Transcript Ethiopia at a glance

Business Opportunities in
Ethiopia
Prague,
August 2016
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Ethiopia at a glance
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 Ethiopia is one of the largest
countries in the world and it is
fourteen fold of Czech
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Addis Ababa, Ethiopia: Africa’s Diplomatic Capital,
and third biggest center of diplomatic hub in the world
City
Number of
Diplomatic
Missions
Brussels
185
Washington D.C
176
Addis Ababa
118
African Union Headquarter
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Ethiopia is the second most populous
country in Africa
Population in million
Source: world meters
200
180
160
140
120
100
80
60
40
20
0
187
102
93
81
Nigeria Ethiopia Egypt Germany
65
65
U.K
France
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Ethiopia is the Cradle of Mankind
Lucy, 3.5 million years old, and the recent discovery Ramides, 4.4
million years old hominid fossil are discovered in the country
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Ethiopia is the #1 Coffee exporter in Africa
Top 10 Coffee exporting
countries
Source: world atlas
1.
Brazil
2.
Vietnam
3.
Indonesia
4.
Colombia
5.
Ethiopia
6.
Peru
7.
India
8.
Honduras
9.
Mexico
10.
Guatemala
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ETHIOPIA IS ELECTED AS WORLD BEST TOURIST
DESTINATION IN 2015 by European Council on Tourism
and Trade (ECTT)
ETHIOPIA : THE
PERFECT CULTURAL
DESTINATION; THE
LAND CHOSEN BY
GOD !
(Report presented by the president)
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Ethiopia has the biggest and most profitable
airline in Africa
Ethiopian Airlines profits
$175 million in 2014/15 fiscal
year which is more than
what the rest of Africa’s
airline industry posted over
the same period
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Ethiopia is the biggest merchant ship
owner/operator in Africa
Ethiopian Shipping Lines (ESLSC) has 14 ships it fully owns and operates,
which ranks it as the biggest fully African owned company of its kind.
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Ethiopia is the largest flower exporting
company in the world
 Ethiopia is the second largest flower
exporter in Africa
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Ethiopia: Home to the largest hydro electric
power dam in Africa
The dam will be the largest
hydroelectric Power plant in
Africa when completed, and the
eighth largest in the world, by
producing 6,000 MW
The dam is expected to begin power
generation at the end of this year.
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Why invest in Ethiopia?
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Political
and Macro
Economic
Stability
Competiti
ve
Incentive
Package
Operating
Environm
ent
Market
Access
Why
invest in
Ethiopia?
Huge
Untapped
Resources
Demograp
hic
Advantage
Infrastruct
ure
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Political and Macro Economic Stability
• Ethiopia is politically stable and also contributing a lot in
stabilizing other neighbor Countries
• Stable macroeconomic and rapidly growing economy
• Successfully achieved the first Growth and transformation
plan (GTP1) and started implementation of the second GTP
(GTP2) in which the country is expected to transform from
Agricultural led Economy to Industrialization
• Ethiopia achieved most of the Millennium Development goals
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Ethiopia is one of the world’s fastest growing economies
Annual GDP Growth (%) forcast
GDP Growth
15
10
5
0
2005 2006 2007 2008 2009 2011 2012 2013 2014 2015 2016 2017
Year
Ethiopia
Sub Saharan Africa (Developing only)
Low income Countries
Source: World Bank
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Ethiopia’s GDP growth is greater than
comparative African Countries
GDP Growth Forcast
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10
8
6
4
2
0
2011
2012
Ethiopia
Kenya
2013
Nigeria
Source: World Bank
2014e
2015f
South Africa
2016f
Tanzania
2017f
Uganda
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Source: World Bank
Ethiopia: One of the top FDI destination in Africa
• In 2014, Ethiopia is the 8th-largest
recipient of FDI projects in Africa,
(EY’s attractiveness survey Africa 2015)
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Ethiopia’s FDI is increasing Rapidly
Ethiopia FDI inflows from 2008 to 2014
China
India
Saudi Arabia
Turkey
UK
Netherlands
Millions of dollars
• Top investors:
1 400.0
1 200.0
1 000.0
800.0
600.0
400.0
200.0
2008
2009
2010
2011
2013
2014
Year
Source: UNCTAD
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Access to Wide Market
Large domestic Market (About 100 million people)
COMESA (Common market for Eastern and Southern Africa)
 19 member countries
 Over 400 million people
AGOA (African Growth and Opportunities Act) and GSP
(Generalized System of Preference) of the United States
Government initiative, and
EBA (Everything But Arms) Agreement of the European Union
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Ethiopia’s Demographics Advantages –
Large Young Population
Source: CIA World factbook
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Labor
• Ethiopia has one of the lowest manufacturing labor
costs in the world - hourly manufacturing labor
costs about $0.45
• Abundant and trainable labor force
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Infrastructure
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Ethiopia has a steadily improving surface
transportation infrastructure
Road
Railway
It is planned to Construct about 5000 km Railway line and most of
them are under construction. These lines connects the national
regions to the center and upgrades the connections with Djibouti
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Air Transport
• Ethiopian airlines has the
Largest cargo fleet in Africa
• Ethiopian Shipping Lines
rapidly expanded its fleet
and is the owner of 9
modern ships which is
acquired in the past few
years
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Power
Ethiopia would become the 2nd largest exporter
of electricity in Africa by 2023
Ethiopia has one of the world’s cheapest
electricity prices (Textile factories pay between US$0.002 and US$0.78 per Kw)
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Industry Zone Development by Government
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Industry Zone ….
•
•
•
•
•
Bole-Lemi has a total of 342 hectares (Addis Ababa )
Kilinto: 308 hectares under Master plan and design
preparation stage (Addis Ababa )
Dire-Dawa: 1050 hectares, Multi-purpose
Combolcha: 1123 hectares – Investors need
assessment in progress.
Hawassa: 270 hectares - Agro-based industries
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Education
• Ethiopia has near universal access to primary education &
provides increasingly more opportunities to higher learning
• There were only 2 public universities 15 years ago; today there are 31.
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Operating environment
• Ethiopia ranks higher than comparative African countries in
the World Bank’s ease of doing business report for 2014
• A high ease of doing business ranking indicates the
regulatory environment is more conducive to the starting
and operation of a local firm.
Source of Data: World Bank
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Income Tax
Holiday For
priority sectors
Competitive
Incentive package
Provision of
Land at
Competitive
lease price
Loss carry
Forward
Significant
Incentive
Packages
Customs Duty
Exemption for
capital goods
Remittance of
Capital
Duty exemption
on raw materials
used as inputs
for Export
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Major Investment
Opportunities in
Ethiopia
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Major Investment
Opportunities in Ethiopia
• Agriculture
• Manufacturing
 Agro processing
 Textile and Apparel
 Leather and Leather Processing
 Chemical and Pharmaceutical
Metal and Engineering
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1. Agriculture
 Resources and Suitable conditions for Agriculture
• 74.3 million hectares of land suitable for agriculture, out
of which only about 18 million hectares are currently
utilized
• 51.3 million hectares of arable land (45% of total land
area)
• 10 million hectares of irrigable land (only 3% utilized)
• 18 major agro-ecological zones and 49 agro-ecological sub
zones
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Agriculture cont.…
Climate suitable for growing over 146 types of crops
Land is accessible through lease for time extends from 25 to 99
years
Lease payment/hectare depends on distance from center, Lower
starting from 111Birr/h (Approx. 4.8 €)
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Livestock Potential
Ethiopia is 1st in Africa and 10th in the world in animal
head counts ( 42 million heads of cattle, 25.5 million
heads of sheep, 24.4 million heads of goats, 53 million
chicken, 2.3 million camels, 7 Million equines)
It is currently exporting live animals and meat to the
Middle east and it is the most desired meat in Middle
East
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Agricultural Investment opportunities
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Food Crops
Beverage Crops
Horticulture
Cotton
Sugar cane plantation
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Livestock Farming
Apiculture
Aquaculture
Forestry and related
activities
Rubber and Palm tree
plantation
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Manufacturing
 Textile and Apparel
 Ethiopia grows the world’s finest cotton
 3 million hectares of land suitable for commercial
production.
Investment Opportunities
• Production of yarn, woven, knitted and
crocheted fabric
• Production of Textile Garment
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LEATHER AND LEATHER PROCESSING
• Ethiopia will be a leading exporter of high quality leather
products because of the availability of quality hides and skins.
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Investment Opportunities in Leather and
Leather Processing
• Leather Footwear and Garment
• Luggage, handbags and gloves
• Saddle and harness
• Integrated tanning and
Manufacturing
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 Pharmaceutical
• Ethiopian private
pharmaceutical market is
estimated to be worth between
400 and 500 million USD and
growing at an impressive rate
of 25 per cent per annum.
(Pharmaceutical Fund and Supply Agency (PFSA Ethiopia))
• There are approximately 200
importers of pharmaceutical
products in Ethiopia
Inv. Opp. in
Pharmaceuticals
•
•
Manufacturing of human
and Animal Medicine
Manufacturing of inputs
of basic pharmaceutical
products
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 Chemicals and Chemical products Industry
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Fertilizers and Nitrogen Compound
Caustic soda and soda ash
Soap and detergent
Paints, varnishes, writing and painting inks
Man-made fibers
Magnesium Chloride
Hydrogen peroxide
Coal phosphate
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 Paper and Paper Products Manufacturing
• Pulp, paper and paper packages
• Plastic and Plastic products
• Plastic products used as inputs for construction of
building, vehicles or other industrial products
• Plastic pipes or tubes
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 Non-metallic Mineral products Industry
• Glass and Glass Products
• Ceramics
 Building materials
• Manufacture of: Lime
 Gypsum
 Marble
 Granite
 Limestone
 Wall cladding and roofing tiles (not from cement)
 Tubes
 Pipes and
 Fittings
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Agro processing
 Processing of Meat products
 Processing of Fruits and
Vegetables
 Integrated dairy farm/or
processing of Dairy products
 Processing of Crude and
refined edible oil
 Processing of Starch, cornflakes
and edible oil from maize
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Agro processing Cont.…
 Processing of Coffee and spices
 Manufacturing of baby food and
similar food products
 Production of spaghetti, macaroni
and other similar products
 Brewing and wine making
 Sugar and sugar related
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 Construction
• There is a construction boom
in Ethiopia; urban housing,
road, railway, power
interconnections, etc…
• Real estate developments
Source:- ethiopicture.com
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Foreign Investors have the opportunity to invest in the following
• First Grade Construction Contracting
 General Construction Grade one (GC-G1)
 Building Construction Grade One(BC-G1)
 Road Construction Grade one (RC-G1)
• Water well drilling
• Mineral Exploration drilling
• Real estate Development
 There are possibilities to participate in Bids for public
projects
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 Other Investment Opportunities
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Information and Communication Technology (ICT)
Mining
Tourism
Cargo Air transport Service
Health
Education
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 Major Export items
The main agricultural export products are ;
Cereals and other Food Crops ...... Wheat, Maize, Barely,
Beans, Lentils, Soybeans, Chick peas, etc…
Edible Oil crops Sesame seed, Rapeseed, Linseed,
Groundnuts, Sunflower, Niger seed and Cotton seed
Spices Black cumin, Cumin seed, Cardamom seeds, Garlic,
Onion, Ginger root, Rosemary, Pepper, Mustard, etc…
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Major Export items Cont.…
Beverage crops ….. Coffee, Tea, Roman chamomile
Fiber production ….. Cotton 322,000h. land available, silk
Feed stocks for bio-diesel ….. Palm oil, Jatropha, Castor oil
 Feed stocks for ethanol ….. Sugarcane, Sugar beet, potatoes,
corn, etc.
 Recently the Horticulture and floriculture is becoming one
of leading export area
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Ethiopian Tourist Destinations
• Ethiopia is elected as World Best Tourist Destination In
2015 by European Council on Tourism and Trade
(ECTT)
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Ethiopia has 10 universally important heritages which are
registered as World Heritage sites by UNESCO
Axum Obelisk
Axum Onlisk
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The Rock-Hewn Churches
of Lalibela
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