Time to Invest in Ethiopia

Commissioner Lelise Neme,
Dear esteemed investors,
Ethiopia as known by many as the land oforigins, is endowed with a swathe of investment
opportunities at all corners of the country. In thelast decade, the country has achieved aremarkable and fast economic growth. Home tothe continent’s second largest population, thecountry has been attracting high amount of
Foreign Direct Investment (FDI) in recent years.
Backstopped by a profound economic strategy
and policies, the Government has been putting
efforts to create a business environment that is
conducive to investment through development ofvarious infrastructures.
Even though the country is positioned as a yet
untapped investment opportunity in Eastern
Africa, its remarkable growth is amplified withvarious values and assets. The Government hasestablished infrastructures such as specialized
industrial parks that serve as a conducive
microclimate to investments and are equippedwith efficient and effective services, healthcare
center, commercial buildings, proper waste
treatment facilities, police stations, fire brigade
and 24/7 security services.
With an overarching “homegrown economic
reform” agenda which supports the fast growthand puts the private sector at the heart of theeconomic development, the country prioritized
seven investment sectors i.e., Textile & apparel,

Leather & leather products, Pharmaceuticals, Agroprocessing, Tourism, ICT, Mining and Energy.
Tailored fiscal and non-fiscal incentives including
customs, duties, and income tax exemptions,guaranteed repatriation of funds, bonded export
facilities and availability of active and trainable
labor which represents 60% of the total
population offers great investment opportunity.
Market access is also another opportunity the country
offers for successful investments. The strategic locationof the country that serves as a spring off point to various
African countries, Europe and Asia, different trade
agreements. Furthermore, equipped with efficientlogistical hub such as Air transport through thelegendary Ethiopian airlines, clean powered railway,
suitable dry ports, well-connected express roads, andhighways provide expedited transportation services toinvestments.
As mandated and being an autonomous
government institution, the Ethiopian Investmentcommission (EIC) carries out efficient investment
administration system to attract foreign anddomestic investments to Ethiopia throughpromotional, facilitation and aftercare services.

This guide is prepared to serve as an informational primer for you in the arena of investingin Ethiopia including priority sectors and overview of different assets that you may wish
to consider. It is not a detailed guide to a specific investment sector, but we’ll be offering
those subsequently. Finally, I sincerely invite you to invest in Ethiopia. We are highlycommitted to become a re liable partner on your investment journey.

CONTENTS
Ethiopia at a Glance
Why Invest in Ethiopia
Investment Opportunities
Industry Parks Development
Investment Incentives
Investment Facilitation, Protection and Guarantee

Setting Up Investment
Requirements to Obtain Investment Permit

Factors at a GlanceLaws & Regulations
Government Institutions' Mandates
Client Charter
Useful Contacts

ETHIOPIA:
LAND OF INVESTMENTOPPORTUNITIES

1.Ethiopia at a glance
POLITICAL SYSTEM
Federal State with multi party
systemREGIONSCAPITAL CITY

11 Regions and two City Administrations

Seat of African Union (AU) andUNECALEADINGEXPORTS

Coffee, oilseeds, gold, horticulture products, gold, pulses, live

GDP & GDPPER CAPITA

126 billion USD (2022) & 1,212 respectivelyCanimals, growing manufacturing export including textile &apparel, leather & leather products, and others.

CLIMATE

Temperature in the highlands: 20’ c-30’c, low in the highlands
Up to 45’ c, Rainfall ranges from 200mm to 2000 mm andHighly suitable for production

AREA

1.1 million square kilometers

LOCATIONPOPULATIONLANGUAGE

Horn of Africa, at the

2nd most populous nation

Working federal language

currency: Ethiopian Birr

Crossroads between Africa, thein Africa (120+million)

Amharic & English is widelyCountry code +251

Middle East & Asia

An Investment Guide to Ethiopia Spoken

OTHER INFOTime Zone: GMT+3

2. Why Invest in Ethiopia?
With a vision of making Ethiopia a competitive and preferredinvestment destination by creating productive economic cluster, thegovernment is tirelessly working hard to promote the investment
opportunities of the country to attract quality foreign direct
investment (FDI) ever before.
Ethiopia’s untapped investment potential makes the nation one of
the ideal destinations for several global brands and top
businesspersons. Moreover, the rapid development of the country
has opened a plethora of opportunities for foreign investors, which
can be explored on this Investment Guide.
Being one of the fastest growing economies in the world, Ethiopia
continued to be among the top five FDI destinations in Africa andthe biggest recipient in East Africa due to its:

Government Commitment to Investment
The Ethiopian government is committed to make theinvestment policy beneficial to the country and the investors.
The

newly

amendedInvestment

Proclamation

andRegulation have been enacted as of 2020 to enhance therole of the private sector in the economy and further
improve issues regarding the investment.
The amened Regulation has changed the positive list approach
into a negative list. The shift towards a negative list is significant
aspect of the new investment law because foreign investors are
now allowed to invest in any investment area except those thatare expressly reserved.

An Investment Guide to Ethiopia 1

The government under the leadership of PM Abiy Ahmed(PHD) - unveiled a Homegrown Economic Reform Agenda
aimed at unlocking the country’s development potentials
designed to propel Ethiopia into becoming the African icon
prosperity by 2030.
Improving socio-economic governance with peace andsecurity.
High level political commitment for investment promotion
and protection; investment policy making is led by the
Ethiopian Investment Board chaired by the Prime Minister.
Wide-ranging investment incentive packages for priority
sectors and export-oriented investments.
Bold initiative in the development of state-of-the-art industrial
parks, electric-powered railway connecting the capital andother economic corridors to the port of Djibouti.

Conducive Economic Factors
Ethiopia is the second most populous nation in Africa, and still
the fastest growing economy in the region with 6.4% growth in
FY2020/21. Over the past 15 years, Ethiopia’s economy has
been among the fastest growing in the world at an average of
9.5% per year (World Bank Report, 2022).
Ethiopia aimed to achieve a lower-middle status by 2030 andsustain its economic growth to achieve medium-middle andhigher-middle status by 2040 and 2050 respectively.
The structural reforms designed to strengthen the private
sector to drive growth and create more jobs.

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An Investment Guide to Ethiopia

Stable and conducive macroeconomic environment.
The FDI inflows to Ethiopia averaged $3.35 billion from 2015
to 2020. Moreover, in 2021 the FDI inflows increased by 18%
from the preceding years and jumped to $3.95 billion.
The government has been also undertaking economic
reforms, including liberalization of financial sector that allows
foreign banks to enter the economy.

Favorable Market Factors
Africa’s second most populous nation with a population sizeof 120 million.
Over 60 million active labor force, trainable and available
at competitive wage rate.
Duty-free, quota-free access to EU markets throughEverything but Arms (EBA). Preferential market access to India.
Duty-free, quota-free access to Japan, Canada, China, Turkey,
Australia, and New Zealand – covering substantially all export
goods from Ethiopia.
Ethiopia is a member of ACFTA (African Continental Free
Trade Area) which is very beneficial for investors in terms oftrade activities within African continent.
Member of COMESA with preferential market access to aregional market of 400 million people.
Strategic location with proximity to the Middle East, Europe,and Asia.

An Investment Guide to Ethiopia 3

Improving Infrastructure
The newly built Addis-Djibouti electric-powered railway is fully
operational.
Ethiopian Airlines Group, the largest Aviation Group in Africa
has successfully completed a new passenger terminal at its
hub Addis Ababa, Bole International Airport. From its hub,Ethiopian serves more than 131 international and 22 domestic
destinations.
Huge investment potential in renewable energy includinghydropower, solar, wind and geothermal. Of the total
potential, over 95% is generated from renewable energy.
The Grand Ethiopian Renaissance Dam (GERD) – thelargest hydroelectric power dam in Africa. GERD is on theverge of completion and expected to generate 6,450MW. The
price of electricity in Ethiopia is the cheapest in the world
which is $0.028 per KWh.
Expanding telecommunication services. Safaricom, a leading
African telecommunications company, has also invested in
Ethiopia.
Expansive road networks connecting national and regional
markets.
Ethiopia so far has constructed and put to work numerous
state-of-the-art industrial parks in different parts of thecountry.

3. Investment Opportunities
and Priority Areas
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An Investment Guide to Ethiopia

There are numerous attractive investment opportunities in
Ethiopia. The government in collaboration with supporting
stakeholders has already identified several investment
opportunities. Investors are rewarded with different incentives
based on their project and sector they prefer to engage in. The
investment opportunities, priority sectors
incentives are presented as follows: -andinvestment

Before going deep into the opportunities, it is important to pointout areas where investors are eligible to invest. Foreign
investor(s) can engage in various investment sectors according
to the Ethiopian investment regulation No. 474/2020. Somesectors previously closed are now opened for foreign investors.
In this regard, Telecommunications, Logistics & Transportationindustry as well as Financial sector are worth mentioned.
(Please refer the amened Ethiopian Investment Regulation No.
474/2020 from EIC website: www.investethiopia.gov.et).

An Investment Guide to Ethiopia 5

Agriculture

Ethiopia is endowed with abundant agricultural resources andhas diverse agro-ecological zones. Ethiopia is Africa’s leading
producer of organic coffee; the second largest flower exporting
country in Africa and the fourth in the world as well as regional

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An Investment Guide to Ethiopia

lead in honey and beeswax production.
The agriculture sector accounts for 47% of the GDP, 80% of
exports, and absorbed 83% of the country’s workforce.
Agriculture is one of the best prospect investment areas.
Opportunities for investing on agriculture include but notlimited to:

Cereal and Oilseeds
Ethiopia produces mainly a variety of cereals, pulses,
oilseeds, and other industrial crops.
Of the total 1.1 mln square kms area of the country, 75 mln
ha is suitable for annual and perennial crop production.
The irrigation potential of the country is estimated to bearound 4.3 mln ha.
Ranked 9th top producer of sesame globally (FAO, 2019).
Niger seed, Sesame, Ground nuts, Linseed and soybeans
are the top five products by volume.
Over 204,000 ha of land suitable for sesame production.

Dairy Farm
Ethiopia has the largest inventory of livestock in Africa, and a
relatively favorable climate for improved, high yielding dairy
cattle breeds. Over the past 17 years, volume of cow milk
production increased modestly from 1 billion to 4 billion liters.
There is 2.5mn ha of suitable land for dairy production and threepublic ranches that are soon to be privatized.

Poultry
Ethiopia ranked 9th in chicken population in Africa. Despite its
potential, the average per capita poultry consumption of thenation is 0.5k. It is significantly lower than the Sub-Saharan
An Investment Guide to Ethiopia 7

Africa average of 2.3 kg. Imports of chicken meat increased bynearly 60% in a period of 10 years and risen by 32% between
2008-2013. There is a shortage of day-old chick (DOC) supply.
In addition, foreigners can invest and do lucrative business in thehorticulture development, coffee and tea plantation, cotton
plantation, animal feed, livestock, fishery, sugarcane plantation,
palm tree and rubber tree plantation, apiculture, and otheragricultural investment areas.

Manufacturing
Ethiopia is Africa’s largest raw material supplier for the textile
and leather industries. The country offers a remarkablecompetitive advantage for the manufacturing industries due
to:Government
facilitationofefficiency-enhancing
investment solutions including modern industrial parks
that are ready for ‘plug and play’,Large pool of trainable work force available atcompetitive wages,
Cheapest energy rate on a global standard,
Geographic proximity and preferential access to keymarkets, andAbundance of high-quality industrial raw materials.

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An Investment Guide to Ethiopia

Textile and Garment

The textile & garment sector in Ethiopia has been growing in thepast decades. There is access to major markets in the local andinternational market. USA & UK are the major export destinations
for the products.

Opportunities for Private Sector:
The major investment opportunities on this sector includes
commercial cotton production, spinning, weaving and garment.
Textile manufacturing: Manufacturers producing any
cloth or goods prepared by weaving, knitting, or felting.
Garment manufacturing: Manufactures producing any
article of clothing such as dresses, suits, shirts, trousers,
ready-made prepared from textile/ fabric.
Components and Trim manufacturing: Manufacturers
producing materials used as components & decorations ofgarments such zippers, buttons, plastics, threads, elastics,
carton boxes, poly bags, hangers, printing, etc.

An Investment Guide to Ethiopia 7

Leather and Leather Products

Ethiopia’s livestock population ranks first in Africa and sixth in
the world (61 mln heads of cattle, 32 mln heads of sheep and
31mln heads of goats). The leather industry bases itself on the
country’s livestock resources. This enormous population of
livestock provides ample opportunity in the value chain startingfrom tanning of hides and skins all the way up to the finishedleather products. Manufacturing companies can supply major
markets in the world including Italy, USA, & Germany.

Opportunities for Private Sector Includes:
Tanning of hides and skins.
Chemical inputs manufacturing for tannery use.
Footwear, gloves, and other leather goods manufacturing.
Accessories: soles, synthetic sewing thread, plastic linen,
shoelaces, zippers, buckle.

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An Investment Guide to Ethiopia

Pharmaceuticals

One of the fastest growing industries in Ethiopia with an annual
growth rate of 15%. Currently, the market is estimated to bearound one billion USD, of which over 80% is met by imported
products that are mainly procured by the Government. Ethiopia
is the first African countries to have developed a strategy for thepharmaceuticals industry.

Favorable Conditions for Pharmaceutical
Manufacturing in Ethiopia
Kilinto Industrial Park, designated for the pharmaceuticalindustry, is well-equipped with modern infrastructure.
It is one of the priority investment areas.
High and growing domestic and regional markets. The
African pharma market is valued to be over $20 Billion.
Attractive investment incentives such as corporate income
tax exemptions up to 14 years depending on product typeand export performance.

An Investment Guide to Ethiopia 9

Long-term Government procurement guarantee, 25%
price preference and 30% advance payment to the
suppliers.
Trainable workforce with several pharmacy schools.
Competitive infrastructure including Ethiopian Airlines
and a railway connecting Kilinto Industrial Park to Djibouti
port.

Agro-Processing

Potential
Ethiopia is a continental and global leader in the
production of a variety of raw materials needed for agroprocessing:
5th largest producer of tropical fruits in Africa.
3rd biggest producer of wheat in Africa.
6th leading producer of livestock population globally.
9th in chicken population in Africa

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An Investment Guide to Ethiopia

Fruit Juice
Ethiopia has favorable agro-ecological climate condition.
Most of the land available for growing tropical fruit issuitable for organic.
Arba Minch, Upper Awash valley and Assosa are highpotential areas for year-round.
With basic irrigation, a new producer can increase yields
dramatically.

Edible Oil
Ethiopia has abundant resources suitable for oilseeds
production. Despite its potential, there is limited domestic
processing of edible oil (~4% of supply) and increasing
local demand, resulting in significant imports of edible oilcovering ~95% of supply consisting mainly palm oil.
Ethiopia is among the top 20 oilseeds producers in Africa,
with majority of exports still being in raw form, with novalue addition.

An Investment Guide to Ethiopia 11

Horticulture

Ethiopia is the second largest producer of cut flowers in Africa andthe fourth in the world after the Netherlands, Colombia, Ecuador
and Kenya.
The horticulture investment opportunities include cultivation of
flowers, fruit and vegetables as well as herbs. Ethiopia has a
growing flower export business and currently supplies 9% of
global flower market. Cut flowers, gypsophila, hypericum,
limonium, chrysanthemum, carnations, static and pot plants arewidely cultivated in various agroecology.

Herbs and Spices
The major export herbs from Ethiopia includes chives,
basil and rosemary.
Total potential for growing low land spice is estimated to
be 200,000 ha.

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An Investment Guide to Ethiopia

Bamboo for Green Investment

The Government proclaimed a 10year strategy and action planfor bamboo sector development (2019 – 30) and with the supportof the International Bamboo and Rattan Organization (INBAR),
Ethiopia has the largest resource of bamboo in Africa, withan estimated 1.47 million ha of two indigenous bamboo
species in most regional states.
Potential investors and entrepreneurs have an array ofopportunities to become pioneers of bamboo business inthe country.

Potential Areas of Bamboo Investment
Bamboo has a huge potential to contribute to the developmentof Ethiopia’s green economy. Opportunities for investing on
bamboo mainly include:
Bamboo timber substitute industries (parquet floor, MDF
and OSB boards, lumber and panels, mat ply boards,
plastic composite products);
Construction, pulp & paper; bio-energy, eco-tourism,
carbon credit plantation and others.

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An Investment Guide to Ethiopia

Integrated Agro Industrial Parks

The government has put in place integrated agro industrial
parks (IAIPs) to attract more investments and accelerate
the growth of agro-processing sector.
Just to mention, Bulbula Integrated Agro-Industrial Park,
Bure Integrated Agro-Industrial Park, and Yirgalem
Integrated Agro-Industrial Park have become operational.
Baeker Integrated Agro-Industrial Park is also in thepipeline.
The parks employ a holistic approach for input supply, onfarm production, backward market linkages and raw
material sourcing to ensure sustainability and efficiency.

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An Investment Guide to Ethiopia

Tourism

Known as ‘Land of Origins’, Ethiopia is among the world’s
best destination for tourism.
Ethiopia is a land of rugged mountains (almost 25
mountains with over 4000 meters high) broad savannah,lakes and rivers.
With 14 major wildlife reserves, Ethiopia provides a
microcosm of the entire sub-Saharan ecosystem.
The unique Ethiopian Rift Valley (part of East African Rift
Valley) is a remarkable region of volcanic lakes, with theirfamous collections of birdlife, great escarpments andstunning vistas.

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An Investment Guide to Ethiopia

The timeless charm of Ethiopia’s natural, cultural andhistorical tourist attractions has been driving an influx of
tourists from far and wide.
As the land where mankind, coffee and the Blue Nile trace
their roots, Ethiopia has always been a fascinating
destination for holidaymakers.
As the Meetings, Incentives, Conferencing & Exhibitions(MICE) tourism blossoms around the world, Ethiopia isalso uniquely positioned to reap the benefits, owing to its
unique place in Africa’s diplomatic landscape.
Ethiopia is amongst the countries that have registered their
tangible and intangible heritages under UNESCO cultural
heritage list. So far, UNESCO has recognized 13 heritages (ninetangible&four intangible). The nine tangible heritages

registered by UNISCO are:Semen National Park, natural
site registered in 1978.

Lalibela Rock Hewn Churches
registered in 1978.
Fasil Ghebbi (Castles),registered in 1979.

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An Investment Guide to Ethiopia

Lower Omo Valley, registeredin 1980.
Lower Awash Valley registeredin 1980.

Aksum Obelisk, registered in 1980.

Tiya Archaeological site
registered in 1980.

Harar Jugol (Fortified City),
registered in 2006.

Konso Cultural Landscaperegistered in 2011.

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An Investment Guide to Ethiopia

Opportunities
Star designated hotels, lodges, and restaurants.
Eco-lodge camp
Boat transportation
Hot-air ballooning
Sky-cable car
Lake side resorts

Incentives for Tourism
Duty free privileges on finishing construction materials (ifinvestors build the hotel themselves).
Duty free import of the following vehicles. (Source: Vehicle
Incentives Directive, 2013)
A bus (minimum capacity of 30 passengers excludingthe foldablesits)
5 years of income tax exemption for those who invest on
the five specified regions. (Source: Ethiopian Investment
Board Directive, 2017 & Investment Incentive 517/2022)
I. Bale and Semen Mountain national parks
II. Rift valley lakes (Abyata Shalla and Abaya Chamo)
III. Guralta Mountains (Wekro, Hawzen and Adigrat)
IV. Erta Ale (Dalol, Hadar, Afdera and Asela lakes)
V. Wonchi Crater Lake and afro alepine forest and other related
tourist attraction sites.

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An Investment Guide to Ethiopia

Mining
Ethiopia has a wide variety of untapped mineral resourcesand offers opportunities in upstream and downstream
operations.
Ethiopia is the only producer of opal in Africa, major gold
exporter and emerging country for oil and natural gas
exploration.
Mining potentials: gold, potash, platinum, opal, iron,tantalum, marble, granite, limestone, etc.

Incentives
Lower corporate income tax rate of 25% for largescale mining projects
Loss carry forward for 10 years.
Accelerated depreciation on straight line basis overuseful life of four years.
Customs duty and other tax-free import of equipment,machinery, vehicles, and consumables.

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An Investment Guide to Ethiopia

Attractive Royalties
7% Precious minerals
6% Semi-precious minerals
4% for industrial minerals
5% for metallic minerals
7% for gold
3% Construction minerals
Petroleum royalties are negotiable.

EnergyEthiopia is well known as a water tower of Africa. Thus, there are many
investment opportunities on the energy sector. The
government offers attractive incentives for investors who wish
to engage in the sector.
Ethiopian government has also assigned one independent
organization, Ministry of Water and Energy (MoWE), to manage
this the sector. MoWE is the lead institution for the Energy sector
oversees three supervised institutions.

Ethiopian Energy Authority
Ethiopian Electric Power (EEP)– has the responsibility togenerate, transmit and wholesale power.
Ethiopian Electric Utility (EEU) – has the responsibility to
distribute and sale in retail.
Ethiopian Energy Authority (EEA)-regulatory body for Energy
and energy efficiency.

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An Investment Guide to Ethiopia

Investor(s) can engage in the following activities including
power from the following sources: Hydro power,
Solar,
Wind, andGeothermal
The GERD, the largest hydroelectric power dam in Africa, which
is on the verge of completion is expected to generate 6,450 MW.

Potential
Ethiopia is endowed with various energy resources. Thesemainly include hydropower, geothermal, solar and wind.
Huge hydropower potential estimated up to 45,000 MW,
1,350,000 MW potential from wind energy,
Up to 10,000 MW potential from geothermal,
Solar irradiation ranges from 4.5 kWh/m2/day to 7.5
kWh/m2/day,Generating power from waste geothermal is also a potential
bioenergy resources accumulated in cities and towns.

Incentives for Energy
An investor engaged in power generation and supply ofelectricity shall be entitled to a tax holiday from 4-5 years
depending on the region where the investment will be
made.

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An Investment Guide to Ethiopia

Information Communication Technology(ICT)

The government of Ethiopia focuses on building an inclusive
digital economy. In 2018, the government announced its
decision to proceed with the privatization and liberalizationof the telecommunications sector.

Government Plan on ICT Sector
Creating an enabling environment for creative industries
and innovation.
Enhancing the role of the sector in socio-economic
activities to enable the country to grow rapidly.

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An Investment Guide to Ethiopia

Expanding ICT coverage across of the nation.
Providing competitive ICT services in terms of cost andquality.
Creating a conducive environment for the private sector
by implementing ICT effectively and efficiently.

Opportunities:
Telecommunications service,
Software, application and database development,
System integration and data center services,,ICT enabled service,
Manufacturing of ICT equipment, andE-commerce and ICT infrastructure.

Overview of the ICT ParkThe government has built a park dedicated to ICT sector.
The park, established on a 200 ha, is built with an intention
to create an Information communication Technology (ICT)
village based on close linkage between research, industry
and business in ICT and ICT enabled services.
The primary focus of the park is to attract investors on ICT,
manufacturing, development of the ICT services industry
and business process outsourcing.
N.B EIC has prepared 100 investment opportunity profiles inGreenfield investment with the support of UNIDO.
Please find the link below: https://investment.unido.org

An Investment Guide to Ethiopia23

4. Industry Park Development

With a view to enhancing FDI, the government places
significant importance to industrial parks development andexpansion. Foreign and domestic investors can engage inindustrial park development and start operation in theparks.
The parks are located along key economic corridors
connected to ports, by electric-powered railway lines
and roads.

Operational Industrial Parks in Ethiopia

1. Hawassa Industrial Park
Location: Sidama Region
Distance: 271 km from Addis Ababa, 718 km from port of Djibouti
Specialization: Textile and Apparel
Area: 2,140 ha

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An Investment Guide to Ethiopia

2. Bole Lemi-I Industrial Park
Location: Addis Ababa
Distance: 892 km from port of Djibouti
Specialization: Textile and Leather
Area: 172 ha

3. Kombolcha Industrial Park
Location: Amhara Region
Distance: 367 km from Addis Ababa, 375 km from port of Djibouti
Specialization: Textile and Apparel
Area: 75 ha

4. Adama Industrial Park
Location: Oromia Region
Distance: 92 km from Addis Ababa, 791 km from port of Djibouti
Specialization: Textile and Leather
Area: 365 ha

5. Bure Integrated Agro-Industrial Park
Location: Amhara Region
Distance: 414 km from Addis Ababa, 670 km from port of Djibouti
Specialization: Agro-processing Industry
Area: 365 ha

6. ICT Industrial Park
Location: Addis Ababa
Distance: 890 km from port of Djibouti
Specialization: ICT and ICT enabling service
Area: 280 ha

An Investment Guide to Ethiopia25

7. Dire Dawa Free Trade Zone
Location: Dire Dawa City Administration
Distance: 520 km from Addis Ababa, 321 km from port of Djibouti
Specialization: Free Trade
Area: 150 ha

8. George Shoe Industrial Park
Location: Oromia Region
Distance: 64 km from Addis Ababa, 828 km from port of Djibouti
Specialization: Tannery, Leather products and Textile
Area: 80 ha

9. Eastern Industrial Park-I
Location: Oromia Region
Distance: 30 km from Addis Ababa, 862 km from port of Djibouti
Specialization: Mixed
Area: 233 ha

10. Debre Birhan Industrial Park
Location: Amhara Region
Distance: 131 km from Addis Ababa, 808 km from port of Djibouti
Specialization: Textile and Apparel
Area: 100 ha

11. Jimma Industrial Park
Location: Oromia Region
Distance: 348 km from Addis Ababa, 1,167 km from port of Djibouti
Specialization: Textile, Leather and Agro-processing
Area: 75 ha

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An Investment Guide to Ethiopia

12. Bahir Dar Industrial Park
Location: Amhara Region
Distance: 552 km from Addis Ababa, 907 km from port of Djibouti
Specialization: Textile and Apparel
Area: 75 ha

13. Kilinto Industrial Park
Location: Addis Ababa
Distance: 890 km from port of Djibouti
Specialization: Pharmaceuticals
Area: 280 ha

14. Yirgalem Integrated Agro-Industrial
Park

Location: Sidama Region
Distance: 310 km from Addis Ababa, 758 km from port of Djibouti
Specialization: Agro-processing Industry
Area: 176 ha

15. Bole Lemi-II Industrial Park
Location: Addis Ababa
Distance: 892 km from port of Djibouti
Specialization: Textile and Leather
Area: 181 ha

16. Semera Industrial Park
Location: Afar Region
Distance: 564 km from Addis Ababa, 306 km from port of Djibouti
Specialization: Mixed
Area: 138 ha

An Investment Guide to Ethiopia

2717. Bulbula Integrated Agro-Industrial
Park

Location: Oromia Region
Distance: 184 km from Addis Ababa, 940 km from port of Djibouti
Specialization: Agro-processing Industry
Area: 271 ha

18. Mekelle Industrial Park
Location: Tigray Region
Distance: 772 km from Addis Ababa, 777 km from port of Djibouti
Specialization: Textile and Apparel
Area: 75 ha

19. Addis Tomorrow Industrial Park
Location: Addis Ababa
Distance: 892 km from port of Djibouti
Specialization: Mixed
Area: 8.7 ha

20. Arerti CCCC Industrial Park
Location: Amhara Region
Distance: 130 km from Addis Ababa, 790 km from port of Djibouti
Specialization: Construction Materials
Area: 100 ha

21. Huajian Light Industrial Park
Location: Addis Ababa
Distance: 892 km from port of Djibouti
Specialization: Leather and Leather products
Area: 138 ha

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An Investment Guide to Ethiopia

22. Redwa Industrial Park
Location: Dire Dawa City Administration
Distance: 520 km from Addis Ababa, 321 km from port of Djibouti
Specialization: Mixed
Area: 116 ha

23. Woda Industrial Park
Location: Oromia Region
Distance: 35 km from Addis Ababa, 927 km from port of Djibouti
Specialization: Metal Works
Area: 100 ha

24. Velocity Industrial Park
Location: Tigray Region
Distance: 772 km from Addis Ababa, 7 km from port of Djibouti
Specialization: Apparel and garment
Area: 176 ha

25. East African Industrial Park
Location: Oromia Region
Distance: 40 km from Addis Ababa, 832 km from port of Djibouti
Specialization: Mixed
Area: 100 ha

Upcoming Industrial Parks

26. Arerti Industrial Park
Location: Amhara Region
Distance: 130 km from Addis Ababa, 790 km from port of Djibouti
Specialization: Textile
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An Investment Guide to Ethiopia
Area: 50 ha

27. Baeker Integrated Agro-Industrial
Park

Location: Tigray Region
Distance: 970 km from Addis Ababa, 977 km from port of Djibouti
Specialization: Agro-processing Industry
Area: 258 ha

28. CCECC Industrial Park
Location: Dire Dawa City Administration
Distance: 520 km from Addis Ababa, 321 km from port of Djibouti
Specialization: Mixed
Area: 1,000 ha

29. Eastern Industrial Park-II
Location: Oromia Region
Distance: 30 km from Addis Ababa, 862 km from port of Djibouti
Specialization: Mixed
Area: 167 ha

The Industrial Park development is anchored on the principles of:Specialized parks: enhancing economy of scale andefficiency through the development of sector-specificspecialized industrial parks.
Export promotion: government provision of industrial
park incentives targeted at increased export
performance and competitiveness.
Sustainability:

maintaining

highenvironmental

standards through the use of renewable energy andzero liquid discharge (ZLD) technology; assuring social

30

An Investment Guide to Ethiopia

sustainability and local linkages.
Vertical integration: enhancing forward and backward
linkages in the economy; andSkills development and competitiveness: developing
employees’ skills
competitiveness.

forenterpriseproductivity

andIncentives for Industry Park
10-15 years income tax exemption for development ofindustrial parks depending on park location (10 years in
Addis Ababa or the surrounding special zones of Oromia,
15 years in other areas).
60-80 years land lease right at promotional rate; with sublease right.
Reliable electricity at globally competitive rate- government
avails dedicated power substation for industrial parks.

5. Incentives
Priority sectors identified in this Investment Guide and othersub-sectors mentioned in the investment regulation haveattractive incentives are listed below:

Fiscal Investment Incentives
1. Corporate Income Tax Exemption:
Exemption from corporate income tax up to 10 years
depending on the sector engagements.
Additional 2-4 years exemption for industrial park
enterprises with at least 80% export or input supply to

An Investment Guide to Ethiopia

31

exporters.
Additional 30% deduction for three consecutive years if
investment in underdeveloped regions.
Exemption from income tax up to 15 years for Industry
Park developers.

2.

Import Exemption:
Capital goods: 100% exemption from duties andother taxes on imports of capital goods (machinery &equipment).
Construction materials: Full exemption from duties
and other taxes on imports of construction & finishingmaterials (for investors who construct their own
factory).
Spare parts: with a value up to 15% of the total value ofcapital goods (100% of total value of capital goods forindustrial park enterprises that are fully exporters).

32

An Investment Guide to Ethiopia

Vehicles: Duty-free importation of delivery vans andtrucks will be implemented according to the Vehicles
Directive.

3. Export Incentives: Companies that produce theirproducts in Ethiopia and export have the following
incentives:
Full export duty exemption.
Full import duty exemption on raw materials needed
to produce export commodities.
Additional two years exemption for 60% exporters or
input suppliers to exporters within or outside ofindustrial parks:

4. Loss Carry Forward: a right to carry for after thebase income tax exemption period expires.

Non-Fiscal Incentives
Customs facilitation through bonded export factory andsimilar other schemes.
Guarantee against expropriation.
Guarantee for repatriation of funds.
Relaxed industrial park land regime 60-80 years chargefree lease for IP developers.
Discounted lease rate for IP enterprises.

An Investment Guide to Ethiopia633

Other Incentives
Personal effects for residents in industrial parks.
Investors buying above items from the local market canseek fund of the duty paid.
Export duty exemption on all products except semiprocessed hides and skins.
Loss carries forward- a right to carry forward loss incurred
within the period of income tax exemption for half of
the income tax exemption period after expiry, maximum
being 5 years.
The newly amended Investment Incentive Regulation No.
517/2022 provides incentives for Information &Communications Technology and Logistics Service
investment sectors.

6. Investment Facilitation,
Protection & Guarantee
Facilitation
One-stop shop and aftercare services under EIC (headoffice and industrial park branches).
Customs facilitation through bonded warehouse andvoucher schemes.
Expedited visa procedure- expedited procedure of
securing entry, work permit and certificate of residency.
Online visa and multiple visa services.
Online investment application services.

34

An Investment Guide to Ethiopia

The right to own immovable property as per investment
needs.
The right to open and operate foreign currency accounts.
The right to employ expatriate managers and experts.

Protection and Guarantee
Ethiopia has signed over 30 Bilateral Investment Treaties
including China, Germany, France, Turkey, Italy,
Belgium, Denmark, Finland, Netherlands, Sweden,
Austria, Israel, Swiss, Kuwait, Algeria, Egypt, and Sudanas well as several Double Taxation Avoidance
Agreements that provide investors with utmost protection.
The protection of intellectual property rights which
include trademarks, certification and collectivemarks.
The right to own a dwelling house when investing aminimum of 10,000,000 USD.
The country is also a member of the Multilateral
Investment Guarantee Agency (MIGA) and the WorldIntellectual Property Organization (WIPO).
Guarantee for repatriation of profits, dividends and otherfunds.
Constitutional guarantee to property rights.
Ranked 67/190 economies for ease of enforcing
commercial contracts-rating of OECD standard (Worldbanks’ Doing Business Report, 2020).
The right to open and operate foreign currency
accounts.
The right to employ expatriate managers and experts.
An Investment Guide to Ethiopia635

7.Setting up an investment
Foreign investor(s) can be engaged in the following
investment types:

A. Greenfield Investments: Ethiopian investment
Commission will give an investment license for greenfield
investments made by foreign investor(s) & joint investments
made between foreign investor(s) & local investor(s). A
foreign company or investor can form the business as a:
Sole Proprietorship: an individual is the owner of thecompany.
Private Limited Company: A new company formed by
two or more shareholders. The shareholders can be:
Two

or

more

companies

Company(s) and a person(s)Two or more individuals (The documentation will be thesame as the sole proprietorship company registration).
Branch Company: Existing foreign company can open abranch company in Ethiopia.

B. Brownfield Investments
According to the investment regulation no. 474/2020, foreign
investor(s) interested to buy an existing enterprise or sharesshould seek approval from Ethiopian Investment Commission.

36

An Investment Guide to Ethiopia

The initial step is to acquire investment permit from EIC. The
requirements and procedures are explained in detail in thefollowing pages.
The initial step for foreign investor(s) to form a company in
Ethiopia is to get an investment permit from EIC. Investor(s) canapply for an investment permit in person at EIC HQ or online via
this link: www.invest-ethiopia.com. In doing so, the investor(s)must comply with the requirements.

Sectorial Opening
The existing suitable economic development policy of the country,
government’s special attention to the investment sectors,
competitive and trainable labor force are among the major factorsthat enabled the country to become successful in attracting FDI.
Some important sectors which were previously closed are now
opened for foreign investors. The investors can engage inseveral investment activities based on the Investment
Proclamation No. 1180/2020 and Regulation No. 474/2020(except few sectors reserved for domestic investors others areopen for foreign investors).

An Investment Guide to Ethiopia637

8. Requirements to Obtain
Investment Permit
The requirements to obtain investment permit for foreign
investor(s) are capital and documents.

A. Minimum Capital Requirement
According to the Investment Proclamation No. 1180/2020, theminimum capital requirement and legal terms for foreign
investors to engage in various investment activities is statedbelow:
Investor(s)areexpectedtodeposittheminimum

requirement in cash after document approval andregistration at the EIC.
Foreign investor re-investing their profits or dividends
generated from existing enterprise in Ethiopia may not be
expected to deposit the minimum requirement mentioned
in the above table.

38

An Investment Guide to Ethiopia

Minimum Capital Requirement

Type of the sector

100%
foreigninvestor(s)For investment areas allowed
under the investment
proclamation

USD
200,000

Joint
venturewith local
investor(s)USD 150,000

Architectural, engineering
works or related technicalconsultancy services, technicalUSD
100,000

testing & analysis or in
publishing works

USD 50,000

B. Document Requirements
Foreign investor(s) are expected to submit the following
documents to get approval for their investment projectsfrom
EIC.
The document requirements for each type of company
formation is listed separately in the following table.

An Investment Guide to Ethiopia639

Document Requirements
Filled Application Form
Existing Company Profile

Sole
Proprietorship

Investment Visa & Passport copy
Filled Application Form
Existing Company Profile
Investment Visa & Passport copy
ParentPrivate Limited

Companyauthenticated inabroad, Ministry

Company

documents

Ethiopian embassyof
Affairs & local

authentication office (if the shareholder/s
are companies)
Draft of Memorandum & Articles of
Association for the proposed company.
Filled Application Form
AuthenticatedParentCompany

documents (Memorandum & Articles of
Association, Certificate of Incorporation,

Branchcompany

Minutes of Resolution)
Power of Attorney, Investment Visa of theGeneral Manager

N.B.
Application forms and draft MoA & AoA mentioned in the
table

can

be

found

online

from

EIC’s

website:www.investethiopia.gov.et
Investment Visa (IV) is required for foreign investors

40

An Investment Guide to Ethiopia

Visa applications can be obtained online via e-visa
website: www.evisa.gov.et or in person at Ethiopia’s
Diplomatic Missions overseas.
The Immigration and Citizenship Service (ICS) issues aresidence permit to a foreign investor upon submissionof an investment permit issued in his/ hername.
A foreign investor who is a shareholder of a company
or branch company as well as expatriate personnel who
have work permit are entitled to get residence permit.
Favorable visa terms for investors in industrial parks:
Multiple entry visa valid for up to five years is given forforeign investors; up to three years long visa for industrial
park service providers, managers, board members andsenior experts employed by foreign investors.

Registration and Licensing Processes at EIC
1Submit the following documents to EIC for approval
Sole

Filled application Form, existing Company

Proprietorship Profile & Investment Visa
Filled application Form, existing Company
Profile and,PLC

If the shareholders
Investment Visa,areindividuals=

If the shareholders are companies=
notarized parent Company documents
including Certificate of Incorporation,
Minutes of Resolution, Memorandum andArticle of Association & Power of Attorney.

An Investment Guide to Ethiopia

41

Branchcompany

Authenticate parent Company documents
including Certificate of Incorporation,
Minutes of Resolution, Memorandum andArticle of Association.
Power

of

Attorney,

Passport

andInvestment Visa of the General Manager.
After approval from EIC
2Only for PLC

Check uniqueness of the Company
Name at EIC
Edit, sign & authenticate Memorandum
and Articles of Association of the new
Company at EIC.

3

Collect a supporting letter from EIC to open a foreign &local bank account.

4

Transfer / deposit the required minimum capital in cash

5.

Submit authenticated office lease agreement & TIN
certificate (ONLY for PLC)

6

Submit confirmation letter to EIC & get the Investment
Permit Certificate.
All the mentioned documents in step 1 should be
authenticated by Ethiopian embassy abroad,
Ministry of Affairs & local authentication office
The average time to get an investment permit isfrom 3 to 5 business/working days.
EIC offers one-stop service for the above activities
and the cost is very minimal.

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An Investment Guide to Ethiopia

Industry Park Registration Process
Investors planning to develop an industrial park or make otherforms of investment within industrial parks will have to go
through different steps:
IP Developer: means any profit-making public, public-private
or private developer including the corporation engaged indesigning, constructing, or developing industrial parks inaccordance with investment proclamation & investment
regulations, industrial park developer permit and industrial parkdeveloper agreement.
Steps:
1. Application to EIC
2. Approval by the Ethiopian Investment Board
3. Sign an MoU with EIC
4. Registration and licensing at EIC
IP operator: means any profit-making enterprise that operates,
maintains or promotes industrial park in accordance with theInvestment Proclamation and Regulation, the industrial park
operator permits and industrial park operator agreement and,includes the Corporation.
Steps:
1. Application to EIC
2. Sign a tripartite MoU with IP developer & EIC
3. Registration & licensing at EIC
4. Sign operations management agreement with IP developer

An Investment Guide to Ethiopia

43

IP Enterprise/Tenant: means a public, private or public-private
enterprise owned by Ethiopians, foreigners or jointly andpossess developed land under the industrial park through sublease or by renting or building a factory within the industrial
park to engage in manufacturing activity or in-service provision
for profit making in accordance with Investment Proclamation
and Regulation, industrial park enterprise permit and industrial
park enterprise agreement.
Steps:
1. Application to EIC
2. Sign an MoU with EIC
3. Deposit commitment fee of USD 200,000 in IP Developer’s
account: to be accounted as part of initial capital or
licensing
4. Registration and licensing at EIC
5. Shed rental/sub-lease agreement with IP developer
6. Handover by IP developer
For further information regarding industry park, refer the“industrial park proclamation No. 886/2015.

Aftercare Services:
After acquiring an investment permit, the good hand of EIC will
follow you as you lay the ground for your operation. The EIC
provides post-establishment facilitation and follow-up services
including, but not limited to:Facilitating acquisition of land and loan processing
Facilitating power supply and other important utilities.

44

An Investment Guide to Ethiopia

EIC has been also launched an aftercare strategy aiming to facilitate
the investors:➢

Remainoperatetheirinvestment/

businesssmoothly in the country through retention.
➢

To expand their existing investments, and➢Re-invest their profit from their existing business &investments.

An Investment Guide to Ethiopia45

9. Factors at a Glance
Ethiopia offers a favorable business-operating environment. The
following provides an insight and a sense of the excellent
available opportunities.

Land
Land is available for investment on leasehold and rental basis.
Investor(s) can engage either in industrial parks or outside.
Industrial parks are governed by the federal government (EIC &Industrial Parks Development Corporation). In the case of landoutside industrial parks, each regional government authority has
the authority to give land for investments.
Land Cost: each region and industrial parks have different
rate. Please refer to the factor cost document on EIC’s
website: ( www.theiguides.org/ethiopia).
The government reserves dedicated land for commercial
farming of cotton, horticulture development and othersectors.
Lease right is given for up to 80 years (depending on
location and sector of engagement).
Industrial Park enterprises have the option of sub-leasing
developed land to construct own production facility inindustrial parks (they can also rent or buy factory sheds).

Labor
Ethiopia has a growing educated labor force. Over 50
universities with around half million student population:
Over 1,300 technical and vocational education andTraining (TVET) institutes with and annual intake close to
one million students.

46

An Investment Guide to Ethiopia

Globally competitive wage rate.
Government-supported

provisionofskills trainings

through industry development institutes
Flexible domestic labor laws and regulations:
1. No minimum wage requirement on private sector employers
2. Normal working hours per day is 8 (excluding breaks forlunch)
3. Maximum number of working days per week is 6 (288 days
per year)
4. No general restriction on night works
5. The number of paid annual leave days for a starting employee
14; slight increment for additional years of services.

Infrastructure
GERD, the largest hydroelectric power dam in Africa, is on
the verge of completion. Currently, the mega hydro dam isgenerating 375 MW electricity.
The electricity rate is presented below:
No.

Rates

Birr/KWh

General Tariff Flat Rate

1.7611Low Voltage Industry Tariff (Flat rate)

1.2927

Medium Voltage Industry Tariff-15Kv &33 KV (Flat rate)
High Voltage Industry Tariff (Flat rate)

0.99690.791147

WaterBeing the water tower of Africa, water charge rate is very
affordable and competitive in Ethiopia.
The rate is presented below:

Tariffcategory

Domestic

Recycled water

Water use for toilet

Watersupply for industry

supplieduse (ETB/m3).

flushing andgardening (ETB/ m3)
limited to what

from

Limited to whatborehole

is released foris released for(ETB/m3)

reprocessing.

reprocessing.

I(0-7)1.75

00

II (8- 20)

3.80

0

0

III (21-40)

7.75

0

0

IV (41- 100)

5.95

0

0

V (101-300)

7.45

0

0

I (301 -500)

9.3

0

0

11.6

0

0

(m3)

VII (600 andabove)

48
An Investment Guide to Ethiopia

Transport
Air
A

world-class

and

Star

Alliance member national
airline that flies to about 127
international passenger andcargo destinations acrossfive continents; also flies toover 23 domestic passenger
destinations.
Has promotional rate for export products.
Addis Ababa Bole International Airport serves as a regionalbase for other airlines such as KLM, Lufthansa, Emirates,
Qatar, and Turkish Airlines.

Road
International

highwaysconnecting Ethiopia
neighboring countries.

withA complex network ofdeveloped roads connecting
major

cities, towns

andindustrial parks, which are
ideal for business.

49
An Investment Guide to Ethiopia

Railway
Over 30kms Addis Ababa
lightrail-fully

operational,

with the capacity of 80,000
passengers/hour-first of its
kind in sub-Saharan Africa.
More than 750kms, Addis
Ababa Djibouti electric railway route completed-set to significantly reduce the timeand cost of inland transport for import/export items.
Several other rail-way lines under construction whichconnects all major economic corridors in Ethiopia.

Sea
Reliable

coastalandinternational marine andinlandwatertransport
services from the Ethiopian
Shipping and Logistics
Services Enterprise (ESLSE)
thatreachesto260

destination

ports.

Promotional rate for the manufacturing sector.
Approximate distance from the center-910kms to port ofDjibouti (gate for a lion’s share of import/export), 964kms
port of Barbara, 1881kms to port Sudan and 2077kms toport Mombasa.

50
An Investment Guide to Ethiopia

Finance
More than 25 banks and insurance companies are available.
The Development Bank of Ethiopia (DBE) provides
preferential loan for export-oriented investments.
Foreign investors can open a foreign account throughapproval from the National Bank of Ethiopia (NBE).
Lease and project financing scheme are available.
Foreign investors can access foreign loan

Tax
Tax Rates

Description

0-35%

Tax on income derived from employment

30%

Taxable income from business

3%

Withholding tax on goods imported for commercial
use

10%

Dividend tax on profits distributed to shareholders

5%

Tax on royalty income5%

Tax on interest income from savings in local financial
institutions

15%
0-35%

Value added tax on imported items that are note
exempted by law
Custom duty on imported items
Excise tax on selected import items defined by law

0-100%

2-20%(items considered luxurious, hazardous to health etc)
Turnover tax on supply of goods or rendering of services.

51
An Investment Guide to Ethiopia

10.Laws and Regulations

Ethiopia follows a civil law legal system where major laws arecodified under civil, commercial, penal, and other codes. The
constitution is the supreme law of the country, under theconstitution are proclamations that are passed by the parliament,
followed by regulations that are enacted by the Council of
Ministers, and implementing directives passed by Ministries or
Agencies, all proclamations and regulations are published in
official Gazettes. Below is the most relevant legislation as
related to investment.

Investment Laws:
Investment Proclamation No 1180/2020Investment.
Regulation No. 474/2020.
Investment Directives- Directive on Duty-free import ofMotor Vehicles No. 4/2005 (E.C).
Investment Incentive Regulation No. 517/2022.
A Directive to Provide for the Application of Tax Incentives for
Expansion/ Upgrading of Investment No. 941/2023.
A Directive to provide for the Type & Quality of Vehicles allowed
to be Imported Duty Free for Dev’t Projects No. 942/2023.

52
An Investment Guide to Ethiopia

Industrial Park Laws:
Industrial Parks Proclamation No. 886/2015
Industrial Parks Regulation, No. 417/2017

Commercial Matters:
Commercial Code No. 1242/2021
Commercial Registration and Business
Amendment Proclamation No. 1150/ 2019

Licensing

Trade Practices and Consumer Protection Proclamation
No. 813/2013
Civil Code No.165/1960 Amended Proclamation No.
639/2009.

Tax Laws:
Income Tax Proclamation No. 979/2016
Tax Administration Proclamation No. 983/2016
Value Added Tax Proclamation No. 1157/2019
VAT Regulation No. 79/2002
Excise Tax Proclamation No. 1186/2020

Labor Law:
Labor Proclamation No. 1156/2019.

Customs Laws:
Customs Amendment Proclamation No. 1160/2019
Export Trade Duty Incentive Schemes Proclamation No.
768/2012
Ethiopian Customs Guide, Ethiopian Revenues andCustoms Authority, March 201753
An Investment Guide to Ethiopia

Intellectual Property:
Copyright and Neighboring Rights Protection Proclamation
No. 410/2004, Amendment Proclamation 872/2014.
Trademark Registration and Protection Proclamation No.
501/2006
Trademark Registration and Protection Regulation No.
273/2012
Inventions, Minor Inventions, and Industrial Designs
Regulation No. 12/1997

Environmental Laws:
Environmental Impact Assessment Proclamation No.
299/2002
Environmental

Pollution

Control

Proclamation

No.

300/2002 Environmental laws:

Land Laws
Land lease proclamation No. 721/2011

Foreign Exchange Laws:
Transparency in Foreign Currency Allocation and Foreign
Exchange
Management Directive No. FXD/45/2016, Amendment
Directive No FXD/46/2017
Banking

Business(Amendment)

Proclamation

No.

1159/2019
Establishment and Operation of Foreign Currency Saving
Account for Residents of Ethiopia, Non-Resident Ethiopianand Non- Resident Ethiopian Origin Directive NO. FXD/68
72020
Directives No. FXD/48/2017 directive for amended of

54
An Investment Guide to Ethiopia

retention and utilization of export earnings and inward
remittance directive No,11/1998.
Directives No. FXD/49/2017 limits on the birr and foreign
currency holding in the territory of Ethiopia.

11.Government’s Institutions
Mandates
1. Ethiopian Investment Board
Chaired by the Prime Minster; members are composedof relevant Minsters.
Makes high-level decision on investment policy issues.
Supervises investment promotion and facilitation
activities.

2. Ethiopian Investment Commission (EIC)The Ethiopian Investment Commission (EIC) is an autonomous
government institution accountable to the country’s Investment
Board, which is chaired by the Prime Minister. A Commissioner,
who is also member of the Board, heads the EIC.
The EIC has restructured itself recently with a view to providing
effective and efficient service to investors and attracting more FDI.
The main services provided by EIC include:
Promoting the country’s investment opportunities andclimate to foreign and domestic investors;
Providing

one-stop

services

includingissuancesof

Investment Permits, Business Licenses and renewals aswell as Construction Permits for Industrial Parks;

55
An Investment Guide to Ethiopia

Notarizing Memorandum of Association and its amendments;
Issuing Commercial Registration Certificates, amendments,
replacements, or cancellations;
Effecting registration of Company name, and amendment,
replacements or cancellations;
Issuing Work Permits, including renewals, replacements,
suspensions, or cancellations:Registering technology transfer agreements and Trade
Mark;
Negotiating and, upon government approval, signingbilateral investment promotion and protection treaties withother countries; andAdvising the government on policy measures needed tocreate an attractive investment climate for investors.
In addition, the EIC offers the following free, confidential andcustomized services to investors:
Provision, through our website, various publications or
through direct response to investor’s inquiries, of
information on sector-specific business opportunities,business incorporation
related regulations.

procedures,

employment

andHandholding support to the investors during the acquisitionof land and utilities (water, electrical power, telecom andother services).

3. Industry Park Development Corporation(IPDC)Develop and administer Industrial Parks, lease developed
land and lease and transfer, through sale, constructions
thereon:56
An Investment Guide to Ethiopia

Prepare detailed national Industrial Parks Master Plan
based on the national special Master plan, and serve as theindustrial park land bank in accordance with the agreements
concluded with regional governments;
In collaboration with the concerned bodies, ensure thatnecessary infrastructure is accessible to Industrial Park
developers;
Outsource, though management contracts, when it isdeemed necessary, the management of Industrial Parks;
Promote extensively the benefits of Industrial Parks andthereby attract investors to the parks;
In line with directives and policy guidelines issued by the
Ministry of Finance sell and pledge bonds and negotiate
and sign loan agreement with local and international
financial sources; andEngage in other related activities necessaries for theattainment of its purposes.

4. Ministry of Trade & Regional Integration
Promote the expansion of domestic trade and takeappropriate measures to maintain lawful trade practices;
Create conducive conditions for the promotion anddevelopment of the country’s export trade and extend

57
An Investment Guide to Ethiopia

support to exporters;
Establish a system that enable to ascertain that export orimport goods are sold or bought at the appropriate pricemake follow ups in collaboration with the concerned
executive bodies and take measures in accordance with thelaw against those who export by under invoicing as wellas
import under or over invoicing;
Establish

foreign

trade

relationscoordinate

trade

negotiations sign trade agreements in accordance with law
and implement same;
Establish and follow
comprehensive system

up the implementation of
for the prevention of anti-

competitive trade practices provide
consumers in accordance with the law;

protection

toProvide commercial registration and business licensing
services in accordance with the relevant laws and control
the use of business licenses for unauthorized purposes;
Provide support for and monitor the establishment andoperation of share companies with a view to protect theinterests of shareholders and the society;
Undertake and submit to the Council of Ministers pricestudies relating to basic commodities and services thathave to be under price control and upon approval follow
up the implementation of same;
Establish the legal metrological system of the country
regulate its enforcement and coordinate the concerned
regulatory bodies;
Control the qualities of export and import goods prohibit the58
An Investment Guide to Ethiopia

importation and exportation of goods that do not conformwith the required standards and work in collaboration withthe concerned organs;Control the compliance of goods and services with therequirements of mandatory Ethiopia standards and takemeasure against those found to be below the standards set
for them;
Cause the coordinated enforcement of standards applied byotherenforcement
bodiesorganizeanddirectimplementation review conferences;
Organize the trade data of the country and disseminate
same to the consumed bodies;
Encourage the establishment of Chambers of Commerceand Sectorial Associations including consumers associations
and strengthen those already established.

5. Ministry of Industry
Create an enabling system for enhanced participation and roleof the private sector in the industry in particular in the
manufacturing industry; create conducive condition for the
implementation of the same;
Cause the building of capacity and enhancement ofcompetitiveness of industries, investment and manufacturingindustries by providing the necessary support for researchers
in the sector;
Create conducive conditions for the participation of domestic
and foreign investors in the investment of manufacturingindustry sector in accordance with the investment laws;
establish a system to enable the institutions accountable to it
to support mainly domestic investors and implement the same.

59
An Investment Guide to Ethiopia

Establish a system of capacity building, research andinculcation

tomaintainqualitystandards

andcompetitiveness of industrial in particular manufacturingindustrial

products

ininternational

markets;

oversee

implementation of the same.
Establish

working mechanism and formulate policy andstrategy that enable to create linkage and effective
transformation between small, medium, and large-scaleindustries.
Encourage the establishment of industrial, sectorial, andprofessional associations, and strengthen those alreadyestablished.

6. Ministry of Revenues
Collect revenue from customs duties and domestic taxes.
In addition to raising revenue, the Ministry contribute to theeconomic development and social welfare by developing amodern tax and customs administration that employs
professional and highly skilled staff who promote voluntarycompliance amongst individuals and businesses and takeswift action against those who do not comply.

7. Ethiopian Customs Commission (ECC)
Provide equitable, expeditious and quality service by
establishing a modern customs administration system.
Moreover, the Commission collects duties and taxes timely
and efficiently on goods imported or exported. It also
implements

relevant

customslaws

andagreements approved and ratified by Ethiopia.

60
An Investment Guide to Ethiopia

international

8. Ministry of Mines
Provides one-stop services for investors in mining
operations: issues investment license, export permit,
customs duty-and tax-free support letter etc.
The Licensing and Administration Directorate in the MoM
issues
i.
ii.
iii.
iv.
v.
vi.
vii.

Reconnaissance Licenses
Exploration Licenses
Retention licenses
Artisanal mineral operations licenses
Special small scale mineral operations licenses
Small scale mineral operations licenses
Large scale mineral operations licenses

9. Ministry of Labor & Social Affairs
Avails information on labor rules and regulations forinvestors
Initiates and leads a tripartite engagement with employer
and employee associations with and outside of industrial
parks.
Assigns labor inspectors to follow up and supervise on
implementation of labor laws by investors.

10. Development Bank of Ethiopia
A specialized financial institution established to promote
the national development agenda through development
finance and technical support to viable investment projects

61
An Investment Guide to Ethiopia

in priority sectors such as agriculture, agro-processing &manufacturing.
Provides medium and long-term loans for various projects
focusing on priority investment areas and plays central rolein promoting the over-all economic development of thecountry.

11. National Bank of Ethiopia
Manages the country’s foreign exchange reserve; ensureseffective use of such reserve through monetary andfinancial regulations.
Issues approval of transactions involving hard currency(investment capital inflow, repatriation of funds, suppliers
credit, export/ import bank p e r m it and so forth. )12. Ethiopian Electric Power
Administrates power plants in the country and purchases
power from independent power producers.

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An Investment Guide to Ethiopia

a.

Client Charter

No. TYPE OF SERVICE

DELIVERY
TIME

FEE
(ETB)

1

Company name registration

1 hour25

2

Alteration/ amendment of a company name1 hour803Issuance of substitute certificate of a company name1 hour50

4Notarization of memorandum and articles ofassociation

3 hours

810

5

Amendment/ change of memorandum andarticles ofassociation

3 hours4006Issuance of commercial registration

3 hours100

3 hours80

1 hour50

7

Amendment/ change of commercial registration

8

Replacement or substitution of commercial
registration

9

Cancellation of commercial registration

5 working days

50

10Issuance of investment permit

3 hours

600

11Investment permit (expansion)

18 working days

300

12

Renewal of investment permit (new/expansion)

2 working days

200/100

13

Change/amendment of investment permit

3 hours100

14Issuance of work permit

2 hours

2,000

15

Renewal of work permit

1 hour

1,500

16

Substitution of work permit

1 hour

1,200

17Cancellation of work permit

3 hours

18

Registration and issuance of certificate fortechnology transfer agreement

3 hours

200

19Registration of a collaboration agreement
concluded by a domestic investor with exportoriented non-equity based foreign enterprise

2 hours100

20Issuance of business license

10 working days

100

Renewal of business license

2 hours100

22 Amendment of business license

1 hour80

23 Cancellation of business license

30 minutes

Free

1 day

Free

21

24 Capital registration

63
An Investment Guide to Ethiopia

International Companies Operating in Ethiopia

Ethiopian Investment Commission (EIC)
P.O. BOX: 2313
Tel: +251 11 551 00 33
Fax: +251 11 551 43 96
Email: info@ethio-invest.com
Website: www.investethiopia.gov.et
Industrial Park Development
Corporation (IPDC) Tel: +251-11-6616986/661-6674
Email: admin.info@ipdc.gov.et
Website: www.ipdc.gov.et

Ministry of Trade
P.O.Box: 6945
Tel: +251-11-5507542
Fax: +251-11-5759871
Email: N/A
Website: www.moin.gov.et

Ministry of Industry
P.O.Box: 2458
Tel: +251-115515411
Fax: +251-115-53 4968
Email: N/A
Website: www.moi.gov.et

Ministry of Labor & Social Affairs
P.O.Box: 2056
Tel: +251-115-517080
Fax: +251-115-518396
Email: molsa.comt@ethionet.etWebsite: www.molsa.gov.et

Ethiopian Energy Authority
Tel: +251-115-507735
Fax: +251-115-507734
Website: www.eea.gov.et

National Bank of Ethiopia
P.O.Box: 5550
Tel: +251-11-551-7430
Fax: +251-11-5514588
Email: nbeinfo@nbe.gov.et
Website: www.nbebank.com

Development Bank of Ethiopia
P.O.Box: 1900
Tel: +251-11-551-1188/89
Fax: +251-11-551-1606
Email: dbe@ethionet.etWebsite: www.dbe.com.et

Ethiopian Customs Commission
Tel: +251-8258748
Fax: +251-115-514396
Email: eccweb@revenue.gov.et
Website: www.ecc.gov.et

Ministry of Revenue
P.O.Box: N/A
Tel: +251-115-528577
Fax: +251-116-629842
Email: N/A
Website: www.mor.gov.et

Ethiopian Civil Aviation Authority
P.O.BOX: 978
Tel: +251- 116-650200
Fax: +251-116-650281
Email: civil,aviation@ethionet.et

Ministry of Mines
P.O.Box.: 486
Tel: +251-116-675495
Fax: +251-116-646336/4
Email: info@mom.gov.et

Website: www.ecaa.gov.et

Website: www.mom.gov.et

An Investment Guide to Ethiopia

65

USEFUL CONTACTS

Ministry of Foreign Affairs
P.O. BOX: 393
Tel: +251 11 551 7345
Fax: +251 11 5514300/551 1244
Email :mfa.addis@telecom.net.etWebsite: www.mfa.gov.et

Africa Avenue, Infront of Dembel City Center
P. O. Box 2313 Addis Ababa Ethiopia
Tel: +251 11 551 0033
Fax: +251 11 551 4396
Email: info@eic.gov.et
Website:www.investethiopia.gov.et
www.theiguides.org/Ethiopia
January 2023