Toward the Competitive Frontier

The perceptions managers have of the investment climate in Ethiopia has improved dramatically since the first investment climate survey in 2001-2002.

Toward the Competitive Frontier: Strategies for Improving Ethiopia’s Investment Climate focuses on productivity because differences in productivity explain differences in income between countries, and attracts new investment. When firms become more productive, they are able to offer a product more likely to meet the quality and cost requirements of foreign markets. They are able to pay higher wages, employ more workers, and the profitability will attract more investment. Developing a private sector that is able to fulfill its development role requires solutions to three challenges: the challenge of productivity and growth, the challenge of inclusion, and the challenge of formalization.

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