INVEST IN ETHIOPIA
Ethiopia is open for business—not only in the traditional manufacturing and agriculture sectors, but also in newer sectors such as telecom, financial services, and several privatization opportunities.
With a population of over 120 million, an emerging middle class with increasing purchasing appetite and power, access to over 586 million people market in COMESA, unlimited import-substitution and export opportunities, preferential duty-free agreements, attractive incentives, access to competitive talent, increasing connectivity through Ethiopian Airlines, and improving infrastructure, we offer the best ingredients for emerging sectors in the country.
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.
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.
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.