Investment Opportunities
Priority Sectors
Ethiopia has a vast agronomically favourable land, conducive climate, water and land resources which made it an incredible hub for investing in agriculture. From the total land 74.3 million hectare is suitable for agriculture. And there are eighteen identified major agro-ecological zones, making us suitable for diverse agricultural investment opportunities.
Ethiopia’s competitive wage rates and large industrial workforce have also boosted our capacity in light manufacturing―including textile, apparel, and leather products―enabling us to become a strategic partner in global value chains
Ethiopia has a vast mineral potential and Mining is Ethiopia´s fastest-growing economic sector which posted a 115% growth rate in 2021 and 91% in 2020, which translated into a five-fold increase of the sector´s contribution to GDP and it is projected to grow by 33% annually, becoming a backbone of agriculture and a catalyst for industrial growth, job creation and export earnings.
Ethiopia is the most attractive investment destinations for establishing ICT based businesses. Having the largest workforce in Africa and a digital-focused education system has created a growing, competitive, tech-savvy and English-proficient local talent pool. Our 200-hectare ICT-dedicated industrial park in Addis Ababa, with all necessary infrastructure and services, provides investors with a ‘plug and play’ opportunity.
Ethiopia offers investments opportunities in building tourism infrastructure (including hotels and resorts, convention centres, duty-free centres, cultural villages and centres) and the development of selected destinations.
Other Sectors
Despite the massive work in electricity production there is still a huge and growing demand in the sector and in order to address demand, the government plans to significantly expand installed capacity. According to the 10-year Development Plan, the government, in close collaboration with the private sector, plans to grow the installed power generation capacity from 4,500 megawatts to 19,900 megawatts by 2030—while diversifying the power generation mix and building a more climate-resilient power system.
Ethiopia has over 28,000 healthcare providers, yet this falls short for its expanding population. At the tertiary healthcare level, only 364 hospitals exist, with a mere 17% being private. This underscores a substantial gap for private healthcare operators, particularly in meeting the needs of the growing middle class. Additionally, the majority (85%) of private hospitals are concentrated in Addis Ababa, presenting a significant opportunity for healthcare providers in the country’s interior.
There is also a huge gap in pharmaceutical supplies where Imports account for 65% to 75% of the Ethiopian out of which 22 % is primarily sourced from India.
To support increasing trade and make Ethiopia a hub for regional trade, we have embarked on an ambitious journey to build transport and logistics infrastructure and improve services. Investors are invited to engage in BUILDING LOGISTICS Infrastructure, provide logistics services and build port connecting transport infrastructure.
Emerging Sectors
I. Telecom
As part of its Home-Grown Economic Reform Agenda and with the drive to foster Ethiopia’s economic growth through improved digitalization, the Government of Ethiopia announced in 2018 its decision to open the telecom sector to competition, aiming to attract private sector investment and operational expertise to improve the accessibility and quality of telecommunications services. In 2019, we embarked on a strategy to ignite our digital economy and provide more homes and businesses with access to reliable high-speed telecom services, extend coverage and introduce world-class management and cutting-edge technology.
Through an international competitive selection process, the Ethiopian Communication Authority (ECA) awarded one 15-year full-service telecommunications operation license in May 2021 to the Global Partnership Ethiopia consortium formed by Safaricom (Kenya), Vodafone Group (UK), Vodacom Group (South Africa), CDC Group (UK), and Sumitomo Corporation (Japan). The upfront fee of $850 million was paid by GPE and the license was executed the same month. Over the next decade, the private operator, now named Safaricom Telecommunications Ethiopia, is expected to invest $8 billion dollars in the country’s telecoms network in the largest ever single foreign direct investment in Ethiopia. Safaricom Telecommunications Ethiopia’s services were launched in October 2022.
We are now looking for the third telecom operator in Ethiopia. The ECA has issued a request for proposal for global telecom operators to join our growing market in 2023. In addition, a bid to privatize and offer 40% ownership of Ethio Telecom, the largest telecom operator in East Africa in number of subscribers, is in the making.
II. Financial Services
Until recently, our financial sector has been closed to foreign investors. However, in the last quarter of 2022, we have approved a bill to open up the banking sector in Ethiopia for foreign competition. Foreign investors can now enter the Ethiopian market and establish their own banks or work in partnership with an existing bank.
III. Privatization of State-owned Enterprises
To push our economic reform agenda further and unleash the potential of the private sector, the Government of Ethiopia is offering to sell a host of state-owned enterprises, either partially or entirely. These includes state-monopolies in airline, logistics, telecom and energy. Several businesses engaged in sugar production, tourism and hospitality and cement production are expected to be privatized in the short term. Foreign investors are encouraged to explore these opportunities and tap into an existing operation, an existing market and the potential to upgrade and expand production of highly demanded products.
Explore the dynamic economic landscape, demographic strength, and global collaborations for a rewarding investment platform. Seize the opportunity to unlock Ethiopia’s full potential. The gateway to Africa’s prosperity awaits your strategic investment in our journey towards prosperity!
