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ICOS Consulting PLC
© 2017 Addis Ababa, Ethiopia

We are leading this sector since 2009.
What are Ethiopia’s most promising business opportunities?

Ethiopia is endowed with abundant agricultural resources and has diverse ecological zones. In 2009, the Government of Ethiopia (GOE) shifted its agricultural policy focus towards encouraging private investment (both domestic and foreign) in larger-scale commercial farms. The Ministry of Agriculture (MoA) created a new Agricultural Investment Support Directorate that is currently negotiating long-term leases on over seven million acres of land for these commercial farms. The new Directorate's goal is to boost productivity, employment, technology transfer, and foreign exchange reserves by offering incentives to private investors.

GOE also seeks to attract investors through incentives for priority export sectors - textiles/garments, leather, horticulture/floriculture and agro-processing. Many Ethiopian goods are eligible for duty-free access to the U.S. market under the African Growth and Opportunity Act (AGOA). Leading non-agricultural sectors for U.S. trade and investment include: renewable energy, information technology and communications (ICT), construction, tourism and aviation. The GOE has developed a list of approximately 200 eServices or electronic services needed to be developed in the next several years.

Nearly all tenders issued by the GOE's Privatization and Public Enterprises Supervising Agency (PPESA) are open to foreign participation. Most of the 310 public enterprises sold since 1994 have been small enterprises in the trade and service sectors. There are several examples of big privatized enterprises such as four breweries which were acquired by foreign enterprises including Heineken (Holland) and Diageo (UK).

Tell me more about investment opportunities?

Ethiopia has abundant agricultural resources and diverse ecological zones. Opportunities for investment exist in agriculture, specifically by investing in large scale farming or engaging in supplying the needed agricultural inputs (machineries, fertilizer, seeds, etc). The Government of Ethiopia is currently encouraging private investment (both domestic and foreign) in larger-scale commercial farms.

With the ongoing heavy investment on renewable energy sources in the country, there is demand for engineering services in the areas of wind, solar, geothermal, biomass (municipal landfills, organic waste) as well as hydropower. Equipments necessary for generation, transmission and billing of electric power are also in high demand and could prove to become an investment focus over the next period.

Information and communications technology (ICT) is rapidly evolving from a relatively low base. Sub-sectors such as mobile banking services and outsourcing services, website software and technologies, software development for eGovernment services, and ICT training services are going to be among the major investment opportunities in the country.

The ambitious road construction and expansion projects in the country also offers opportunities either to directly involve in the construction work or export of construction machinery, chemicals, and building materials as well as consultancy and supervision services.

What sources of finance are available locally?

Access to finance is challenging on the local market. The best source for large scale local finance is the Development Bank of Ethiopia if the investment happens to fall among the so called “priority sectors”. The bank provides loans up to 70% of the investment for commercial agriculture, agro-processing, manufacturing and extractive industries, specifically supporting export-focused ones.

Local commercial banks often require a large percentage of the loan as collateral, which is usually consist of liquid assets and real-estate physically located in Ethiopia. Banks in Ethiopia are constrained with various administrative directives that severely diminish their potential to offer more loans to the private sector.