05 June 2014 Economic News Wrap


Investment Agency to Report Direct to the Prime Minister


–  New bill see the evolution of powerful investment board with composition not yet defined.


Fitsum Arega, director general of EIA.


The administration of Prime Minister Hailemariam Desalegn is soon to introduce a sweeping restructuring at the Ethiopian Investment Agency (EIA), hoping to transform it from a mere permit and licensing entity to a nucleus where the attraction of foreign direct investment (FDI) is directed, source disclosed to Fortune.

A bill has been tabled to Parliament last week, introducing amendments to the existing proclamation, which includes provisions that open industrial development zones to private investments. This has been an area that was exclusively given to the state or carried out in a joint venture with it.

The bill sees changes including the redrawing of the Agency’s governance structure from reporting to the Minister of Industry direct to the Prime Minister, these sources confirmed.

The flow of FDI to Ethiopia remains one of the lowest in the world, even when compared to Ghana and Kenya, as well as India’s six billion dollars and China, which had 10 times larger than India’s. And its share to the GDP is seen on a decline lately. At two percent, what Ethiopia gets from the inflow of foreign capital to its GDP was far less than China’s 3.9pc and Vietnam’s 5.7pc.

“It’s clear that there is an opportunity to improve the promotion of incoming foreign investment,” says a study carried out by the World Bank in 2012, surveying what impedes investment to Ethiopia.

One significant drawbacks is the federal agency entrusted with this task “has limited influence and autonomy in the investment promotion sphere, and there is limited coordination with regions,” according to a new study conducted by Monitor Deloitte, a subsidiary of Deloitte, one of the four largest global audit and consulting firms. Jointly commissioned by EIA and the Agricultural Transformation Agency (ATA), the firm has completed a 45-page study and presented it to the Prime Minister’s Office few weeks ago.

Many of the changes soon to come to the Agency led by Fitsum Arega, a young technocrat who climbed the stairs of power, is advised by recommendations from this study, according to those involved in the process. The study is seen as an icebreaker to roll the changes at the Agency, although there was a desire to do that earlier, according to an aide in the Prime Minister’s Office.

With its designation changed from “authority” under the Proclamation enacted in 1996 to “agency” under the yet to be amended law, and to “Commission” under the proposed amendment, the governance structure of the investment agency is one of the changes under the bill.

In a return to the trend under the investment law that was repealed and replaced by the recent one eight years ago, the bill includes three organs that comprises the investment administration with the addition of investment board to the list under the proclamation to be amended.

Nonetheless, details on the board composition, its powers and duties as well as meeting procedures are not included. These were present in the repealed proclamation years back. It was the Prime Minister who was chairman of the board, a practice which will soon see a comeback.

“EIA is unable to influence or take key decisions in the investment process, and is perceived to lack autonomy,” finds the study by Monitor Deloitte.

The Agency is not currently, “visible or influential enough, and requires more authority and power,” according to the study. It is a federal agency, with an old and shabby headquarters on Africa Avenue (Bole Road), undermined by uncoordinated decentralisation of the duty to chase foreign capital for the realisation of the nation’s potentials, the study finds. Besieged by poor logistics that limited its staff provide in-house services, the investment process at the Agency is not “sufficiently transparent and efficient.” Many of its 250 staffs are “lacking skill and expertise,” while they are paid an amount Monitor Deloitte finds “too low.”

“Employees have limited knowledge on the government’s policies, economic and sector priorities and the overall strategy of the Agency,” says the confidential study.

Neither has the Agency equipped with information technology infrastructure, which the study sees will take it more than a year to acquire.

The study strongly recommends that the federal investment agency should be made, “more visible in the national architecture, and requires backing from the highest government office in Ethiopia to execute its mandates in other states.”

The Administration appears to have bought these recommendations. In a separate brief presented to MPs, alongside the bill, authors of the restructuring suggest that “monitoring and supporting to directly administer the development of the industrial zones through a board that shall be led by the Prime Minister will speed up” and attract industrial investments within a short period of time and increase the manufacturing of export goods.

The board will have the authority to write directives outlining the duties and rights of investors in these industrial zones. The bill has introduced a significant change from the existing proclamation, granting the board powers – such as granting of new or additional incentives other than what is provided under any previously existing regulation – which are currently assumed by the Council of Ministers, the highest executive organ in the federal government, also chaired by the Prime Minister.

Under the bill, the investment board can authorise the opening up of investment areas for foreign nationals, otherwise exclusively reserved for domestic investors. Members of the private sector and those in the academia have been calling for a progressive investment regime that allows opening of restricted areas and additions of incentives.

This is a move from a relatively stringent and strict investment regime to a discretionary investment regime, for experts in the area. A lecturer at the Addis Abeba University (AAU) in public finance and investment sees the existing investment regulation as restrictive and highly technical.

“It micro-manages the sectors,” he told Fortune. “Foreign investors have had to tip toe through these restrictions.”

However, if the proposed amendment is to be ratified and become part of the law, it will enable the regime to be flexible enough to treat individual investment issues separately in accordance with the nation’s policy priorities. Such an open ended power scheme should not be left without caution, the lecturer reckoned.

“Anything discretionary can also be arbitrary,” he told Fortune. “As good as it may get, the decision making process should be anchored around the fundamental policy objectives of the country.”

He sees the evolution of a board overloaded and become bogged down in entertaining large number of investors’ claims and appeals.

However, the bill tabled to Parliament tries to emulate the experiences of Rwanda, where the president has so much say, as in Malaysia and Nicaragua.



KKR Makes Maiden African Investment



Kohlberg Kravis Roberts has moved into, for it, uncharted territory with its first-ever investment in Africa.

The private-equity giant has taken a stake in Ethiopia’s Afriflora, which grows roses for sale in the European market. Nor is KKR alone: P.E. investment in sub-Saharan Africa jumped 43% last year, to US$1.6 billion.

KKR will invest about US$200 million from its European fund in Afriflora. The money will be used to increase the company’s size by two-thirds and to add some 5,000 employees. The farm’s founders, a Dutch family named Barnhoon, will continue to manage the operation and will remain investors in the company.

“We see Africa as a long-term attractive investment destination,” KKR’s head for the continent, Kayode Akinola, said. “The potential is astounding. But the work to get there is going to be considerable.”

KKR added Kayode from Helios Investment Partners last year. He will join Afriflora’s board, along with another KKR executive, Matteo Bozzo.



Minister of Agriculture visits Japan


Ethiopian Minister of Agriculture, Tefera Derbew, visited Japan from 27 to 31 May upon the invitation of the Government of Japan.

According to a statement the Embassy of Japan sent to WIC today Tefera was accompanied by Fitsum Arega, Director General of the Ethiopian Investment Agency (EIA).

During his visit, Tefera met with several, Ministers and high ranking Japanese government officials, such as the Minister and the Senior Vice Minister of Agriculture, Forestry, and Fisheries, the Vice Minister of the Ministry of Foreign Affairs, the President of the Japan International Cooperation Agency (JICA), and the Executive Vice President of the Japan External Trade Organization (JETRO).

The main event during his visit was the Agro-Business Seminar and B2B Session on 29 May, which was co-organized by JETRO and the Embassy of Ethiopia in Japan.

More than 200 participants from related Ministries, private companies, business people, and Development Partners attended the Seminar. Tefera made a keynote speech at the Seminar, and also chaired one of B2B sessions.

The agenda included food value chains in Ethiopia, Trade and Investment potential in the Agriculture and Agro-Processing Sectors in Ethiopia, the status of private sector investment and future trends in Ethiopia, and B2B meetings.

Tefera also visited the suburbs of Tokyo to see Japanese style suburban farming, and made several visits to various agricultural laboratories, such as the National Agriculture and Food Research (NARO) center and the Japan International Research Center for Agricultural Sciences (JIRCAS).

Tefera, expressing his appreciation for the invitation from the Government of Japan, concluded that this visit was meaningful and successful for both countries, and that each program during this visit would further strengthen the bilateral economic relations between Ethiopia and Japan, through the enhancement of Agricultural relations. He also expressed his gratitude to the Japanese companies that showed interest in doing business in Ethiopia.



Ethiopian, Japanese Companies Agree for Joint Venture


Participants of the recent Ethio-Japan Agro Business Seminar held in Tokyo agreed for joint ventures in food and agro business areas, the Ministry of Foreign Affairs said.

Over 115 Japanese and Ethiopian companies engaged in agro business, flower and sesame production took part in the seminar, a press release the Ministry sent to ENA said.

Agriculture Minister Tefera Derbew said on the occasion that trade relation between Ethiopia and Japan is not as such strong.

But Ethiopia’s export of agricultural products to that country is showing progress over the past few years.

Japan is among the major development partners of Ethiopia, said Ethiopian Ambassador to Japan, Markos Tekle. The development endeavors supported by JICA demonstrated this fact.

The seminar helps to strength relation between companies of the two countries in food and agro business areas, he said.



US-backed scheme lines up investors for African energy projects


Plans to encourage more than $1 billion in investments for innovative energy infrastructure projects in sub-Saharan Africa have been announced by US energy secretary Ernest Moniz.05 Jun 2014

Moniz told a two-day ministerial-level meeting to discuss energy and business opportunities in Ethiopia which 27 private sector investors and organisations had already committed to developing, including “off-grid and small scale” energy projects under the ‘Beyond the Grid’ scheme.

Moniz said the scheme will “exceed” commitments to provide 20 million businesses and homes with access to electricity which were made under the existing ‘Power Africa’ initiative, launched by US president Barack Obama in South Africa last year.

Over an initial five year period the new scheme is designed to make it easier to acquire financial and technical assistance, which Moniz said was “historically not available to small energy businesses”. According to Moniz, the scheme “will incorporate new financial tools, such as investment structures that blend donor and private capital, aggregating and de-risking small energy projects in Africa and making them available as a new asset class for investment at scale”.

Moniz said: “With close to 600 million people without access to modern-day electricity, it is clear that centralised grid access is not a comprehensive solution for these countries in one of the world’s least urban continents. But through solutions including off-grid and small scale energy projects, we can bring electricity to these rural areas.”

In support of Beyond the Grid, the US African Development Foundation, GE Africa and the United States Agency for International Development have announced that they will jointly award up to $1.8 million in grant funding over the coming months to “African-managed and –owned enterprises with renewable energy solutions”.

According to the US energy department (DOE), Power Africa “has already helped close almost 2,800 megawatts (MW) worth of transactions and has secured commitments for another 5,000 MW”. The DOE said this represented nearly 75% of the initial goal of developing projects to make an additional 10,000 MW of “cleaner, more reliable energy” available in Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania. To date, Power Africa has attracted investments of more than $15bn from the private sector for new projects in sub-Saharan Africa including “mini” electricity generating plants, the DOE said.

The US government has been stepping up efforts to increase trade with Africa and encourage US firms and institutions to invest in the continent’s infrastructure.

The chairman and president of the Export-Import Bank of the US, Fred Hochberg, joined Moniz at this week’s Ethiopia conference. Hochberg said the bank intends to be a “full partner” in Africa. Earlier this year, the bank announced the appointment of 11 members to its 2014 sub-Saharan Africa advisory committee, to advise on the development and implementation of policies and programmes to support the bank’s activities in the region and boost US exports.

Last month, US commerce secretary Penny Pritzker concluded a trade mission to Africa to increase bilateral trade and investment in the energy sectors of Ghana, Nigeria and Ethiopia. Twenty US businesses took part in the DOC trade mission, which focused on investment opportunities in the energy sector.

The International Monetary Fund’s (IMF) Regional Economic Outlook for Sub Saharan Africa, released last April, said economic activity in the region continued to be underpinned by large investments in infrastructure, mining and maturing investments.

However, the report said: “Pervasive energy subsidies have discouraged investment and maintenance in the energy sector in many countries in sub-Saharan Africa, leading to costly and inadequate energy supply that is increasingly a bottleneck for economic growth.” The report also called on countries in the region to reform energy subsidies, which it said “discourage investment in the energy sector”.



Private Sector Involvement on the Spot Light During Ministerial Meeting


The US-Africa Ministerial Meeting focused on issues of private sector involvement, new approach for rural electrification, energy efficiency and how to continue working with Obama Power Initiative.

During a joint press conference Alemayehu Tegenu, Water, Irrigation and Energy Minister, said the Ethiopian government has highly benefited from hosting the meeting and further commented it was successful.

Alemayehu also spoke of the issues that were discussed during the meeting. He said discussions were made on the issues of private sectors’ participation, new approach for rural electrification and energy efficiency.

According to the Minister, participants of the meeting assessed and explored with US Secretary of Energy, Ernest Moniz, on how to continue working with Obama Power Initiative. He added, “Totally, I can say the objective of our conference is fully completed in a very successful way”.

On his part Moniz said, “We were very pleased that the collaboration was excellent. The meeting was extraordinarily successful. The Prime Minister’s presentation emphasizes the risks in Africa from climate change were well spoken”.

The meeting stressed on the tremendous resources in Africa- renewable resources, natural gas being developed strongly and oil as well.

Moniz further noted the issue of climate was well discussed for Africa’s clean energy resource should be developed.



U.S. Works With Ethiopia on Renewable Energy


United States of America has disclosed that it wants to work on renewable energy production in cooperation with Ethiopia.

The country’s Energy Secretary, Ernest Moniz talking to Premier Hailemariam Desalegn in Addis Ababa, at AU Headquarters said that Ethiopia will be exemplary to Africa allowing the private sector to participate in renewable energy production.

He also expressed that Ethiopia has performed successfully on development projects carried out in cooperation with the United States.

Moniz said United States will continue working in providing finance which is the impediment for the private sector’s participation in renewable energy production.

Prime Minister Hailemariam Desalegn expressed that Ethiopia still needs the support of United States on rural electrification, capacity building and integrated infrastructure development.

Ethiopia has the capacity to generate 37 thousand megawatts of energy from water, wind, solar and geothermal sources by 2037.



Import Solution as Malt Factory Faces Barley Shortage


–  The rapid growth of Ethiopia’s beer industry has led to the increased demand for malt


The newly expanded Assela malt factory, which is having a hard time getting malt barley from local sources, is turning its eyes towards the international market.



The Assela Malt Factory’s investment of 300 million Br, intended to halt the import of malt, has ironically forced its management to import 260,000qls of barely at an estimated cost of 272.5 million Br, Fortune learnt.

Located on the outskirts of Assela town in the Arsi Zone, Tiya Woreda of the Oromia Region, the factory assumed that it would get its inputs from the surrounding areas, famed for their barley production.

However, the contemplated amount of barely supply in the expansion project is not flowing all year round. This has presented the Company with the risk of running out of stock in two months time.

“The domestic supply has basically stopped, yet the factory needs 40,000qls of malt barley every month to continue production,” said Amare Wakjira, managing director of the Assela Malt Factory. “We need to have a secured channel of supply; otherwise the situation is not sustainable.”

The factory normally gets more than 90pc of its domestic barley inputs through traders who collect the crop from smallholder farmers in the Arsi zone of Oromia Regional State and the Sidama zone in the Southern Regional State. Nonetheless, the factory tries to encourage farmers’ cooperatives and unions to supply it directly, according to its strategic plan.

But the domestic supply has not proven to be reliable, especially in recent years. Consequently, the factory has imported barley in the past, most recently last year.

Even though the extraction amount of imported barley is better, the locally produced barley also has its own merits in terms of better taste, experts in the industry agree.

The Company currently buys a quintal of local malt barley at a cost of 900 Br to 1,050 Br, depending on the quality of the product. Whereas, the management plans to import barley from abroad at around 1,048 Br a quintal, including transportation costs up to the factory gate, Amare said.

Officials from the Agricultural Bureau of Oromia Region have various reasons for the shortage of malt barley, according to him.

“They believe that there is a hoarded harvest by the farmers and we are looking into this possibility with them,” the manger told Fortune.

If the supposedly hoarded product does not materialise, the management has decided to order the import of around 260,000qls of barley, which will see it through until the next harvest season in January. But this will go ahead after the approval of the board of directors of the Company, which is expected to happen within a month.

The Malt Factory needs more than 600,000qls of raw malt barley to produce 360,000qls of malt in a year.

“If we didn’t import the barley and produce malt, the beer factories would import the malt directly, with which they are covering more than 60pc of their demand already,” the manager of the factory, which employs about 260 workers, noted.

According to data from the Ethiopian Revenue & Customs Authority (ERCA), 5,425tn of malt was imported in 2003 at a cost of 2.8 million dollars. This number had grown more than 15 fold by last year, forcing the country to spend 47.3 million dollars on the import of malt.

Established 30 years ago, the factory has been the sole supplier of malt to the local beer industry, the production capacity of which has reached about four million hectolitres. This, in turn, has raised the demand for malt by the industry to 99,540tns, in 2011/12.

This was before the coming of the Gondar Malt Factory of the Tiret Endowment Investment Organizstions (TEIO). Established with an investment of 670 million Br, in Gondar, in the Amhara Regional State, the factory has a production capacity of 16,200tns of malt a year. Close to three quarters of its produce is for its  sister company, Dashen Brewery.

There are five companies, namely – BGI Ethiopia, Harer Brewery Share Company, Bedele Brewery Share Company, Meta Brewery Factory and Beer Garden – that buy malt from the factory.

Assela Malt Factory sold close to 220 quintals of malt worth 345 million Birr to these five companies in 2011/12. BGI Ethiopia, producer of Saint George beer, was the main buyer, taking 56pc of the total sales in 2011/12.

Barley is the fifth most important cereal crop in the country after maize, wheat, teff and sorghum, and it is produced on about one million hectares of land. Of the total barley production of 1.7 million tonnes in 2010/11, Arsi and Bale contributed close to 20pc.

Yet, this has not resulted in a sustainable supply of barley to the malt factory in the locality. Nega Wubeneh, senior director of Value Chain Programs at the Agricultural Transformation Agency (ATA), criticises the uncoordinated value chain in crop production for this.

There are also farming differences between wheat and barley on the level fields of the Arsi and Bale lands, according to Nega.

Since the production of wheat is more economically reasonable, with higher yields in amount and price, farmers prefer to plant wheat. Therefore, high yielding malt barley seeds must be distributed and buyers should give a better price for the farmers with future market if possible, to change the trend.

There are at least two projects that have been initiated by two international brands operating in the country to help solve the malt barley shortages.

Deageo – owner of the Meta breweries and Heineken breweries, which acquired the Harar and Bedele beer factories – have started production improvement programs of malt barley on small holder farms in tthe Sebeta and Arsi areas of the Oromia Regional State. This has been done in collaboration with the Ministry of Agriculture and the ATA over the last two years, even though the results are not enough to satisfy the factory’s demand.



HPR Ratifies Loan Agreements


HPR Ratifies Loan Agreements

The House of Peoples Representatives (HPR) ratified on Thursday (June 5) three draft bills.

The HPR , in its 36th regular meeting, endorsed the 50-million-Euro loan agreement between Ethiopia and France. The loan would be used for the implementing the project for installation of high electric power transmission lines.

The agreement, besides enhancing the social and economic development of the country by significantly increasing electric power  qualitatively and quantitatively, will hugely contribute toward achieving the power expansion and distribution goal of the Growth and Transformation Plan.

Furthermore, it would remarkably boost power supply to industrial areas and enable villages without power supply to access electricity.

The House also ratified over 20-million-Euro loan agreement for the execution of the dry waste disposal project of Addis Ababa city.

The agreement signed between Ethiopia and France would enable to construct dry waste disposal area for the city. The loan agreement will help move the over 50-year-old disposal site from Qoshe-Repi.

Similarly, the HPR approved the 208.5-million-USD loan agreement between Ethiopia and the International Development Association.

The loan would improve the program in road sector and support the organizational structure of the sector, it was indicated.

All the loan agreements were ratified after the House checked that they are consistent with the loan strategy of the country.


Norway Extends 17.4 million USD to Ethiopia


Norway Extends 17.4 mln USD to Ethiopia

The government of Norway yesterday donated over 17.4 million USD to Ethiopia through UNICEF and UNFPA to support the adolescent and youth development program.

Norwegian Ambassador to Ethiopia Odd-Inge Kvalheim signed the agreement with representatives of UNICEF and UNFPA.

The finance is aimed to fund the second phase of the program being implemented by the government of Ethiopia and the two partners.

Over 400,000 at risk adolescents and youth between the age of 10-24 will be benefitted from the four year program being carried out in 30 selected woredas of Addis Ababa and five regional states, namely Amhara, Oromia, Tigray, Afar and South Ethiopia.

The Norwegian government extends this fund seeing the encouraging results gained from the implementation of the first phase of the program, said the Ambassador.

Director of the Federal HIV/AIDS Prevention and Control Bureau Birhanu Feyssa on his part said the fund will help to reduce vulnerability of at risk youth and adolescents for new infections.

UNICEF Representative for Ethiopia Peter Salama said Ethiopia has managed to reduce prevalence of new HIV infections to 1.3 percent, which he said is encouraging.


Garment Growth With Middle Eastern Company’s $80m Deal


–  With sector performance little over a half of GTP targets, continued growth is crucial


Velocity Apparel Plc – a Middle East based Textile Company with factories in Egypt, the UAE and Jordan –  is due to establish an integrated garment factory in Mekelle town, with a total cost of 80 million dollars.

Upon joining the growing textile sector of the country, the Company has been granted a loan amounting to a quarter of its establishment cost, by the Development Bank of Ethiopia (DBE).

The Company, which has already secured 100ha of land in Mekelle, the capital of the Tigray region, 780km north of Addis Abeba, in order to erect its factory, is expected to commence construction in a few months, according to Taddese Haile, state minister at the Ministry of Industry (MoI).

Delegates of the Company, which supplies its products to renowned international stores like Target, Gap and Wal-Mart, were in town last week for final talks with government officials from the Ministry and the Ethiopian Textile Industry Development Institute (ETIDI).

The construction of the integrated garment factory is planned to be undertaken in three phases. The first phase of construction, which will be dedicated to garment production, is expected to be finalised a year after its commencement. The finalisation of this phase will cost the Company 30 million dollars.

Established in 1990 with a turnover of 100 million dollars in 2013, the company secured the loan from the DBE two weeks ago. To secure the loan, it has provided the Bank with the necessary documents, including the 30pc equity from the total investment cost of the first phase of the project, Sileshi Lemma, director general of ETIDI, told Fortune.

The Company, which will export almost all of its products to its already established markets, has requested a bonded warehouse customs duty service when it becomes operational.

The government has accepted the request in principle, according to sources.

Ten new factories with a combined production capacity of 100tns a day are also expected to start production during this fiscal year. An additional three new projects are expected to start production by 2014/15, according to Sileshi. This is in addition to six ongoing expansion projects in the textile industry.

Among these, the most recent to join the sector wass SVP Textiles Plc, from India.

The Company have started the construction of a 10-billion Br textile plant on a 50ha plot within the Kombolcha Industrial Zone, in Kombolcha town of the Amhara regional state, this year.

Despite all this development, the industry that now comprises of 115 textile factories and 40,000 workers, was only able to earn 52pc of the 111 million dollars that it was supposed to achieve in the first half of the year, according to the Institute. The target for the year is set at 317 million dollars.

The underutilised capacity of existing factories is still a big problem in the industry, according to an expert, who talked to Fortune on condition of anonymity. Factories in the textile sector are currently only utilising around 60pc of their production capacity, he said.

Around 99 million dollars worth of textile products were exported in the last fiscal year. This number is expected to reach one billion dollars by the end of the Growth & Transformation Plan (GTP) period, which is only one year away.

With a per capita fiber consumption of roughly one kilogram – far below the world average of 8.7 kg and the African average of 3.2kg – the country has great potential, which needs to be used properly, according to a research conducted by the African Growth & Opportunity Act (AGOA), three years ago.



Samsung’s First Printer Assembly in Africa Inaugurated


Last Monday witnessed Tana Communication Plc and Samsung Electronics East Africa inaugurating Samsung’s first printer assembly plant in Africa.

During the inaugural ceremony Tana’s CEO, Sium Adugna, said that in addition to creating job opportunities the plant will facilitate Ethiopia’s efforts in knowledge and technology transfer.

Sium further noted the establishment of the plant will minimize the production of printers which in turn will make Samsung printers competitive in Ethiopia.

Through his representative Robert Nigeru, Iso Samsung Vice President, said the opening of the plant is a sign for Samsung’s commitment to build Africa’s information and communication technologies capacity.

Robert further noted, his company will bring printer assembly engineers from Korea in order to equip local talent with necessary skills for running the assembly.

The products of the assembly are the first printer models of ML-2160, SCX- 3405W, ML5015ND and SL-M3820D which are Mono and Multi function printers.

Currently the plant has the capacity of assembling 70 printers per day.



Ethio-South African Business Forum Opens in Addis


A three day Ethio-South Africa Investment and Business Forum opened June 01 in Addis Ababa with representatives of over 25 South African companies involved in education, health, infrastructure, manufacturing and agro-processing taking part in the discussions on possible cooperation in trade and investment.

In his welcoming address, Endalkachew Simie, Deputy Secretary General of Ethiopian Chamber of Commerce and Sectorial Association, noted that Ethiopia and South Africa had a longstanding bilateral relationship which has been strengthened by bilateral agreements in different areas including education, tourism and agriculture. In addition, he noted, imports and exports between the two countries have been growing in value and in volume.

Endalkachew said the Forum would contribute towards increasing existing economic ties between the two countries.

Stanley Subramoney, Chairman of the NEPAD Business Foundation, said Africa was at a critical juncture and the continent currently provided a new edge of opportunities. He noted that intra-Africa trade was increasing and pushing back the frontiers of poverty.

Ethiopia’s Agriculture Minister, Tefera Deribew, stressed the Forum could help elevate existing Ethio-South Africa social, economic, and political relations to a higher level through fostering strategic economic alliances and solid business partnerships.

He underlined the Ethiopian government’s commitment to make the country a real destination for Foreign Direct Investment, emphasizing that the country enjoyed a conducive business environment, political stability, sound economic policies, and macro-economic stability.

Fistsum Arega, Director General of the Ethiopian Investment Agency also noted the government’s full support and the incentives available for investment in the priority sectors. He South African businesses to make use of Ethiopia’s quota-free and duty-free access to European and other markets.




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