Ethiopia as growing economy presents ample economic opportunities to both local and foreign investors. The rise of middle-class population, the spike in demand for better livelihood and abundant labor force also carry huge market potentials for business looking to make profits in a country that is blessed with natural resources including industries’ raw materials. Besides, the two decades of infrastructural improvements in the country also has made the country one of the leading destinations of foreign direct investments.
With over 12 industrial parks functional in the country, investors will have a 100 percent exemption from the payment of import customs duties and other taxes levied on imports, the country grants investors to import all investment capital goods such as plant machinery and equipment.
However, despite the headways, the country has been wallowing in the bottom list of ease of doing business. Obsolete commercial laws, labyrinth bureaucratic red tape, lack of modern other shortcoming in basic service provisions have stymied the growth of the sector. But thanks to the ongoing national reform, easing doing business is one of the areas that are receiving priority from the pertinent bodies. From commercial law to the investment proclamation, the country has amended and drafted new laws to improve investment climate and formalize online marketing by removing impeding legal frameworks.
The much-needed measures are expected to create favorable climate for business and investment in the country. So far, over 80 reforms have carried out so far been since the national reform began two years ago to ease business doing in the country. The reforms came as part of the “Ease of Doing Business” initiative launched by the Prime Minister Office aiming to simplify and streamline business activities in the country.
Ethiopian products and services destined for export are exempted from the payment of any export tax and other taxes levied on exports, while any income derived from an approved new manufacturing and agro-industry investment or investment made in agriculture shall be exempted from the payment of income tax.
Agro-processing, horticulture, tourism, ICT, textile and apparel, leather and leather product are among the strategic priorities identified by the government as potential areas of investment. Investors can invest in agro-manufacturing, mining and other sectors.
For investors to have full understanding of the investment and business environment in the country, Ethiopia’s embassies and missions abroad have to organize awareness creation platforms to acquaint foreign investors with the country’s potential.
Lately, the Ethiopian embassy in Rwanda has briefed Rwandan businessmen about Ethiopia’s investment potential. Such initiatives should be scaled up and expanded to other countries as well. And, when everything is said and done, Ethiopia could realize its vision of becoming amongst the top 100 countries on the World Bank’s Ease of Doing Report.
The Ethiopian Herald March 19/2021
