Why Ethiopia?

The International Monetary Fund (IMF) has estimated that Ethiopia would be the fifth fastest growing economy among the 189 IMF member countries and regions in 2017. Ethiopia, aiming to achieve middleincome country status over the coming decade, was among the first countries in Africa to show interest in the China-initiated Belt and Road Initiative. The two countries have developed a close relationship over the years and cooperated in politics, trade and economy, culture, education, health and international affairs.

Samuel Halala, Director General of Ethiopia’s Chemical and Construction Inputs Industry Development Institute, said the Belt and Road Initiative has taken the two countries’ relationship to a strategic partnership to develop trade, manufacturing, capacity building, and technology and knowledge transfer.

Ethiopia, he pointed out, has been following Chinese development strategies and policies that have helped its manufacturing industry grow. The trade week is, therefore, not only an issue of trade but also an opportunity for Chinese manufacturers to show their level of quality products to Ethiopia and to Africa as a whole.

Ethiopia is working to enhance the share of the manufacturing sector in the economy and generate a global market. The Ministry of Industry wants the country to be a leader in light manufacturing, which requires packaging materials, chemical inputs and other items and this is where Chinese manufacturers can join in.

Halala said to increase the share of manufacturing in its GDP, Ethiopia is developing industrial parks in different parts of the country. That is a sector where Chinese companies, with their experience of developing industrial parks both at home and abroad, can contribute for mutual benefits.

According to the Ethiopian Investment Commission, the country has attracted investors with projects worth 14.5 billion Ethiopian birr ($623 million) where Chinese companies are leading in terms of capital and in the manufacturing industry, followed by India and Turkey.

Between August 2016 and February 2017, over 120 investment projects became operational, out of which 45 had Chinese investment, which was collectively worth more than 3 billion Ethiopian birr ($128.9 million).

Woldu Gebremariam, an exporter with Tekhaf Trading, an Ethiopian import and export company, said the company has a fruitful trade partnership with China. It exports sesame to China and imports trucks. “Now we are looking to expand our agricultural commodity exports. At the CTW, we found potential partners from China,” he said.

However, doing business with Ethiopia is no bed of roses, despite the potential. According to Frank Wang, Sales Director of Chinese company Hebei Five-star Metal Products, the shortage of dollars is a big challenge to do business with their Ethiopian partners. “We have been exporting our products to Ethiopia for the past 12 years,” he said. “But in recent years, it has been taking months for our Ethiopian partners to get dollars and pay for the imports.”