Invest in Ethiopia has been saved
Invest in Ethiopia
Structural reforms set to unlock East Africa’s largest economy
Ethiopia has succeeded in becoming one of the world’s fastest growing economies. Over the 2008-18 period, Ethiopia has recorded an average real GDP growth rate of 9.9%. This broad-based high growth rate has been supported by structural reforms that have been introduced through industrial sector development. Prime Minister Abiy Ahmed has announced numerous reform plans, including plans to loosen the state’s dominance in key sectors, in efforts to attract investor interest and boost growth.
Key take-outs from this report
- The industries sector is set to become Ethiopia’s largest GDP contributor by 2025. Ethiopia is expected to become an industrial-based economy.
- Ethiopia is Africa’s second most populous country with a population of 107 million people. The country’s population structure is expected to change towards a working-age dominated structure – a boon for disposable income and economic growth
- Ethiopia has maintained strong investor interest as one of the top investor destinations in Africa, becoming the second largest FDI recipient in Africa. The recent launch of the African Continental Free Trade Area (AfCFTA) is expected to fuel investments.
- Ethiopia’s Investment Code provides incentives for development-related investments, reduces capital entry requirements for joint ventures, permits the duty-free import of capital goods (except computers and vehicles), opens the real estate sector to foreign investors, extends the relief for losses carried forward and gives priority to investors for the lease of land.
- Sectors to watch include:
o Automotive - The automotive industry presents a long-term opportunity for first movers
o Power Infrastructure - The Grand Ethiopian Renaissance Dam is projected to be Africa’s largest hydropower plant
o Agriculture - Agro-economic zones are expected to support agricultural growth through investments
o Construction – Construction activities account for 71.4% of the industries sector
How can Deloitte help
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