BY TEWODROS KASSA
Chinese investment is one of the largest in Ethiopia. Currently, the two countries are enjoying long-standing relations and multilateral cooperation. The Ethio-Chinese relations were established in 1970. The 50th anniversary of the establishment of diplomatic relations between China and Ethiopia was marked last year. Diplomatic relations of the two countries are carried out at Ambassadors’ level situated in their respective capital cities of Addis Ababa and Beijing.
These relations between the two nations are cemented by economic ties. Their annual bilateral trade has grown to 5.4 billion USD and by 2016-2018; Chinese Foreign Direct Investment (FDI) in Ethiopia had reached 4 billion USD.
Currently, Chinese investors are largely joining investment here following the Ethiopian government’s various investment incentives to multinational investors. The incentives include capital incentives, industrial raw material supply, tax holiday as well as effective transportation service provisions via the Ethiopian cargo.
Different Chinese and other countries’ investors witnessed that Ethiopia’s strategic location, its relatively stable political and economic environment, commitment to the African Continental Free Trade Area (AfCFTA), largest domestic market in Africa; among others enable the country to become the major investment magnet in Africa.
L and H Building Materials PLC Director Kevin Ma told The Ethiopian Herald that Ethiopia is an ideal destination for multinational investors. The Ethiopian government has allowed him to import machines and other manufacturing materials duty free while joining investment here, he added.
“Ethiopia is a historical country with over three thousand years of diversified and fascinating culture. I have been here for more than five years. I found it very attractive and the people are very hospitable. The way they interact makes me to be familiar with everything almost within two years. I like Habesha food. Ethiopian raw meat is very delicious and somehow similar to Chinese food. My chef cooks Habesha food for me in my home. Even I try to cook Habesha food,” he underscored.
As to him, he preferred and decided to invest in Ethiopia after identifying that the country’s economy is booming being one of the largest Gross Domestic Product (GDP) annually for almost ten years. His second reason is every time as he lands at Bole International Airport he looks at new buildings coming up. This demonstrates that the country’s economic growth is healthy and proved that the country is one of the proper destinations for running business activities successfully. The availability of competitive human power with comparable cost is the other reason that prompted him to launch business in Ethiopia, he stated.
He said that L and H Building Materials PLC commenced productions in 2018. The company installed the international leading equipment and employed experienced Chinese engineers to train the local staffs in Ethiopia. It produces iron madeVictor Door and Five Stars Elevators. Currently, its products have already penetrated the Ethiopian and East African markets. It has been producing well designed doors and elevators for the past five years in its factory located inside the Eastern Industry Zone in Dukem town. The company has now built customers trust in the country through availing guaranteed products with affordable price. The company makes Ethiopia as its centre to the African market and export its products to the neighbouring East African countries. Kenya, Sudan, and Eritrea are among the leading destinations of its products being made in Ethiopia.
As to him, most Chinese investors are largely attracted by the blossoming Ethiopian market. The country’s strategic location to the African market, availability of well trained and industrious human power, untapped resources, among others give favours to Chinese investment in Ethiopia.
In addition, as the construction sector is booming in Ethiopia, there is a potential market demand for standardized doors and elevators. However, the emergence of the COVID-19 pandemic has affected the company’s business activities as affecting other businesses globally. L and H Building Materials PLC struggle with the pandemic relying on the availability of potential market in the country, he remarked.
The director further said that his company is working day and night to deliver outstanding products and meet the growing market demand of customers’ for standardized construction inputs. It produces fire resistant and bullet proof iron security doors to meet the booming construction sector demand in Ethiopia with affordable price. Depending on its size and raw material used one victor door is available in the market with 9,000 up to 11,000 Birr. The company firmly follows pro-environment production process and contributes to environmental protection through largely consuming iron as an input to its products.
Currently, the company created more than 150 permanent job opportunities to Ethiopians in marketing, management, and logistics, among others. In addition, the company gives job opportunities for more than 300 Ethiopians working in the elevators and victor door productions. The company continues contributing its part by bringing latest sector technologies to Ethiopia and by providing multidimensional training opportunities to Ethiopian professionals. He also aspires to expand his business and employ more Ethiopians in the near future.
He recommended that Ethiopia can develop quickly without other country’s interference. China never interferes in any country’s political affairs. China should continue supporting the on-going economic reforms in Ethiopia and promote the two countries’ relations to a better step. “We are like a family. There are some similarities between the way we dance and celebrate as well as there are astrong family ties among Chinese and Ethiopians. Apart from religion we do not have that much difference.Therefore, China and Ethiopia will continue a strategic business partners,” he opined.
According to the United Nations Conference on Trade and Development (UNCTAD) Report 2020, China has remained the largest Foreign Direct Investment (FDI) source in Ethiopia, accounting for about 60 percent of the newly approved foreign projects in the East African country during 2019.
THE ETHIOPIAN HERALD JULY 28/2021
