Investments Restricted for foreign Investors in Ethiopia

Investments Restricted for foreign Investors in Ethiopia – Ethiopia is Africa’s oldest independent countries in Africa and also the 2nd most populous with over 105 million people. It was also identified by the World Bank Global Economic Prospects as one of the fastest growing economies in the world with an average of about 11% annual GDP growth for the last 14 years.

Global Stakeholders and Foreign Direct Investors have their eye on Ethiopia for the following reasons:

  • Social and political stability
  • Youth potential and trainable labor force with over 70% of the population under 30
  • Growing economy
  • Excellent climate and fertile soils
  • Strong investment guarantees and protection
  • Regional hub with access to wide market
  • Improved economic infrastructure
  • Competitive incentive packages
  • Government commitment
It is, however, worth noting that there are some Investments Restricted for foreign Investors in Ethiopia. There industries that are reserved for either the government or for locals only. Here are the details below: 
Areas Reserved for Government Investment
1Postal service except courier services.
2Transmission and supply of electrical energy through integrated national grid system.
3Passenger air transport systems and services using aircraft with the capacity of more than 50 people.

 

Areas Reserved for Joint Venture Investment With Government
1Production of weapons and ammunition.
2Telecommunication services.

 

 

Areas Reserved for Domestic Investors
1Export of raw coffee, chat, oil, seeds, pulses, precious minerals, natural forestry products, hides and skins bought from the market, live sheep, goats, camels, equines and cattle not raised by the investor.
2Import trade, excluding, LPG and Bitumen.
3Wholesale trade, excluding supply of petroleum, by products and wholesale trade by foreign investors of their locally produced products.
4Manufacturing of ice-cream and cakes.
5Manufacturing of plastic shopping bags.
6Finishing of fabrics, yarn, warp, weft, apparel and other textile products by bleaching dyeing, shrinking, sanforizing, mercerizing, or dressing.
7Tanning of hides and skins below finished level.
8Manufacture of cement.
9Manufacture of clay and cement products.
10 Tour operation below grade 1.
11Construction, water-well, mining exploration and drilling companies below grade 1.
12Kindergarten, elementary and junior secondary school education by constructing own building.
13Clinical service by constructing own building.
14Capital goods leasing (this does not include leasing of motor vehicles).
15Printing industries.

 

Areas Reserved Exclusively for Ethiopian Nationals
1Banking, micro-credit, insurance and saving services.
2Broadcasting and multi-media services.
3Attorney and legal consultancy services.
4Preparation of Indigenous traditional medicines.
5Advertisement, promotion and translation works.
6Domestic air transport services using aircraft with a seating capacity of up to 50 passengers.
7Packaging, forwarding and shipping agency services.

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