ADDIS ABABA – Ethiopia is rapidly reinforcing its position as one of Africa’s most promising foreign direct investment (FDI) destinations, thanks to economic reforms and growing investor confidence, according to CBE Capital.
In an interview with international media, Cofounder and CBE Capital CEO Zemedeneh Negatu emphasized Ethiopia’s growing reputation as a top-tier, long-term investment hub. He attributed this progress to the country’s favorable investment landscape and ongoing economic liberalization.
“As the second most populous country in Africa and one of the fastest-growing economies in sub-Saharan Africa, Ethiopia is attracting increasing interest from global investors,” Zemedeneh said. “The long-term economic potential is clear, and investors are taking notice.”
According to the latest UNCTAD report tracking global FDI trends, Ethiopia has consistently ranked among the top five FDI destinations on the continent over the past five years.
Zemedeneh noted that the country is drawing capital from a broad range of sources. While Chinese investment continues to play a dominant role, countries such as the United Arab Emirates and Turkey have also become significant contributors. Moreover, there is a growing interest from European investors, reflecting Ethiopia’s expanding global appeal.
He also highlighted increasing engagement from the United States, particularly under the current administration, which appears more committed to deepening trade and investment ties with Africa. “The U.S. has the financial resources and strategic interest to invest in sectors like labor-intensive manufacturing-including apparel and footwear-where Ethiopia is well-positioned to become a key exporter,” he noted.
Zemedeneh pointed to past comments by U.S. leadership suggesting that such jobs are not a priority for the domestic economy, thus creating a strategic opening for African countries. He welcomed the reopening of the U.S. International Development Finance Corporation’s office in Addis Ababa as a promising development, indicating renewed American focus on the region.
Ethiopia’s decision to open its banking sector to foreign investment for the first time in five decades has also generated substantial interest. Banks from Kenya, Nigeria, South Africa, and the Gulf region are now exploring entry into the Ethiopian market.
Further liberalization of the retail sector has also paved the way for global brands to invest. Zemedeneh revealed that one of the world’s largest supermarket chains has formally applied for a license to operate in Ethiopia-a move that signals new opportunities for international retailers and investors.
As Ethiopia continues to liberalize its economy and improve the ease of doing business, Zemedeneh anticipates a more diversified and sustained flow of FDI. These reforms, he said, will solidify Ethiopia’s status as a rising star in Africa’s investment landscape.
BY FIKADU BELAY
THE ETHIOPIAN HERALD WEDNESDAY 4 JUNE 2025
