Investment Policy Review of Ethiopia
An IPR of Ethiopia was published in 2002. The nature of the review, although focused on investment policy and promotion, gave special consideration to technological development and research. This was highlighted in relation to developing the potential of the agriculture sector and improving productivity. The potential of the leather and leather products sector to attract higher FDI inflows was also emphasized. Recommendations for this sector concentrated on technological changes that could improve product quality and production systems, developing the value chain in the production of leather goods and policies to support the sector. The development of SMEs, identified as an engine for private sector development and a priority of the Government, was also addressed in the IPR.
In 2009, the Government of Ethiopia requested UNCTAD to assess progress made in implementing the recommendations set out in the IPR. Overall, the report showed that investors have expressed satisfaction with the measures taken by the Government of Ethiopia to improve the regulatory environment for foreign investment since the publication of the IPR. The report notably noted that an Industrial Strategy was launched in August 2003. The strategy included a number of measures to boost the development of three main sectors where it is believed that Ethiopia has comparative advantages: (a) textile and garments, (b) meat leather and leather products, and (c) agro-industry. In other areas analysed in the IPR, however, implementation progress is mixed, thus suggesting room for further growth in FDI inflows.
Since the IPR was published, UNCTAD has assisted the Government in a number of ways. It:
- prepared a strategy for the promotion of the industrial mining sector
- produced an Investment Guide to Ethiopia
- provided assistance through its Good Governance in Investment Programme, which promotes efficiency and transparency in investment institutions, and which led to the development of a client charter for the Ethiopian Investment Authority and customer service training for its staff
- provided support to set up facilitation and aftercare service to investors at both federal and regional levels
- trained IPA staff to carry out targeted investment promotion.