed by the three countries will be observed by all three, adding that the road has been paved for further talks among all Nile Basin countries to reach a broader agreement.

Egypt’s President El-Sisi had arrived in Khartoum on Monday for eleventh hour talks with Sudan and Ethiopia as the three countries prepare to sign a tripartite agreement on Addis Ababa’s giant Nile dam project.

The three countries are also expected to agree on an international firm to conduct studies on the impact of the construction of the dam on flow levels.
Today, El-Sisi will head to Addis Ababa to conduct bi-lateral talks with Ethiopian authorities.

Addis Ababa, 17 March 2015 (WIC) – When looking for opportunities to invest in sub-Saharan Africa, there are few better places than Ethiopia, the East African Business Week reported.

The country enjoys a unique location at the crossroads between Africa, the Middle East and Asia.

The investment law protects private property, but apart from this basic requisite for cultivating business confidence, there are other clear cut guarantees.

A foreign investor has the right to make the following remittances out of Ethiopia in convertible foreign currency at prevailing rate of exchange.

The other crucial thing that ensures investors’ capital is safe is that Ethiopia is a member of the Multilateral Investment Guarantee Agency (MIGA).

This is the World Bank Group affiliate that covers non-commercial risks in signatory countries.

Ethiopia also recognizes all the provisions of the World Intellectual Property Organization, besides having several bilateral agreements with countries that protect investors’ portfolio.

Ethiopia may well be also considered as a country with the lowest levels of crime and corruption among the least developed countries.

The Federal Government has formulated the five year Growth and Transformation Plan (GTP) to carry forward the important strategic directions to maintaining a fast growing economy, projected to grow at average rate of 11.2% annually.

Ethiopia’s economy is still young with vast untapped resources and a range of investment opportunities. The country has comparative advantages in agriculture, agro-processing, leather and leather products and textiles and garments.

However, to ensure an ordered development, the Council of Ministers regulations specify the areas of investment open for foreign investors.

Apart from the areas already mentioned, others with the most promising potential include sugar, chemical and pharmaceutical products, tourism, mining and hydro-power.

Ethiopia’s economy is based on agriculture, which accounts in 2012/13 for about 42.9% of the Gross Domestic (GDP), 90% of foreign currency earnings and 85% of employment.

Generally, the overall economic growth of the country has been highly associated with the performance of the agriculture sector.

Coffee is a critical commodity to the economy. It earned $745.1 million during financial year 2012/13. Other notable products during the same year were gold ($584.4 million); oilseeds ($437.1 million); khat ($270.6 million); live animals ($160 million); leather and leather products ($120.6 million); meat and related products ($74.1 million); fruits and vegetable ($43.7 million).

The industrial sector, which mainly comprises of small and medium enterprises accounted for about 12.4% of GDP in 2012/13. At 45.2% contribution is the growing service sector which is made up of a wide range of enterprises. An investor will find no problem in being interested, although the difficulty will come in choosing exactly where to put their money.

In order to improve the export sector, the Federal Government set up the Ethiopia Commodity Exchange (ECX). This is a marketplace where buyers and sellers come together to trade, assured of quality, delivery and payment. ECX guarantees an end-to-end system that is efficient and fair to all.

During 2012/13, total exports amounted to $3.1 billion. However, there is a huge scope for higher export receipts once a steady diversification from coffee is done through new investment in other areas of the economy.

The Industrial Development Strategy focuses on export manufacturing with priority given to textile and garments, leather and leather products, agro-processing and small and micro-enterprises.

Due to the investment-friendly environment created in the country, the inflow of foreign direct investment (FDI) has been increasing over the last 21 years.

Out of the total investment projects licensed between 1992 and 2012, FDI’s share is about 15.8%.

However, the overall trend of investment in 2012, both in terms of projects and capital, showed a definite increase and this has not change this then.

Ethiopia remains an untapped and unexploited market for investors. A list of the countries that are already involved in the country reflects this attraction. These investors are from China, India, Sudan, Germany, Italy, Turkey, Saudi Arabia, Yemen, the United States, United Kingdom, Israel and Canada.

Addis Ababa, 18 March 2015 (WIC) – Foreign Affairs State Minister, Ambassador Berhane Gebrechristos met with Seán Sherlock, TD, the Irish Minister of State for Development, Trade Promotion and North-South Cooperation on Monday (March 16), to discuss a range of mutually important issues.

Ambassador Berhane said Ethiopia attached great importance to its relations with Ireland. Cooperation between the two countries was growing in areas in which where Ethiopia was working to reduce poverty and achieve the targets set in the Growth and Transformation Plan (GTP).

Ambassador Berhane said that as Ethiopia is preparing to implement GTP II, focusing on agro processing and manufacturing, Irish experience in the agricultural sector would be an inspiration; the two countries were also working closely on climate change and green energy.

Ambassador Berhane also noted Ethiopia was working hard for the resolution of regional interstate conflicts and had committed itself to “Silencing the guns by 2020”, a decision adopted by the last AU summit.

He said Europe could play an innovative role to increase its engagement with Africa. Minister Sherlock said his visit to Africa, and especially to Ethiopia at the time of the celebration of St Patrick, was indicative of the conviction of his Government of the importance of enhancing trade links, investment and other important issues.

He said he would be looking at the development of the Double Taxation Agreement between Ireland and Ethiopia, as well as the bilateral Air Transport Agreement signed on his last visit to Ethiopia, in November last year, when he had accompanied Irish President Higgins.

Sherlock described the air transport agreement as a major milestone in relations between the two countries and one which paved the way for a new Ethiopian Airlines route.

He said “direct flights between Dublin and Addis Ababa, due to start from June, there is huge potential for boosting trade, investment and tourism between Ireland and Ethiopia.”

Sherlock said his Government wanted to take advantage of the opportunities in Africa, and Ethiopia would be a key player in this regard, as the country is expected to be among the 20 fastest growing economies in the world this year. There was great potential for Irish companies looking for mutually-beneficial investment opportunities.
The Minister underlined that Ireland’s long term development assistance to Ethiopia wasone of the strongest cooperation relationships in Europe.

Ethiopia, he said, was one of Ireland’s Key Partner Countries, and he expressed his satisfaction over the growth Ethiopia has registered over the last decade or so.

He said Ireland would support Ethiopia in the implementation of the GTP II, and added that the 20-year roadmap for Irish-Ethiopian relations would heighten the cooperation between “equals” where the private sector would be an active player and Ireland would support Ethiopia’s goals in post-2015 sustainable development. (MoFA

Addis Ababa, 14 March 2015 (WIC) – Propelled by a 10.9% average annual growth rate since 2000, Ethiopia is attempting a major economic transformation to become a hydro-electric powerhouse and a regional airport hub. Of numerous infrastructure projects currently being constructed or planned for the near future, two in particular stand out: the Grand Ethiopian Renaissance Dam (GERD), and a huge new international airport outside of the capital Addis Ababa that will be as big as London’s Heathrow.

The GERD’s foundation stone was set in 2011, and when completed in 2017 it will be Africa’s largest hydropower structure, producing 6GW of electricity from the Blue Nile River. Besides covering Ethiopia’s growing domestic demand, the World Bank estimates that the GERD and other hydroelectric projects could earn the country $1 billion per year in electricity exports. On March 6 the country reached an agreement on principles for peaceful sharing of the Nile River with Sudan and Egypt, seeking to allay its downstream neighbors’ concerns over the GERD. The countries have a formal international agreement dating to 1959 that governs the Nile’s water allocations, and a joint technical committee was formed in 2014 to analyze the GERD’s effects on water security for Sudan and Egypt. However, the dam is a national priority for Ethiopia, and it is fast becoming a reality, so the downstream countries really have no choice but to cooperate and try to ensure their future water flows through friendly diplomacy.

The most innovative aspect of the dam is its financing, which is almost entirely Ethiopian. The $4.8 billion price tag will be met by bond offerings to Ethiopians, private companies, and even neighboring countries like Djibouti, as well as taxes (through a computerized system that makes evasion difficult). Additionally, the state-owned Ethiopian Electric Power Corporation is investing its own revenue and the money it is borrowing from state-owned banks to finance the GERD. It is a symbol of pride that the country does not have to go begging foreign donors to fund the GERD, and other developing countries may emulate the model if it succeeds.

Ethiopia also has big aspirations for its future as an air hub. Within the past decade, passengers at Addis Ababa’s Bole international airport surged from under a million per year to 7 million, just over its nominal capacity. Passenger numbers are expected to continue increasing by 18% a year. In September 2014, China Communication Construction Company began work on a $300 million contract to expand the airport’s capacity to handle 20 million passengers. The previous growth had exceeded all expectations, so the expansion (set for completion in 2018) should serve the country for the next 15 years, according to the project manager.

Separately, the government is narrowing down sites to build a mega-airport with a 70 million passenger capacity at a cost of $2.5- 3 billion. After the site is finalized in the next few months, it will take an estimated eight years to design, finance, and build the airport. With an exclusive highway that links it to Addis Ababa, the mega-hub is expected to serve the country for 100 years, and will be a main gateway to Africa. “A number of international financial institutions have already shown interest” in extending loans for the project, which will be awarded to a company in a “vendor financing scheme,” an official told the Reporter.

Ethiopia still has one of the world’s lowest per-capita income rates, but its impressive economic growth since 2000 led to a 33% decrease in the number of people living in poverty. (Blouin News Blogs)

Ethiopia has a proud and long history extending to the known beginnings of humankind. The fossils of our species’ earliest known ancestor was found in the Danakil Depression in north-east Ethiopia. The Axumite Kingdom was one of the great civilizations of the ancient world and has left behind the mystery of the great stelae found at Axum. In the late Middle Ages great religious civilizations flourished in many parts of the country, particularly at Lalibela where churches hewn out of massive monolithic rock testify not only to great faith but also to great architectural skills. And in the former capital of Gondar many magnificent castles speak of the same legacy.

All these would be enough to make Ethiopia a fascinating place to visit and travel through, but Ethiopia has so much more to offer. Here you can find virtually all the faces of African culture and its landscapes and much of its wildlife. You can travel through high meadow lands reminiscent of Europe or trek across even higher moorlands – in the Simien and Bale mountains – and see unique forms of Afro-Alpine plants, which here grow to an astonishing size. You can explore great rivers and lakes including Lake Tana, the source of the majestic Blue Nile whose valley is one of the world’s greatest, longest and deepest gorges. You can discover the savannas and wetlands of our western region and visit the far south, which teems with wildlife and is home to fascinating ancient cultures. In the great Rift Valley a necklace of beautiful lakes lies beneath the splendid panorama of the Bale Mountains. And in the east, the walled city of Harar speaks of other old civilizations and great faiths, such as Islam. Many kilometers north of there lies the Danakil Depression, one of the world’s most inhospitable but nonetheless dramatic landscapes which is also one of the hottest places on earth. Yet it is home to proud and independent Ethiopian people who have learned to live with their environment, even to benefit from it. Wherever you go on your journey through Ethiopia, you will find many things to enjoy and marvel over, and you can at all times be sure of the warm hospitality of the Ethiopian people.

Seven of Ethiopia’s magnificent historical sites are included in the world cultural heritage list: The Simien National Park, the Rock-hewn churches of Lalibela, the Castles of Gondar and other monuments of Gondar Style, the lower Valley of the Awash paleontological and prehistorical sites, Tiya proto- historical and archeological sites, Axum historical and archeologic, valley of the Omo
paleontological and prehistoric sites.
The Government of the Federal Democratic Republic of Ethiopia extends its warm welcome and wholehearted support to visitors interested in our fabulous tourist attractions and to the investors needed as partners in the further development of our tourism resources.

Addis Ababa, 12 March 2015 (WIC) – South Sudanese warring parties, who failed to reach agreement on power sharing ratio, will resume peace talks in the coming month of April, the Ministry of Foreign Affairs announced.

The warring parties, failed to reach agreement by the deadline, 5 March, will continue the negotiations, Spokesperson Tewolde Mulugeta told reporters during a weekly briefing.

Since the two sides failed to reach agreement during the final session of the IGAD led peace talk held in Addis Ababa from3rd to 6th March, the upcoming talks would involve other stakeholders including African and international community, he said.

The two parties will continue their talks with the presence of representatives from the African Union, United Nations Security Council, and governments of US, British and Norway, Tewolde said.

President Salva Kiir and his rival Rick Machar didn’t agree on the power sharing ratio, since both parties want the highest position for themselves.

Though the two parties agreed on 1st February this year to reach agreement no later than 5th March, in the final session of the negotiation, but they failed to do so.

The parties were negotiating on critical agendas, including the structure of the executive of the transitional government of national unity and the power sharing ratios.

In his speech to the people of South Sudan following the conclusion of the talks without results, Ethiopian Prime Minister and IGAD Chair HaileMariam Desalegn condemned both sides for not considering the safety and wellbeing of their people, “rather than only reiterating old positions”.

He said the refusal by both sides to compromise differences would prolong suffering of the people of South Sudan saying it is unacceptable both “morally and politically.”

The other agenda the Spokesperson raised was the issues of the tripartite national committee formed to hire the consultant firm for the recommended additional researches to be conducted on the Ethiopian Dam.

The water ministers of the three countries, Ethiopia, Egypt and Sudan, reached on a political consensus during their meeting last Friday in Khartum, Sudan, he said.

According to Tewolde, the national committees of the three countries have already selected the firm that will consult the researches.

According to ENA, the firm will be publicized and contract agreement would be signed soon, he added.