Focus – 2021 Investment Climate Statements
Ethiopia’s economy has been challenged by the COVID-19 pandemic, a severe locust infestation, localized unrest in several parts of the country, political tensions, and a devastating conflict in the Tigray region. The IMF forecasts economic growth to slow to two percentage points in Ethiopian fiscal year 2020/21 (starting July 8, 2020). Given the pandemic, potentially destabilizing national elections on June 5, 2021, and the conflict in Tigray, the timeline for a recovery is uncertain. However, the government has made progress on its ambitious economic reform agenda. In the last year alone, the Ethiopian government revised its sixty-year old commercial code, enacted a new investment regulation, began steps to sell two telecom spectrum licenses to foreign operators, and developed a financial sector liberalization roadmap. Still, Ethiopia’s rank in the World Bank’s Ease of Doing Business Index was 159 out of 190 economies in 2020, a metric indicative of the myriad challenges facing any investor in the country. Ethiopia is the second most populous country in Africa after Nigeria, with a population of over 110 million, approximately two-thirds of whom are under age 30. Low-cost labor, a national airline with well over 100 passenger connections, and growing consumer markets are key elements attracting foreign investment…..Continue Reading
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