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Investment Opportunities in Addis Ababa

            Addis Ababa, new flower, the capital city of Ethiopia, true to the wish of the founders has become the hub of trade activities where entrepreneurs are busy launching new ventures.  This vibrant metropolis with tree-lined boulevard and glorious weather is an ideal place to explore. 

            The capital city has immense potential for various investments, and the different socio- economic ventures thriving to meet the ever growing demand of the public are tangible proofs   the number of investment projects and capital size so far approved by the city account for 49.8 and 56.3 percent of the total number of projects and capital approved between 1992-2003. According to the Ethiopian Investment Commission, 893 investment projects with an aggregate planned capital of 12.1 billion birr were issued with investment licenses in the period. 

            Addis Ababa enjoying proximity to foreign and domestic markets is now in a better position more than ever to attract a relatively better size of investment capital and a larger number of investment projects. The Addis Ababa Investment Authority was established  

few years back to promote investment and service rendering to private entrepreneurs in the city as a one-stop-shop.    The Authority issues investment licenses and business permits, under

takes registration, renewal of documents, land allocation for manufacturing industries, in addition to consultations and information provision.  

            The Authority has approved a total of 829 projects with planned aggregate Capital of 5.49 billion birr as of July 7, 2004 bringing the total investment projects to about 5,914.  

            Some 634 (43%) of the 1, 463 projects approved in 1996 Ethiopian budget year alone were manufacturing industries. Three hundred sixty (25%) others were involved in construction leasing. Construction accounts for 11% while the other sectors including health education, real estate development, hotel and tourism, altogether make up 21% of the total figure approved in the period.

            Depending on the needs of the city and the direction of the government's economic development policy, the Addis Ababa City government has identified construction of residential house, waste disposal, health and education as pioneer investment areas.

            Housing is one good opportunity for investment in the city since there is an acute shortage of houses in the metropolis. Some studies indicate that there will be a demand for over 460,000 residential units in the coming six years. This implies that more than 78 thousand houses must be built on average each year.

 The City Government of Addis Ababa would give incentives and arrange viable conditions for investors to encourage them to engage in real estate development to address housing problem.    Construction of office, residential and multi purpose buildings for rent or sale is lucrative.

            The city Administration also encourages investors to engage in waste disposal management activities. Data obtained from EIC shows that only 65% of the total 2,297 cubic meter solid waste disposed in the city daily is collected. Addis Ababa is also attracting private entrepreneurs in the area of industry.

            With the view to fill the gap in some investment sector, the city has revised investment incentives. Thus, it grants various incentives ranging from importing capital goods duty free, to exemption from income tax and obtaining land with reduced lease tariffs. Currently, the Addis Ababa investment Authority is providing land with the necessary infrastructure and utilities in industrial zones within seven days following application for land.

            The City Government distributed a total of 527,539 hectares of land to 218 investors in the Akaki-Kaliti and Mekanisa -Lebu industrial zones. The developers will invest a total of over 1.18 billion birr and create job opportunities for more than 11,000 people. 

            Addis Ababa has been the capital city of the country for over 118 years. The city is also the seat of the African Union, The United nations Economic Commission for Africa and important regional and international organizations, more than 100 Embassies and Consulates. It is also the cultural, businesses and commercial center of the nation.    It is a business and diplomatic hub where diplomats, tourists, businessmen and other converge from all corners. Parking Development (or recreational, botanical, cultural or historical) or construction of shopping malls, building of concert or conference halls, cultural and modern restaurants, as well as art galleries, could be of interest for entrepreneurs. In addition sectors the like of transport, education and health are great opportunities for investment.

To See Table:- Ethiopian customs authority export trade statistics - period covered 1-31 march, 2005 (Click Hear)