Saturday, May 25, 2024
BusinessEthiopia secures USD 1.1bln in FDI inflows: UNCTAD

Ethiopia secures USD 1.1bln in FDI inflows: UNCTAD

Half year receipts show 12 pc decline

The United Nations Conference on Trade and Development (UNCATD), in its Investment Trends Monitor Report released this week, indicated that Ethiopia remains relatively stable drawing USD 1.1 billion in Foreign Direct Investment inflows during the first half of 2020.

The report highlighted that while Sub-Saharan Africa has experienced a 21 percent decline, estimated at USD 12 billion in value, Ethiopia has seen only a 12 percent decline securing USD 1.1 billion inflow. UNCTAD asserted that China was an instrumental source of foreign investment.

In her recent presser, Commissioner of Ethiopian Investment Commission (EIC), Lelise Neme told reporters that during the first quarter of the current Ethiopian Fiscal year, some 36 FDI projects were registered raising USD 500million in FDI. The commissioner underscored that the stated value represents a 20 percent decline from the targeted USD 700 million for the reported fiscal year.

Furthermore, the foreign projects have added 3,800 new jobs. Some 10,864 jobs as well have been secured from foreign firms operating within industrial parks. However, the targeted number of jobs was set at 20,500 indicating a 72 percent achievement.

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From Sub-Saharan Africa region, Nigeria sustained a 29 percent decline in FDI, valued at USD 1.2 billion, while the whole world has seen a 49 percent decline in FDI inflows. According to UNCTAD, the biggest decline registered is in Europe and the US, where the outlook still remains negative. New projects have declined by 37 percent.

In related news, Prime Minister Abiy Ahmed (PhD) has inaugurated the Dire Dawa Industrial Park. The Park, built at a cost of USD 150million, is expected to create 20,000 jobs in addition to the existing 1,000 jobs.

So far, Semera Industrial Park in the Afar Region is the only project left. The government has invested USD 1.5 billion to create industrial parks solely to enhance and expand the export of manufactured goods. Anticipating it will eventually exit from industrial park developments, the government still considers Public Private Partnership (PPP) as an alternative viable option to participate in industrial park projects. 

It is be recalled that back in 2014, Ethiopia issued an international bond, aka Eurobond in an effort to raise USD one billion and finance electricity, railway, and sugar industry projects. The 10-year bond, with more than six percent interest rates, has partly helped to fund the construction of some of the industrial park projects.

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