Ethiopia Opens Up Business Environment to Boost FDI: Gov't Officials

Addis Ababa, May 12, 2025 (ENA) -- The Government of Ethiopia is accelerating efforts to open up its business environment in a bid to attract more foreign direct investment (FDI), senior government officials said.

Speaking at the Invest Ethiopia 2025 high-level business forum, officially opened today in Addis Ababa, Finance Minister Ahmed Shide, emphasized Ethiopia’s favorable investment climate and key advantages including vast arable land, abundant water resources, a young and educated labor force, and emerging infrastructure.

He also noted that Ethiopia remains one of Africa’s top investment destinations, driven by the government’s homegrown economic reform agenda focused on macroeconomic stability and sustainable development.

 

The liberalization of sectors such as telecommunications, logistics, energy, and more recently banking, retail, and wholesale, has deepened investor confidence and reaffirmed commitment to an open and dynamic economy, Ahmed said.

He  pointed  out  the launch of the Ethiopian Capital Market as a milestone that enhances the country’s competitiveness and supports a private-sector-led economy, noting that ongoing legal, policy, and structural reforms are yielding tangible results, including stronger economic growth and an increasingly stable financial system.

He also emphasized that the government’s prioritization of private-sector participation has been a key element of the reform strategy.

"Investment, both foreign and domestic, is increasing across critical sectors. our liberalization of key industries such as telecommunications, logistics, energy and more recently banking, retail and wholesale has deepened investor confidence and reaffirmed our commitment to an open and dynamic economy," he elaborated. 

Foreign Affairs Minister Gedion Timothewos echoed these sentiments, stressing that Ethiopia is now regarded as a major investment destination.

He cited robust infrastructure development, expanding industrial parks, improved logistics, investor-friendly policies, and a highly productive workforce as major draws for foreign investors.

 

The minister also emphasized Ethiopia’s provision of affordable, renewable energy, and acknowledged past shortcomings in supporting private enterprise.

He called on international investors to seize opportunities in agriculture, manufacturing, energy, mining, tourism, and other key sectors.

"Restrictions on Foreign Direct Investment in many sectors, the overall regulatory legislative and policy framework in Ethiopia made FDI a very difficult undertaking. Right now, there is a major paradigm shift that today Ethiopia welcomes and encourages FDI as a critical pillar necessary to realize our aspiration of shared prosperity for all Ethiopians."

Planning and Development Minister Fitsum Assefa presented Ethiopia’s vast investment potential, emphasizing its strategic geographic position, growing domestic market, and access to regional and global markets.

 

“Ethiopia is positioned as a strategic position in the region and access to regional and global market are one of the most important investment attractions to Ethiopia.

Ethiopia has a huge and growing domestic market, huge population, growing income, half of the global population is reachable in under 8 hours flight and our logistics sector is also set to really create an enabling environment for investors," she stated.

Moreover, as a founding member of COMESA, Ethiopia accesses market of around 560 million people as well as through AfCFTA can access of 1.4 billion population, Fitsum noted.  

Ethiopian Investment Commission Commissioner Zeleke Temesgen on his part reinforced the government’s commitment to supporting foreign investors and noted that reforms undertaken during the liberalization period have significantly enhanced Ethiopia’s openness to FDI.

 

He underscored that "the ongoing sectoral liberalization undertaken by the government has enhanced Ethiopia's openness to foreign investment. Notably, the opening up of sectors such as finance, telecom and the trading sectors which were largely reserved for government or domestic investors are now open for foreign direct investment." 

The commissioner concluded by reaffirming the government’s readiness to facilitate further collaboration with global investors and encouraged stakeholders to explore the vast opportunities Ethiopia offers.